Can't exchange contracts without long stop date

Phil_87

Hi, I'm currently trying to resolve a problem with buying a new build house which won't be complete until at least March next year.

We're almost ready to exchange contracts but my solicitor has advised me not to proceed because the builder won't agree to add a long stop date to the contract (to allow me to be released from the contract if they don't complete the house before my mortgage offer expires). I'm going to talk to the building company to see if they will reconsider this or if they can provide any other assurances, but I don't know what I can say that will persuade them.

If anyone has any advice on what I should do it would be greatly appreciated, because it looks like I might have to cancel the purchase of this house, and I really don't want to do that.

davidmcn

Just tell them you're aware it's standard practice these days for there to be a long stop date, and no other buyer will be signing up without one (unless they're crazy).

princeofpounds

Are you intending to use a mortgage?

Generally it's a really bad idea to exchange without a long stop. They can take forever to finish it and still bind you. The reason they won't commit is probably because they have low confidence they can meet it. (Not necessarily that low, just not high enough). It's too far away and Covid is probably an issue.

Ask the builders when they would commit to a long stop date. Come back to the transaction around then if you don't find something better in the meantime.

pinkteapot

There was a story on here recently about someone stuck in a contract with no long-stop where the build is now over two years late. Be prepared to walk away. 

Phil_87

Thanks for the quick replies

davidmcn said:

Just tell them you're aware it's standard practice these days for there to be a long stop date, and no other buyer will be signing up without one (unless they're crazy).

This is what I've been thinking, if I pull out they'd have to find another buyer who is willing to take a ridiculous risk.

princeofpounds said:

Are you intending to use a mortgage?

Generally it's a really bad idea to exchange without a long stop. They can take forever to finish it and still bind you. The reason they won't commit is probably because they have low confidence they can meet it. (Not necessarily that low, just not high enough). It's too far away and Covid is probably an issue.

Ask the builders when they would commit to a long stop date. Come back to the transaction around then if you don't find something better in the meantime.

Yes I need a mortgage and already have a mortgage offer in place. I've also been thinking of asking them when they could commit to a long stop.

pinkteapot said:

There was a story on here recently about someone stuck in a contract with no long-stop where the build is now over two years late. Be prepared to walk away. 

That's scary, I definitely don't want to be in that situation.

princeofpounds

well one scary situation could be that you exchange, it takes so long your mortgage offer expires, and you find you can't raise a new one (for whatever reason). 

Carl2510

My long stop date is 6 months 

Phil_87

Yes that's something my solicitor mentioned which is why they recommended that I don't proceed without the long stop.

Scotbot

Do not exchange without a long stop date. The risk for you is that something happens  such as the builder going bust and not finishing the job or your mortgage expiring and you not being able to get another one  or some unforeseen covid related delay. Then you lose your deposit. Obviously no long stop date means no risk to the builder. 
TBH I  can't see why a builder would refuse a long stop unless they are in financial difficulties as it is standard practice .

rik111

If they refuse a long stop date, ask them what the problem is. Do they have no confidence in the build being finished on time ? I would even reverse the roles and say you are considering pulling out as you have lost all confidence that the house will be finished in time.
Remember the sales people do this all the time and have no emotional interest so play games to get their buyers to do what they are told. Just read the amount of threads about them threatening buyers if they do this and that....

Thrugelmir

rik111 said:

If they refuse a long stop date, ask them what the problem is.

Problem is Covid during the winter months. Not surprising they are hesitant at the current time. Lockdowns, weather, staff absence, supply shortages the list of factors goes on.