Exactly why you don’t want a long gap between exchange and completion!

NameUnavailable

There have been a few Covid related cases reported where the offer was withdrawn after exchange due to the buyers finding that they had suddenly lost their jobs.

It's obviously a problem as many solicitors are trying for exhange and completion on the same day. With growing unemployment and all the other factors affecting the economy at present it's only going to get worse.

Jumblebumble

Sibbers123 said:

https://www.financialreporter.co.uk/features/couple-lose-life-savings-as-buyers-lender-withdraws-post-contract.html?fbclid=IwAR2LKYUTtzjnn7u07s5uSQIGmulSVsrkTn8WX00pKtCvnHXdA1z_42XvS4o

What a nightmare!

This is very uncommon and we are not getting the whole story
The Article is scaremongering
We would be hearing about it and we havn't by and large
The Building society are under a duty to treat customers fairly
Any lender who made a habit of this would not last long as the reputational damage would kill them

TBagpuss

The quote in the article 
"It has been widely assumed by mortgage brokers and homebuyers alike that a mortgage deal in place at exchange cannot be withdrawn before completion"
really jumped out at me because I would have thought that any competent  mortgage broker would know perfectly well that the offer could be withdrawn in that period. Of course it's very rare, but it can happen, and it is one of the reasons why it's normal to have a pretty short gap between exchange and completion, because  it reduces the risk of the buyer's circumstances changing and their offer being withdrawn. 

TBagpuss

AskAsk said:

i think if you were buying and paid the deposit but didn't get to move into the purchase, then you can get the deposit back, but you have to do so through the courts.  i thought you could ask the solicitors, who were keeping the deposit as they are not paid to the seller until completion would pay it back, but apprently not so.

No you don't. When you exchange, you enter into a legally binding contract to complete. f you then don't complete, then you lose your deposit, the seller gets to keep it as compensation for your breaking the contract with them. They may also be able to sue you for any additional losses they suffer as a result. 

If you were buying, had paid the deposit to your conveyancer in preparation for exchange, but didn't exchange, then of course you would get your deposit back. 

in practice, delayed completion is often a temporary glitch and everyone negotiate to still complete, albeit late, and maybe with some payments from whoever caused the delay to cover costs of cancelled movers etc. but the only way of avoiding it completely is if you exchange and complete simultaneously, which has its own issues as it means you don't know for certain until the day whether or not you are actually moving!