Asked to exchange 95 days before completion

GDB2222

SouthLondonUser wrote: »

Lots of people do stupid things without realising - this doesn't mean we should, too.

...

I would basically tell the seller: I am willing to wait up to 2 weeks and to bear the risk that the lender changes its mind over those 2 weeks (it is such a short time period I find the risk negligible). If YOU want me to wait longer, I cannot bear that risk.

You are of course welcome to tell me I am pedantic and paranoid and you would never sell a property to me because most buyers don't think of these things.

You may well be right that this is not a reasonable risk to take. The trouble is as stated in your first sentence. There are lots of other buyers out there, who won't hesitate to take the risk.

In practice, the usual period between exchange and completion is a month, not 2 weeks. So, you are probably in a bit of a minority on this one.

SouthLondonUser

GDB2222 wrote: »

There are lots of other buyers out there, who won't hesitate to take the risk.

Well, this is not 2012 any more; houses aren't exactly selling in days, nor are they still going up 10% in value every year - quite the opposite. This does give buyers more bargaining power; especially since this negotiation wouldn't be about price, a sensible seller shouldn't have many objections and would be better off accepting a 2-week delay between exchange and completion, rather than risk waiting more months to find another buyer, maybe at a lower price. But of course the world is full of unreasonable people...

GDB2222

SouthLondonUser wrote: »

Well, this is not 2012 any more; houses aren't exactly selling in days, nor are they still going up 10% in value every year - quite the opposite. This does give buyers more bargaining power; especially since this negotiation wouldn't be about price, a sensible seller shouldn't have many objections and would be better off accepting a 2-week delay between exchange and completion, rather than risk waiting more months to find another buyer, maybe at a lower price. But of course the world is full of unreasonable people...

In a normal sale, it would just be a matter of imposing the two weeks on the rest of the chain. It might be doable.

The delay between exchange and completion is for convenience. It allows for removals to be booked, for example.

The solicitors don't start preparing the TR1 until contracts are exchanged, for example. So, they may not be used to compressing their post-contract work into two weeks, although I am sure that can be done, too.

Altogether, insisting on 2 weeks, when 4 is the norm is, is normally just a nuisance to all the others affected. They might well grin and put up with it. In this case, however, it's not going to fit in with the seller's need to complete on his purchase in April.

You'd have to pass your proposed change to the contract past a solicitor. It may well be okay legally, just very unusual.

Really, the possibility of mortgage withdrawal is the sort of risk that ought to be insurable, with premiums depending on the length of the period between exchange and completion. The fact it isn't available reflects how little the problem is understood.

Richard_Webster

As I understand a backstop date this means that the buyer of a newbuild can pull out and get his deposit back if completion doesn't happen by that date. Your seller may want to impose a similar term on you. That should mean you get your deposit back but you've wasted a lot of money on legal fees, mortgage application fees, etc. and you have to start the buying porcess all over again. Perhaps a backstop is reasonable for a new house buyer but not for his buyer.

So, make sure you get a fixed completion date. That means if the new house is not ready by that fixed date the seller still has to move out and give you vacant possession. Not fair to seller - maybe - but he chose to buy a new build and that's one of the risks. You are not buying a newbuild so why should you take the risk? Why should you be stuck with this uncertainty?

Were you told about the potential problems of buying from someone buying a newbuild when you made your offer for the place? Don't asupppose so - so quite reasonable for you to insist you get a fixed completion date. That means if the new house is not ready by that date the seller still has to move out and give you vacant possession.

Not fair to seller - maybe - but he chose to buy a new build and that's one of the risks. You are not buying a newbuild so why should you take the risk? (Of course it is likely that nobody told the seller either that there would be this issue when he offered on the newbuild!)

Moral, only buy a newbuild if it is virtually finished and ready for a legal completion within normal buying/selling timescales.

Insure on exchange - too risky not to do so.

diggingdude

isplumm wrote: »

Hi

What risks are we talking about? I assume the OP is renting at the moment, so exchanging now would give the OP a clear date as to when completion is going to happen - also if it falls through, they should be able to sue for their losses.

Mark

My worry would be something like the roof starting to leak, seller leaving it as they are moving, you complete on a house (may not know what to look for) not to the standard it was at survey stage.This is also a risk for normal non new build purchases but the added time increases risk.

DigForVictory

This week, I'd be wanting a clause that says if anyone dies, the sale goes ahead on the the terms agreed & the seller is to modify their Will to assure that.
It's unlikely to happen & also unlike to make the blindest bit of difference but it would reassure me a little.

davidmcn

DigForVictory wrote: »

This week, I'd be wanting a clause that says if anyone dies, the sale goes ahead on the the terms agreed & the seller is to modify their Will to assure that.
It's unlikely to happen & also unlike to make the blindest bit of difference but it would reassure me a little.

If contracts are exchanged then the contract is still enforceable against the estate, so the contents of the Will are irrelevant (and anyway you'd have no contractual way of obliging someone to put something in their Will, or of checking what it says until it's too late). The executors would still need to get probate to complete the sale - that's the main problem (from your point of view!) if the vendor drops dead, as it can often take months.

If you are genuinely concerned about the vendor's life expectancy, then the solution is to complete the purchase sooner rather than later.

GDB2222

DigForVictory wrote: »

This week, I'd be wanting a clause that says if anyone dies, the sale goes ahead on the the terms agreed & the seller is to modify their Will to assure that.
It's unlikely to happen & also unlike to make the blindest bit of difference but it would reassure me a little.

I would not enter into a contract with someone on their deathbed. As David says, dealing with executors will take months. Anyone in normal health, you are looking at a risk comparable to winning the lottery.