Change of purchase price after mortgage offer

bbuckle

Hi,

My partner and I received a formal mortgage offer (from Nationwide) for around 25% LTV on a property that we are proposing to buy. Recently, we discovered an issue and asked the seller to rectify it before we would agree to exchange (we had not exchanged but were about to). The seller has offered to reduce the asking price by the amount required to rectify the issue and we have agreed to this.

What is the procedure now for us? We would still require the same amount offered by Nationwide, but the overall purchase price is now lower (by around £6.5K). Will our conveyancer handle this, or do we need to go back to Nationwide and advise of a change of circumstances surrounding the purchase?

We're happy to do whatever is required, but would appreciate any advice on handling situations like this.

Many thanks

Carrot007

If nationwide valued it at enough for the mortgage then you have nothing to do (you also had no good reason to ask the seller to recify either, but hey, asking costs nothing!).

bbuckle

Thanks, that sounds reasonable.

We discovered that the sewage system had to be replaced, under new legislation, by January 1st 2020 or upon the sale of the property. After studying the new regulations, we believed that this was for the seller to address, not us. They agreed.

amnblog

Nationwide need to adjust the offer as your Solicitors will tell you once they are aware.

bbuckle

Thank you both for your replies, I really appreciate it. Given that I have received two completely different answers, I think I will do as amnblog suggests and just leave it to our (up til now excellent) solicitor to sort out.

butterflybook

Nationwide will need to amend the mortgage offer with the reduced purchase price If you are borrowing the same amount this will increase the loan to value and so will need to be amended

If you have used a broker they will handle this for you - Your solicitor can also inform Nationwide however if i were you i would give the lender a call to let them know

bbuckle

Once we get formal acceptance of the new price from the seller's solicitor I will do exactly that. Thank you.

bbuckle

An update on this, for anyone interested. Our solicitor informed the building society and a new offer was issued within 4 days (we actually exchanged today). I didn't do any chasing myself as I didn't want to muddy the waters in any way. Solicitor handled it all just fine.

EDIT: On the solicitor's Statement of Account, the discounted amount is shown as an 'Allowance'. I'm not exactly sure what tat means, but it is obviously one way of handling this particular situation. Hopefully that info is useful for others.