pulling out of buying flat

matt90sw

Okay, I had a offer accepted of 162k for a one bed flat in Bristol on 5/10/19, I was told I'd be in by christmas as there was no chain. After so many delays I'm still not in and have had my mortgage offer extended for a second time. 
Given the current situation I'm really unsure what the future holds as I've been put on fulough. If I pull out now what is it going to cost me? Do I still need to pay solicitors etc.
I'm very worried there may be a crash and when I come to remortgage in 2 years the flat would be in negative equity and I will not be offered another mortgage. This is my first time buying and its been an absolute nightmare, I'm getting bad feelings about the whole thing.

greatcrested

Hard to comment without knowing the reasons for the delays.

If you pull out, you'll lose whatever you've paid or commited to pay so far. Likely

Mortgage application fee; valuation/survey fee; legal fees to date; searches;

matt90sw

I've paid for everything you said above, surveys, mortgage fees, deeds, I'm in about £1200 so far and I guess I'd have to pay solicitors after aswell? Reasons for delays have been allsorts, most recent was there was no document to say the groundrent would never exceed a certain amount for me to lent the money. The solicitors were contacting the wrong freeholder for about 2 months which caused more delays and were generally very poor with communication.

Windofchange

If you pull out then you'll lose whatever you have paid on solicitors, search fees etc - most likely a 4 figure sum I would have thought by now. I guess only you know how secure your job is - I wouldn't want to take on a mortgage if I was unemployed. In terms of a crash, well nobody knows. Put 100 people in a room and 20 would say yes, 20 would say no and 60 would sit on the fence. I'm still going ahead with my purchase as soon as restrictions are lifted, and I'm not bothered about short term decreases in value as we see ourselves there for decades. I'm only on a two year fix as well, but I would be in the 20 people who don't see a catastrophic crash in prices in my area. Bit of a wobble yes, but huge drops no. You pays yer money and you take yer pick. However educated, nobody here or anywhere else can predict what is going to happen to house prices. 

numbercruncher8

The only sensible decision if you are having uncertainty in the future is to pull out. 
You'll lose whatever money you've fronted up so far, but this won't compare to the costs if you are forced out by not affording it.
One thing nobody ever seems to do here is to advice people to look at the specific situation, and trundle out generalisations, which isn't how the market works as different properties will be affected differently. 
If you want a more informed discussion post a link of the property (or a similar one)......my guess is that 1-bedroom flats (in allc cities) sit in the vulnerable category... if prices fall people could go for 2 beds, may depend more on the specific market and your purchase price.... you may be insulated in a falling market if you get a bargain, if you overpay it may be doubly painful.

Tiglet2

OP, if you were told you would be in by Christmas by the EA, they were lying.  Buying a leasehold flat where there are legal issues to sort out will always take longer than a freehold property and 5 months is fairly typical.  Solicitors will refer to how long the transaction has taken by the date which your solicitor received the draft contract, not the date your offer was accepted.  Now that we have Covid-19, matters have slowed down because third parties are on furlough or working from home.

graphs

Pull out. You are about to get stung on October 2019 prices.

davidmcn

matt90sw said:

I've paid for everything you said above, surveys, mortgage fees, deeds, I'm in about £1200 so far and I guess I'd have to pay solicitors after as well?

Not sure what "deeds" you think you've paid for? Solicitors should have sent you terms of business at the start telling you what they'd be charging you for an abortive transaction, so assuming you've got that, go read it.

missile

I would want to pull out. Before I did I would ask you solicitor to confirm (in writing) what your liability would be if you do pull out. You might be liable for sellers costs too?

macman

missile said:

I would want to pull out. Before I did I would ask you solicitor to confirm (in writing) what your liability would be if you do pull out. You might be liable for sellers costs too?

No, there is no liability for any part of the vendor's costs, as exchange of contracts has not taken place.

blue_max_3

matt90sw said:

I'm very worried there may be a crash and when I come to remortgage in 2 years the flat would be in negative equity and I will not be offered another mortgage. This is my first time buying and its been an absolute nightmare, I'm getting bad feelings about the whole thing.

You don't need another mortgage when the two years are up. You are on a product and after the term, it will revert to the standard variable rate, or you can elect to go on another product if available. But you shouldn't need to remortgage.