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Ready to exchange, but seller's lender hasn't released funds
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Emmgrem
Posts: 4 Newbie
Hello,
I’m new to this forum and hoping someone may have some advice, or may there’s someone who’s been in the same position who can tell me their experience..
We are first time buyers and have now been waiting 4 months now since our offer was accepted (after already having lost out on 3 previous houses which went to sealed bids – a stressful experience in itself). We seem to have had set back after set back in our chain (4 couples in the chain) with buyers pulling out of houses and looking for other houses, issues with searches being flagged at the very last minute before exchange, problems getting mortgage offers through, an extra £500 legal fee for a bit of land we hadn’t even been told was community owned etc.…
For the last 4 weeks we keep being told we’ll exchange ‘this week’ and now we’ve finally started discussing dates. All of a sudden it’s now come to light that our seller’s seller haven’t had their funds released by Woolwich, as they have only owned the house for a few months before putting it back on the market again. Woolwich are now looking into this to check there’s nothing fraudulent about this. Is this standard practice and nothing to worry about, or could it mean that the whole thing will fall through? From google searches it does say that some lenders won’t release funds until the house has been owned at least 6 months. But in that case why wasn’t this flagged as an issue earlier and why did Woolwich still offer them a mortgage?
If this doesn’t get cleared up in the next few days and we cant exchange this week it could mean that our mortgage offer will expire. Basically because of this seller’s work commitments he can only complete on Fridays he’s said, and because our seller works away for periods of 5 weeks at a time it would put our completion date back to December, at which point we also go away for 3 weeks over Christmas and our mortgage offer expires on 3rd January!! I cant believe it could come to this…
Firstly does anyone have any light to shed on lenders releasing funds after a quick house sale… Secondly what happens about mortgage offers expiring, can you get extensions? I think the seller’s seller is being very awkward about only being able to complete on Fridays considering it’s his problem with his lender which is holding up the whole chain. One final question... We've already given our deposit to the solicitor.. Surely if this goes on for another few months they owe us interest on the £27,500 of ours which they have sitting in their bank account no? We wouldn't have been so quick to transfer it across were we not being told that everyone was ready to exchange for the last 4 weeks.. we didn't want to be the ones holding it up, since it takes 5 days to transfer the money..
Nightmare!!! The system is so flawed in this country. If this is what it’s like for a first time buyer, I feel truly sorry for people in the middle of a chain!
I’m new to this forum and hoping someone may have some advice, or may there’s someone who’s been in the same position who can tell me their experience..
We are first time buyers and have now been waiting 4 months now since our offer was accepted (after already having lost out on 3 previous houses which went to sealed bids – a stressful experience in itself). We seem to have had set back after set back in our chain (4 couples in the chain) with buyers pulling out of houses and looking for other houses, issues with searches being flagged at the very last minute before exchange, problems getting mortgage offers through, an extra £500 legal fee for a bit of land we hadn’t even been told was community owned etc.…
For the last 4 weeks we keep being told we’ll exchange ‘this week’ and now we’ve finally started discussing dates. All of a sudden it’s now come to light that our seller’s seller haven’t had their funds released by Woolwich, as they have only owned the house for a few months before putting it back on the market again. Woolwich are now looking into this to check there’s nothing fraudulent about this. Is this standard practice and nothing to worry about, or could it mean that the whole thing will fall through? From google searches it does say that some lenders won’t release funds until the house has been owned at least 6 months. But in that case why wasn’t this flagged as an issue earlier and why did Woolwich still offer them a mortgage?
If this doesn’t get cleared up in the next few days and we cant exchange this week it could mean that our mortgage offer will expire. Basically because of this seller’s work commitments he can only complete on Fridays he’s said, and because our seller works away for periods of 5 weeks at a time it would put our completion date back to December, at which point we also go away for 3 weeks over Christmas and our mortgage offer expires on 3rd January!! I cant believe it could come to this…
Firstly does anyone have any light to shed on lenders releasing funds after a quick house sale… Secondly what happens about mortgage offers expiring, can you get extensions? I think the seller’s seller is being very awkward about only being able to complete on Fridays considering it’s his problem with his lender which is holding up the whole chain. One final question... We've already given our deposit to the solicitor.. Surely if this goes on for another few months they owe us interest on the £27,500 of ours which they have sitting in their bank account no? We wouldn't have been so quick to transfer it across were we not being told that everyone was ready to exchange for the last 4 weeks.. we didn't want to be the ones holding it up, since it takes 5 days to transfer the money..
Nightmare!!! The system is so flawed in this country. If this is what it’s like for a first time buyer, I feel truly sorry for people in the middle of a chain!
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Comments
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All of a sudden it’s now come to light that our seller’s seller haven’t had their funds released by Woolwich, as they have only owned the house for a few months before putting it back on the market again.
Are you exchanging and completing on the same day? Funds won't normally be released for exchange, but for completion. It is normal for selling within 6 months of purchase to be an issue.Basically because of this seller’s work commitments he can only complete on Fridays he’s said, and because our seller works away for periods of 5 weeks at a time it would put our completion date back to December, at which point we also go away for 3 weeks over Christmas and our mortgage offer expires on 3rd January!!
All others in the chain could try putting pressure on him to complete on a different day.Secondly what happens about mortgage offers expiring, can you get extensions?
Depends on the lender. Generally you would need to re-apply, in some cases it can be extended if completion is imminent and the solicitor requests it.Surely if this goes on for another few months they owe us interest on the £27,500 of ours which they have sitting in their bank account no?
This should be detailed in the information you were given when you instructed the solicitor; interest from when and at what rate. It may be that they will send the money back.we didn't want to be the ones holding it up, since it takes 5 days to transfer the money..
Not if you send the money via faster payments or CHAPS.0 -
Thanks for your reply.
No we are not completing and exchanging on the same day, as solicitors have said Nationwide need 5 working days notice before request of funds.
If selling within 6 months is a normal issue why wasn't it flagged at the start of the process rather than just before exchange?
We knew no one else in the chain was using CHAPS and so therefore didn't want to incur the telegraphic transfer fee for no reason.
We've got our solicitor on a no-purchase-no-fee basis so we shouldn't lose the money, but thanks for the advice - I will check the paperwork first.
It's more just the issue of Woolwich not releasing funds which is bothering me now incase this is likely to cause the whole thing to fall through.0 -
This is where the Estate Agent should be earning their corn.
Not quite sure I understood your message and who is being prevented from doing what but the short answer is that Lenders can have a problem with short term re-mortgages and re-sales.
This is a situation to put firmly on the toe of your Estate Agent - give them a window to sort it or you will pull out.I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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