Offer made, survey and all searches all done, but vendor has put the house back on the market

Waterpark45

Hi all,
Looking for some advice here. I put an offer in on a flat which has been on the market 8 months. My offer was accepted and I immediately appointed a solicitor who has undertaken the searches. There are 5 flats in the block and it transpires that 2 of the flats are freehold and 3 are leasehold with share off freehold (the one I'm buying is in this category). My solicitor advised me that this represents a title defect and advised me not to proceed unless the vendor can get everyone to go on a lease and transfer the freehold to a management company. On discovering this, Santander withdrew the mortgage offer as it's too risky. 

I explained this to the estate agent (who knew this all along but hoodwinked me by saying the property was mortgage-able) who fed all this back to the vendor who promised to get all of this sorted as 4 of the flats are on the market but are not shifting for this reason. I said OK, I will wait which I think is pretty reasonable of me. This was some time ago and I keep being told it will be sorted. Meanwhile I'm racking up a nice fat legal bill. Finally, thanks to me and my solicitor, the flat owners are going to have a meeting and resolve the issue. 

Last night while browsing Right Move I was horrified to see "my" flat back on the market. Presumably the estate agent has said once the lease is sorted she'll get much more money for it. I feel like I have just been stabbed in the back. I have committed time and money - and shared legal advice, free of charge to them, hundreds of pounds to me. I am absolutely furious. 

Any advice on where I stand here? I honestly feel like telling them to stick it where the sun don't shine especially as I am in a strong position (I'm renting).

AdrianC

Simples. Until you exchange contracts, there is no tie to the deal on either side. They are just as free to walk away as you are. And, considering you don't currently have a mortgage offer in place, you aren't actually a proceedable buyer right now.

Quite how two flats in a building "are freehold" is another question entirely.

greatcrested

Unfortunately there's litle you can do. The seller can withdraw at any time up to Exchange and any costs you've incurred are yours.

The 2 freehold flats does seem strange, but seemingly the seller and others in the building appear to recognise that. Your options are

* withdraw and start looking again

* raise the issue with the EA and see if the vendor is in fact now renaguing on your agreement (it may be a misunderstandig....)

* do noting.Put the purchase on hold to prevent further legal costs, start searching again, but if/when the owners deal with the Title, if you've no found anywhere else be ready to resume the purchase (hopefully at the original price!)

Marvel1

It is back at a higher price?

Until you exchange contracts, anyone can drop out.

Falafels

Yep - they're as entitled to put the house on Rightmove as you are to view it. Your mortgage offer has been withdrawn, and from the vendor's point of view you've withdrawn from the sale. Even though you want to, you're not in a position to proceed with the purchase and, from that point of view, you aren't in a strong position as regards this property.

Unless there's something about this flat which is totally irresistible, I'd cut my losses and look elsewhere. Even if they do resolve the freehold/leasehold issue in principle, it's likely to take quite a while for all the legal necessaries to be carried out. Until they are, anyone trying to buy these flats is going to come up against the same issue if they need a mortgage.

It's enormously frustrating to put a whole load of money and effort into buying a place, only for it to fall through, but all the searches etc are there to ensure you aren't left with a monumental pile of hassle in the future.

gab3x

you don't want to deal with these people... god knows what else they are hiding from you

Waterpark45

Thanks for your comments, all.  My mortgage adviser spoke to Santander and they said if the lease is sorted, then that's another matter. As is stands, anyone who needs a mortgage can't buy it because of the bizarre set up (down to a solicitor in the 70s who bodged up loads of titles of period properties that were split into flats). No lenders will touch it. My solicitor has never seen one like it! All she can hope for is a cash buyer and even then my solicitor said it would be a very bad idea. In fact the seller has had two buyers pull out so far, and one of them was a cash buyer. It's also come to light that the lady who is trying to sell the flat below the one I like has been trying to do so for four years! 

I think I'm answering my own question here aren't I?! Run like the wind!!

Ah well, I'm renting and in a strong position to proceed with another sale immediately if I see something I like. All fun and games. It's just the lack of transparency I dislike. They have a buyer that is serious enough to to wait and who can get a mortgage as long as the lease is sorted, why wind them up and effectively drive them to look elsewhere? Bonkers.