Completing on a new property

jakub85

Hi,

I am in a bit of an unusual situation (or so I may think) with regards to the completion of my property. Generally speaking I was wondering whether developers have any flexibility around the 10 day completion period?

Here is the situation... I purchased the plot in June 2015 of off a person who originally bought it from Berkeley Homes back in 2013. At that time I secured a 3 month mortgage offer from Lloyds, which was due to expire on the 8th of September. As the property completion was due "sometime in September" I preemptively extended the offer by 1 month (8th of October) in August.

The developer sent a letter to the original owner on the 1st of September, letting them know that the Notice will be served on the 12th of October. I found about it only yesterday as my solicitor failed to provide the developer the Deed of Assignment and so they did not know the ownership changed hands.

Anyway, I managed to speak with the developer (Head of Client Relations) and she was very helpful, offering to move my notice date to the 28th of September (the flat has been already approved by Berkeley and is only pending the final assessment by the building controller next week - what are the chances Berkeley would let them in if they did not think it will pass?). She also agreed to shorten the completion period from the standard 10 days to asap (all communication is in the email).

I have also told her that I am considering making another mortgage application with a different bank just to have a back up option available. She said that if she was me, she would not be applying for one as it is almost certain they will serve notice on the 28th given how far they are in the process.

So, given the above situation, (i) would you think that if worst come to worst and the notice date is moved I will be given any leeway in completing a bit later, or (ii) should I rush to the second bank (HSBC) asap and secure the mortgage offer and pay £500 booking fee for it, just to sleep better? If Berkeley Homes or other developers normally, are flexible in those instances, I am happy to wait, but if I have to forgo about £120k then I am not so calm any more...

Apologies about the long message and thanks in advance for any help!

libf

Check with Lloyds what their policy is on further extensions before you do anything else.

jakub85

Thanks for the suggestion. I already checked with my mortgage adviser and I was told a bit crudely that the completion (transfer of funds, and not the notification that funds need to be transferred) must take place before the 8th of October. I already used the 1 month contractual extension.

If I apply for an additional extension then this may take about 2 weeks to credit score me again, etc. The rate will mean £900 more in interest per year as the one secured in June was rather competitive (1.79% fixed 3 year).

To be fair, everyone (solicitor, mortgage adviser, the developer) seem quite relaxed about the process. Although one reason may be that they are not on the hook for £120k losses.

3 reasons I am reluctant to reapply for a new mortgage with Lloyds are (i) the moment I apply my current offer is rescinded so I effectively sit there with no offer at all in case the flat does get completed on the 28th, (ii) risk around being rejected for whatever reason on the credit check, and (iii) lower rate secured versus the current ones available.

TBeckett100

I wouldn't bank on HSBC turning your application around quickly. Plenty of stories on this forum

jakub85

To be fair I am not hoping for a very quick turnaround. If there is a delay to the original date, then I will ask the developer to have the notice served as late as possible (which would mean a delay versus the 12th of October, until say the 19th). Even if I started the process with HSBC a month earlier then I think they will manage to get an offer out to me in a month.

I am thinking of HSBC because I just secured a BTL on the flat I am currently living in, so I am pretty sure any credit checks should go just fine (the BTL process was not too bad to be honest in terms of delays).

penguingirl

I'd wait til 28th September. If you don't have notice, look for a new mortgage, but it's looking like you should be ok

jakub85

By way of an update - Berkeley was excellent and I have managed to receive the notice on the 28th of September, completing on the 7th (one day before the mortgage offer expired). Thanks for the help whoever responded!