Negative equity

Tongobriga

Hello Im just looking for some information.
Im buying a House. I did a verbal offer was accepted,
And i told My Solicitor to do it formal.
After 2 weeks without answer I phone to my solicitor and she phone to the sellers and they said they are in equity negative.
They are waiting for the lender permission to sell the house.
2 weeks ago the lenders ask for information about us, buyers.
But until now I have no heard from them.
My solicitor don't know how much time can take.
and I think she is not bother with it.
I've been around 6 weeks from the day I did the offer.
I wonder if is normal take so long. How much time can take. If is any thing we can do to accelerate the process.
Thank you

princeofpounds

It depends a lot on how well-staffed the mortgage lender is. It should take no more than 2 weeks really from the date the lender is actually notified (don't assume that is the same day you submitted your offer), but I can easily imagine it taking 4. The lender might be assessing whether to allow any small remaining debt to become an unsecured loan.


If it takes much longer, quite possibly your vendors still wouldn't quite clear the negative equity and are running around trying to raise money to bridge the gap.

silvercar

Your vendors should have investigated their mortgage options before putting the property on the market. If an asking price offer won't clear the mortgage, they should have already looked at their options, otherwise what was the point of putting their house on the market.

Tongobriga

I heard they got to do a shortfall, or declare bankruptcy. What bothers me is anyone have a glue how much time can take.
I feel a bit desapointed because my solicitor is young, I think is her first year working, I feel she could chase more. But I understand is on the lenders the answer ... Well don't know what is the point to out the house for sale without make sure they can sell it.

Thrugelmir

Tongobriga wrote: »

After 2 weeks without answer I phone to my solicitor and she phone to the sellers and they said they are in equity negative.

Problem is entirely the vendors to resolve.

Continue to look for an alternative property to purchase.

Annisele

It's not your solicitor's fault.

It doesn't matter how old she is, or how experienced she is - she can't advise the sellers on how to sort our their shortfall. That's a job for the sellers / their solicitor/ their bank/ whoever else is advising the sellers.

ellie27

I would be walking away from this. A house that is on the market should be ready to go and things like this should be sorted out in advance before the house went on the market. The fact the house/sellers is in negative equity is irrelevant if the sellers are simply making up the shortfall, but it doesnt sound like thats the plan.

pleasedelete

ellie27 wrote: »

I would be walking away from this. A house that is on the market should be ready to go and things like this should be sorted out in advance before the house went on the market. The fact the house/sellers is in negative equity is irrelevant if the sellers are simply making up the shortfall, but it doesnt sound like thats the plan.

Until they know what price they have sold for they don't know how much the negative equity is. They can only finalise negotiations with the lender when they know this.

The OP doesnt say that they are making up the shortfall. They say they have to make up the shortfall or declare bankruptcy.

Tongobriga

Thank you to everyone.
Well I will wait until Friday but I'm already starting to look for another house. The problem is I like this one. But i cannot wait forever

audigex

You can't, and there's also no guarantee the sale will even go ahead - the vendor may decide it makes more sense to stay in their house, continue to pay the mortgage and wait until they're at least back to breaking even, before they move.

I wouldn't necessarily withdraw the offer, but I would go looking for something else: you were ready to go, this isn't your problem and you should have no guilt about exploring alternate options. Particularly if prices are rising in your area, a couple of months delay before the vendor withdraws could be expensive!