Solicitor exchanged contracts before we have a mortgage offer

Thrugelmir

ekeenan said:

2. We applied for a mortgage back in November, we were granted one in principle but changed lender as we had a better rate. It's waiting on a valuation which I've just managed to book in for tomorrow. 

Did you receive a formal mortgage offer from the lender you originally approached. In that you made a full application. Not just received a DIP. 

Seems a very long gap to you approaching another lender. Given the valuation hasn't even been performed yet. 

ekeenan

Thrugelmir said:

ekeenan said:

2. We applied for a mortgage back in November, we were granted one in principle but changed lender as we had a better rate. It's waiting on a valuation which I've just managed to book in for tomorrow. 

Did you receive a formal mortgage offer from the lender you originally approached. In that you made a full application. Not just received a DIP. 

Seems a very long gap to you approaching another lender. Given the valuation hasn't even been performed yet. 

No we never had a formal offer.

HampshireH

This sounds very very messy. Your girlfriend shouldn't even have been a point of contact if she doesnt have the understanding to make the decisions.

Ultimately her yes has resulted in this

Normally takes a day or so for valuation to be provided and then even longer for funds to be requested and drawn down from lender.

Assume your deposit has already been paid on exchange. That's a lot of money to lose especially as at no time have you ever had a formal mortgage offer.

I really cannot see how you can get all this done by Friday.

Assume your searches are all back
Anti money laundering checks passed satisfactorily etc?

hazyjo

Did you reply to the survey question? May have missed it. Did you have one?

Tbh it's not often I'm lost for words on here, but I just cannot understand how this has happened. It just makes no sense.

MovingForwards

hazyjo said:

Did you reply to the survey question? May have missed it. Did you have one?

Tbh it's not often I'm lost for words on here, but I just cannot understand how this has happened. It just makes no sense.

OPs survey is tomorrow.

steampowered

The most important thing is to do everything you can to get your mortgage in place as quickly as is humanly possible. Whether that be with your current lender or the lender you used previously. Perhaps try hassling your bank/broker.

It sounds like your partner gave authority to exchange. The T&Cs  you have with the conyeancer may state that a single co-owner can give instructions to the solicitor. It isn't necessarily the case that the solicitor would have to get approval from both you and your girlfriend. The conveyancer might have been negligent here but it isn't clear-cut. 

You also need to check with your conveyancer whether the completion date of 13th March has been formally agreed. If you can't get a clear answer on that I think you need to be sitting next to the phone and calling every 10 minutes until you get through to your conveyancer or a senior member of staff.

If the date of 13 March has been formally agreed, but you aren't able to complete, the consequences are as follows:
- You are potentially liable to reimburse the seller for losses they have suffered (e.g. arranging movers, hotel costs etc.)
- The seller may be able to serve a notice to complete. When that notice is served you will have 10 working days to complete, failing which you'd forfeit the deposit (note that this is the contract deposit - not the deposit for mortgage purposes - the contract deposit is likely to be 10% of the purchase price).

ekeenan

Thanks all,

We're aware of the consequences - hence I'm looking at all angles.

Yes we have completed searches and anti-money laundering checks and you're correct in that there was a document in place so that my girlfriend can speak for both of us. 

Just looking through the summary of work there are clauses in there that should cover the solicitor reviewing the mortgage offers. There's also the brochure on the website that covers that they check the mortgage offers - this wasn't done for us. I've attached some screenshots.

Looking through emails we weren't really walked through the process. We had a call that discussed the contracts themselves but never about the actual process so there was clearly some misunderstanding there.

[Deleted User]

did you complete an initial instruction form ? 

On there it usually covers all the details and specifically asks if the purchase is by way of a mortgage, how much deposit, where those funds have come from etc

Its clear the solicitors have failed in their money laundering checks, because you never had 100% of the purchase price, as they never checked.

No wonder the solicitor has been replaced by a supervisor, they clearly know the mistake they have committed  

Thrugelmir

ekeenan said:

Looking through emails we weren't really walked through the process. 

Did you ever go into the solicitors offices to discuss the transaction or did you undertake everything remotely?  
Would appear that everybody else in the transaction, your solicitors, the vendors solicitors , the estate agent and the vendor themselves were under the impression that you required no mortgage. Suggesting that something has led them to believe this. Any idea what this could be? 

flower77g

Regardless of who is at fault - and the completion date is formally agreed - it might be that one way forward is to seek a bridging loan before the date of completion.  Yes, this will be expensive, and time is running out, but it removes the other problems, and potentially the extra cost could be sought from the solicitor at a later date if they have acted erroneously.   If this is part of a chain the costs of not completing on a formally agreed date of completion could rapidly escalate.