I've been conned - need advice

Scorpzor

A couple of months ago I put down a deposit for a new house. I got my mortgage offer and the solicitor sent me the contracts but I didn't immediately sign them as I wanted to have a good think about whether I was making the right decision.

2 days ago I received a phone call from my solicitor saying that he had received word from the builder that I need to exchange contracts by Friday (today) otherwise they would be 'reviewing the reservation on my plot'.

This worried me, and that night I signed the contracts and mailed them as soon as I could the next day so that they would be there by today. I then transferred the deposit.

I just got home from work a couple of hours ago and I have discovered that they have reduced the price of identical houses on the estate including the one that is attached to my house (its a semi) by £10000. I feel absolutely sick. What can I do?! I signed the contracts and paid the deposit just hours ago and now I discover this. I feel like I have been completely conned.

silvercar

Has your solicitor actually exchanged contracts on your behalf? Often exchange doesn't take place as soon as the solicitor has the paperwork but when everything is agreed after that. My solicitor had my signed contract and deposit for 3 weeks and phoned up on the morning of exchange to confirm I wanted to go ahead. Unless your solicitor has confirmed today that exchange has happened you should be able to put a stop on it.

If exchange has occurred the best you can do is plead with the developer to act reasonable, chances are they may throw some sweeteners in your direction like carpets or lawn.

Scorpzor

Yes he literally opened the post in the morning and exchanged immediately and I got an email from the developer confirming that contracts have been exchanged this afternoon.

I have already agreed on extras for the house. Much of the things I wanted came with the house as standard as it turned out, and there was very little else to choose from.

I am going to go in tomorrow and have words, then on Monday I'm going to phone my mortgage provider and challenge their valuation, since it was obviously wrong.

ACG

Why have you been conned?
If you have exchanged contracts there is nothing you can do.

You have bought a house at a price you were happy with.

Landofwood

Scorpzor wrote: »

then on Monday I'm going to phone my mortgage provider and challenge their valuation, since it was obviously wrong.

So then your mortgage lender drops the amount they're willing to lend you by 10k, and then you have to find an extra 10k or be in breach of contract.

Great idea.

Voyager2002

Scorpzor wrote: »

Yes he literally opened the post in the morning and exchanged immediately and I got an email from the developer confirming that contracts have been exchanged this afternoon.

I have already agreed on extras for the house. Much of the things I wanted came with the house as standard as it turned out, and there was very little else to choose from.

I am going to go in tomorrow and have words, then on Monday I'm going to phone my mortgage provider and challenge their valuation, since it was obviously wrong.

None of this will help...

You don't know why the developer reduced the prices: perhaps they needed to sell the remaining houses for less than their value because of cash-flow problems; because someone was retiring... You have no rights once you have exchanged so all that you could achieve is damage relationships in a way that could come back to bite you. Much better to begin to enjoy your new home.

Scorpzor

But they are going to be going to value it again before completion anyway, so they are going to find out one way or another.

Landofwood

Scorpzor wrote: »

But they are going to be going to value it again before completion anyway, so they are going to find out one way or another.

If their valuation drops, you have to pay the difference. So don't rock the boat.

Scorpzor

Well I guess the next question then is going to be if (when they go to do the final valuation) they value at at less than it was originally and then decide they aren't going to give me a mortgage for that much, then what do I do then? I will be in breach of contract as you say and it will have been beyond my control.

Landofwood

Scorpzor wrote: »

Well I guess the next question then is going to be if (when they go to do the final valuation) they value at at less than it was originally and then decide they aren't going to give me a mortgage for that much, then what do I do then? I will be in breach of contract as you say and it will have been beyond my control.

It is highly likely they will value the property at the agreed price.

silvercar

Scorpzor wrote: »

Well I guess the next question then is going to be if (when they go to do the final valuation) they value at at less than it was originally and then decide they aren't going to give me a mortgage for that much, then what do I do then? I will be in breach of contract as you say and it will have been beyond my control.

Yes and yes. Why are they valuing again? Is the property still not finished? Exchanging on a property with a mortgage subject to further valuation is a risk.