Buyer might be pulling out and new build reservation meeting next week!

GDB2222

jls85 said:

Thanks guys. 
Turns out the buyer has decided to proceed anyway so crisis averted in that respect. As for it being risky to exchange now for completion in June, I wasn't aware of any big risks with that no. That's how it worked when I bought my last new build and as Carl said, I believe that's the only way to buy a new build? I will do a bit of digging though to find out what you are getting at though.

If you lose your job at any time between now and next June, your mortgage offer will probably be withdrawn. If that happens, you won't be able to complete your purchase of the new property, and you'll lose your deposit. The developer can sue you for much more than that, but usually they just take the deposit.  In these uncertain times, that's rather a big risk to take.

I'm sure you won't believe me, but maybe you'll believe this:
https://www.thisismoney.co.uk/money/mortgageshome/article-8323901/Im-worried-job-lender-withdraw-mortgage-offer.html

jls85

Thanks everyone, I hadn't thought about that so it's good to know and I will discuss it with my boyfriend before we do anything. Our developer has asked for a £2k deposit on exchange then the rest would be due around completion, is it the £2k we would lose or could they come after the whole 15% deposit?
And I'm not really sure why you think I wouldn't believe you GDB2222, but thank you for the link. 

GDB2222

Your liability is unlimited, ie you are liable for all their losses. If they contracted to sell to you for £200k, but because there's a recession they end up selling for £150k, they can sue you for £50k.  That's obviously been rare over the last few years, as prices have tended to rise.

When you exchange contracts, the normal deposit is 10%. Even if they accept a lower deposit at exchange, you're still liable to top it up to 10% if you fail to complete, and the full 10% will then be forfeited. That applies even if they find another buyer at the same price as you, ie they don't have any losses. 

Crashy_Time

GDB2222 said:

jls85 said:

Thanks guys. 
Turns out the buyer has decided to proceed anyway so crisis averted in that respect. As for it being risky to exchange now for completion in June, I wasn't aware of any big risks with that no. That's how it worked when I bought my last new build and as Carl said, I believe that's the only way to buy a new build? I will do a bit of digging though to find out what you are getting at though.

If you lose your job at any time between now and next June, your mortgage offer will probably be withdrawn. If that happens, you won't be able to complete your purchase of the new property, and you'll lose your deposit. The developer can sue you for much more than that, but usually they just take the deposit.  In these uncertain times, that's rather a big risk to take.

I'm sure you won't believe me, but maybe you'll believe this:
https://www.thisismoney.co.uk/money/mortgageshome/article-8323901/Im-worried-job-lender-withdraw-mortgage-offer.html

Good advice.