Our buyer likely now pulling out ! :(

Tony_MechEng

All was going smoothly sold our shared ownership flat in January, buyer purchasing outright from the housing association,we found a house and had offer accepted, surveys and valuations all done along with mortgage offer (which thought would be the stumbling block but that's another story) phoned up the estate agent for update only to be told that the buyers solicitor has recommended the buyer does not proceed with the sale!!

It appears that the housing association have a clause which says that the H/A reserve the right to revalue the flat 3 months AFTER completion and if the valuation has increased they are entitled to their ownership percentage share.?? I have been told its a common clause and that the likely hood of them doing it is minimal. They said its a fraud/money laundering thing. Does anyone have any experience of this and any options?

The EA suggested trying to get indemnity insurance but my solicitor (who I have lost confidence in because he seems so disinterested) has advised that the one he went to will not provide the guarantee/insurance premium against it.

At bit of a loss now and stand to lose around £1600 in solicitor fees and mortgage app fees..

Any help appreciated. Tony

hazyjo

Any way you can legally offer to pay it?!

Not much consolation, but without that guarantee, I'd pull out too Wasn't it explained to you when you bought?

Jx

Tony_MechEng

No we were never made aware of it but all i get told by my solicitor is its not uncommon...

I would happily accept the risk and pay should it arise but solicitor saying that its not an option.

thanks though.

hazyjo

Before completion with the risk on the seller... but after?! That could result in thousands! I wouldn't have expected who/whatever you bought it from to spell out that risk, but I would definitely have expected my solicitor to spot it!

No buyer is going to accept 'the likelihood is minimal'. Most people took out chancel repair insurance cos of a tiny risk that was probably even more minimal of it happening!

Have a good google for similar issues - see if you can find a solution.

Jx

KateBob

Are you sure their solictor has understood the clause properly.

We purchased the other half of our shared ownership house with a similar clause but only if we sold the house within the 3 month period.

So we waited before putting it the market, this was 13 years ago however.

Mandog

I first heard of the clause today because I'm staircasing to 100% and transferring half the equity to my partner. I don't really understand it but I also thought it referred to profit made within three months. The solicitor said it would have no effect on us because there wasn't any profit, just transfer of equity, but that the HA had a legal interest in any transaction on the property for three months.

What a horrible situation, really hope it gets sorted out.

Tony_MechEng

Thanks for the replies :-)

I have asked for the solicitor to send me the clause so my other halfs boss of a property company can review. I just don't understand how they would have any control over a property the no longer own.

Tony_MechEng

Bump as a last ditch attempt for anymore advice.

Mandog

Please do post back with what you find out. Slightly surprised no solicitor or conveyancer has been on with definite knowledge and advice.

Good luck