Sale to HK buyer looking flaky at the last second

WorriedBuyer2021

I started 'sold' my house back in mid May this year and shortly afterwards found my onward purchase. Legal proceedings for both transactions were initiated shortly afterwards. My cash buyer lives in Hong Kong but his daughter is living in the UK and starting uni in Sept. He was keen to complete by end of August so that his daughter could settle. My seller has not yet found their onward purchase and intended to rent somewhere in the meantime.

Since about late July, both my seller and myself have been over-optimistically promised exchange in "a week or two". Concerned by the timescales reported, I (also over-optimistically) moved some possessions into storage and completely emptied my property. My seller actively investigated moving into rental accommodation, found a rental, and since July has repeatedly delayed signing the rental agreement, as they were understandably advised not to sign it without first having exchanged contracts. They've kept putting this off each time the estate agent's promises turned out to be hot air.

In general, my purchase has progressed smoothly and my sale has been quite slow (e.g. multiple and drawn out enquiries, delays with correspondence, etc). My contract was ready to exchange for the purchase in July and was ready for my sale in late August.

Fast forward to a couple of weeks ago and a panic ensues that I am still not ready to exchange on my sale and as a result my seller will have to again delay signing their rental, changing the proposed completion date. The seller also did not know my buyer was international and this worried them. Yes, the process has been slow, but it's only been a problem because of misinformation from the estate agent. Anyway, eventually my HK buyer received their contract to sign and after nail biting worries about it being returned to UK from HK, the signed contract arrives back in the UK and we are finally ready to exchange on the Monday just gone. This has been nerve wracking because I have been informed by the seller that if we don't exchange imminently, the completion date will move to after the stamp duty deadline (for reasons to do with arranging their onward rental). 

But we don't exchange on Monday because, late in the day, a solicitor in our small chain has contacted the wrong client by accident. I am not worried though, because everyone in the change insists that we will exchange tomorrow instead. The morning comes and we can't exchange because my buyer will no longer release (approve) the transaction because they now insist on having my buyer's total balance on account, not just their deposit, as my sale is supposed to be completing just four days later (the purchase a week later than that). By now this is just another frustrating hurdle in what thus far has been the most ridiculous experience of my life. I've purposefully tried to keep this short, but suffice it to say there are more anecdotes than this main story arc.

Well tomorrow is supposed to be completion of my sale but it's not happening. My HK buyer is having difficulty sending the funds to their solicitor. They've been trying every day for four days to get their bank to do the transfer, and I have no information about what the problem is. As a result, we now have until midday tomorrow (Friday) for the money to arrive and for exchange to take place, else my seller will not be able to complete until October (again, due to the rental). This delay would cost me about £4k in fees.

Nearly getting to the meat of the matter, my seller has pointed me a news piece saying that Chinese citizens cannot send large sums of money abroad, and they're prohibited  from sending money abroad to buy property. Notably of course, my buyer is not Chinese - they are from Hong Kong, and I'm hopeful that's a crucial difference. But it has got me worrying; what if the money never arrives? In a way, I'm resigned  to the increased costs of further delay, but if it doesn't arrive at all then both transactions will fall  through. I've spent about £5k in fees by this point. If it did go wrong (I'm trying to stay optimistic, believe it or not), how did we get to the day of completion without any of the professionals, particularly the buyer's solicitor,  venturing to suggest that sending money from Hong Kong might be problematic? Incidentally, my solicitor was told the funds were in a UK bank account, which they may or may not be. There's a chance my solicitor was misled. As always, despite asking for clarity, I have very little information and as of today, the funds have not arrived.

Hopefully, I'm worrying without cause and the money will just show up. But if it doesn't, can I hold anyone responsible for letting all three parties get so  deep down the  rabbit hole, only for something as blindingly obvious as the integrity of my buyer's funds to derail everything? I thought solicitors checked funds in detail? I virtually had to provide a specimen to even be allowed to view a property.

Thanks for your advice, if you have any.

Slithery

WorriedBuyer2021 said:

can I hold anyone responsible for letting all three parties get so  deep down the  rabbit hole, only for something as blindingly obvious as the integrity of my buyer's funds to derail everything?

Yes, your buyer is responsible.
Though until contracts are exchanged either party can pull out at any time for any reason with no comeback against them.

Tiglet2

Solicitors would ask for proof of funds during their ID checks, but it is the responsibility of the client to transfer those funds to the solicitor in time for completion.  If the client doesn't transfer the funds, by whatever method they legally can, then they cannot complete, but if contracts have not been exchanged, then no breach of the contract has taken place and no party can be held responsible.

I am sorry that you have had all these issues.

Thrugelmir

WorriedBuyer2021 said:

My HK buyer is having difficulty sending the funds to their solicitor. 

Your buyer seems to want to dictate the speed of the transaction.  Speculating about their motives is pointless. You'll never no the real reason. Being a non UK resident must have created additional work for the solicitor here. 

AdrianC

WorriedBuyer2021 said:

Nearly getting to the meat of the matter, my seller has pointed me a news piece saying that Chinese citizens cannot send large sums of money abroad, and they're prohibited  from sending money abroad to buy property. Notably of course, my buyer is not Chinese - they are from Hong Kong, and I'm hopeful that's a crucial difference.

Not since 1997, and especially not in the last couple of years.

Hong Kong is China.

Of course, we don't know what nationality your buyer is - the fact they live in HK doesn't necessarily mean they're a Chinese national.

elsien

A relative has had a buyer from Hong Kong purchase an expensive property next to him, in the last couple of months.

Of course there may be no similarity in the way they and your buyer operate their finances. But it was still possible a couple of months ago.

https://www.google.co.uk/amp/s/uk.finance.yahoo.com/amphtml/news/london-property-markets-real-estate-hong-kong-uk-visa-china-economy-142213388.html

gemma.zhang

This might have been surprise to your buyer also if they haven’t done it before.

Chinese mainland or HK residents sending large amount of lump sum to UK account is always subject to money laundary check (sometimes twice by bank in hk and uk)! Even for small sum of 40k, let along hundred of thousands of pounds. 

Normally is fine, just takes long time, as the bank wants check verification reasons etc. When my mum sent 40k over last time it was held up in HK Hsbc, but released very shortly once all the questions are answered.

Hope it will go smoothly soon! 

knightstyle

Over two years ago we had a HK buyer with a daughter in UK they wanted to buy, cash, our house for. Absolute nightmare! She came five times to look, asked lots of questions before agreeing to buy then like you we were messed around with one delay after another before we finally gave up.

maxsteam

WorriedBuyer2021 said:

my buyer is not Chinese - they are from Hong Kong

Omg. In some countries you could be locked up for saying that.