being made redundant and ready to complete on buying a new house

lee111s

Sam! wrote: »

Thank you for taking the time to post.
It is a really tough decision for them!
They are not worried about him losing the job as he already knows he will be in employment within the next month (only it will be contracting not staff)

They don't want to say anything yet as he doesn't officially get made redundant until the end of January (consultation starts beginning of January) and in that time things may change as they could get him a job elsewhere staying under their employement or the company may still get sold to another buyer!

Does anyone known at which point the mortgage people put the funds in the solicitors bank?

A few days before completion.

fewcloudy

Sam! wrote: »

Thank you for taking the time to post.
It is a really tough decision for them!
They are not worried about him losing the job as he already knows he will be in employment within the next month (only it will be contracting not staff)

They don't want to say anything yet as he doesn't officially get made redundant until the end of January (consultation starts beginning of January) and in that time things may change as they could get him a job elsewhere staying under their employement or the company may still get sold to another buyer!

Does anyone known at which point the mortgage people put the funds in the solicitors bank?

I'm not sure why it is a "really tough decision for them"? In this instance, it actually seems a really easy decision for them...

I think we all agree that if they inform lender than then they won't get the money. And if they keep quiet they do get the money. You've explained the loss of his the job isn't really a job loss per se, at least not the usual financial nightmare that we think of, due to redundancy package and ease of obtaining next job. In fact you actually said "They are not worried about him losing the job".

So I assume that when you say this is "a really tough decision for them" you mean just from a moral/honesty point of view? To commit mortgage fraud or not to commit mortgage fraud, that is the question... that type of thing?

fc

Thrugelmir

Sam! wrote: »

They are not worried about him losing the job as he already knows he will be in employment within the next month (only it will be contracting not staff)

A lot could happen between now and May.

Sam!

Yes, been speaking to them today and they are not sure if they will be in the wrong by not telling the mortgage company as he has not been informed anything officially so at the minute he's still fully employed by them and will be when he signs for the house next week.

chopper78

Devil's advocate time...

The condition of the mortgage offer will be that your friend must inform them of any material change in circumstances (e.g. redundancy). If the redundancy became official before completion of the property, then your friend would be bound by the terms to tell them (otherwise this is fraud).

If the mortgage company somehow found out between exchange and completion, then your friend would be in a real mess if they pulled the mortgage at this point.

If your friend got into difficulties paying the mortgage because they didn't find another job, and the mortgage company discovered the redundancy was known about before completion, then this becomes more problematic.

But... chances are... they will never find out. It depends on your friend's attitude to risk.

Thrugelmir

chopper78 wrote: »

But... chances are... they will never find out.

Though when it does hit someone directly the consequences are severe.

movilogo

If the mortgage company somehow found out between exchange and completion, then your friend would be in a real mess if they pulled the mortgage at this point.

This ^^^

If not informing lender, then make sure the gap between contract exchange and completion is as little as possible. Just before fund release, lenders usually do a last minute credit search to validate borrower has not defaulted/bankrupted/CCJed etc.

Sam!

Thank you,

Does anyone know if 'being in a consultation situation' between exchange of contracts and completion is the same as 'being made redundant'?

Sam!

Also has anyone heard/ever asked for a clause to be put into the legal contract to say if a mortgage company pull out for any reason the person will not be liable to pay the 10% deposit of the value of the house?

They have told me of horror stories where banks/mortgage companies have pulled!!
I can understand people having to pay the amount if they pull out but if the mortgage company decide to pull out then surely they can't be held responsible for something that isn't in their control!

AnotherJoe

Sam! wrote: »

Thank you,

Does anyone know if 'being in a consultation situation' between exchange of contracts and completion is the same as 'being made redundant'?

They are only the same in that both would be events that you "ought" to inform the lender about. Otherwise, they are obviously different. You are employed in the former and not in the latter

Sam! wrote: »

Also has anyone heard/ever asked for a clause to be put into the legal contract to say if a mortgage company pull out for any reason the person will not be liable to pay the 10% deposit of the value of the house?
!

No. such a clause would have to ripple the whole way up the chain. Seems unlikely you'd get anyone to agree anyway as they would suspect something was up.

Sam! wrote: »

I can understand people having to pay the amount if they pull out but if the mortgage company decide to pull out then surely they can't be held responsible for something that isn't in their control!

This is why you want a relatively short time between the two. OTOH same day is nearly as bad. I think if it does happen what generally seems to occur is that the person gets another lender and only a few weeks have passed so damages are limited.