Notice to complete issued what does this mean in reality.

jeps

Grateful for any advice please.

We are selling an unoccupied property, no chain. Accepted offer in August, buyers lender took months to issue mortgage offer. Buyer is purchasing property to rent.  When the mortgage finally came through in early December it was already due to expire on 23/12/20. Not enough time to exchange and complete before expiry. So they needed to apply for extension. This was ‘sorted out’ and we eventually exchanged contracts on 22/12/20 agreeing today as completion date. 

Our solicitor contacted us yesterday to say there was a problem. Apparently the extension to the mortgage was a verbal agreement and the buyers solicitor exchanged on that basis but when they chased the release of the funds on Monday they were told that there needed to be a physical revaluation of the property which will not take place until Monday 11th and then they will possibly get mortgage offer on Tuesday. I have grave doubts that this will happen. The property needs extensive renovation and I think the buyer is possibly over extending himself. 

My solicitor has issued a notice to complete today. Unfortunately she is less than helpful when it comes to explaining things. So I want to check my understanding of what this means in practice if as I suspect the buyer doesn’t get the mortgage. 

My understanding is that if the buyer fails to complete within 10 working days of the notice being issued then he is in breach of contract and we can put the property back on the market. He also forfeits his deposit? If this is the case do we automatically get the deposit or do we have to take further legal action? If so what will that involve.

Peppermint90

But why do you want to take buyers deposit 

Mineral1

Please don't take the buyers deposit, even if you are entitled to it you're screwing someones life savings up potentially, and for what?

SpiderLegs

Peppermint90 said:

But why do you want to take buyers deposit 

Maybe the OP wants to stick it all on Foxy bingo? *


*other bingo sites are available.

jeps

I don’t want to take anything I just want him to complete however there is far more to this saga than I thought necessary to this thread.

But in short we have been messed around by him and his solicitor. We have been lied to and misled. We could have accepted another offer which was actually higher but as they were in a chain and we were led to believe that this guys finances were in order and he was ready to buy we accepted his offer. Our solicitor was ready to compete in September...we are now in January. Each month that passes by is costing us money in council tax and electricity. If the sale doesn’t go through then I will also have to reinsure the property as the current insurance expires at the end of this month. If we have to put the property back on the market then potentially we have months of more bills and extra solicitors costs. 

I don’t think it’s unreasonable to expect some compensation in relation to these costs. I don’t expect or want to profit from this and wouldn’t want the entire deposit but I want to know where we stand in regards to getting this. 

steve866

How has the buyers solicitor let them exchange without a formal mortgage offer extension? 

jeps

A very good question which if I was the buyer I would be asking of his solicitor. 

His solicitor states it was agreed verbally by phone. Which to me seems bizarre. 

I really hope he is offered the mortgage following revaluation but if he is not then I do wonder if he would have a case against his solicitor for not getting a formal extension.

binao

A friends buyer kept stalling. They  "Borrowed", a for sale board and stuck it in the hedge one dark night.

Buyer drove by next day. All now  "done and dusted".

Good luck.

kiddy_guy

If they have exchanged and not completed then the seller is out of pocket in terms of their solicitors costs. equally they have now lost the opportunity to sell into the market which will have reduced stamp duty.  them a reduction in their selling price.

They should absolutely keep the deposit until the point of which they sell the property to to either the current buyer or another buyer. If the seller has to take a hit on their selling price then this should come out the deposit.
I think it's very naive to suggest that the seller should suck up all of the costs. 

General_Grant

Peppermint90 said:

But why do you want to take buyers deposit 

It might compensate for lower eventual sale price compared with what has been the agreed value some time ago.
Why enter into a contract, staking the deposit money, if you are not willing to risk losing it?

ETA:  I now see that there wasn't enough time to "exchange and complete" so perhaps there was no exchange of contracts and therefore no deposit.

jimbog

Peppermint90 said:

But why do you want to take buyers deposit 

Probably doesn't 'want to' but it would recompense for  losses incurred