Solicitor overpaid on completion - now want money back

eleyevee

I was wondering what people think of this...

We completed a very arduous sale and purchase back in April of this year, having started in November. The relationship with the solicitor was not great all the way through and we did issue a formal complaint at one stage (which was not responded to). After the complaint, they became a little better and at the end of April we completed. 

On completion day, we received a call from the solicitors to say that we had a 4 figure sum coming back to us. I questioned why as we did not think that we had anything owed but we told it was due to the mortgage redemption etc. They then paid that money into our account and sent a letter with a completion statement showing the amount we received back.

In the interim, I spoke with Halifax to confirm the redemption amount, they confirmed that there was nothing outstanding etc, so we carried on as normal.

Fast forward to today (4 weeks later), we have received a call and email from the solicitors that they made a mistake in calculation and we actually owe them a different 4 figure sum. 

I just want to understand if this has happened to anyone else and if so, what is best to do here? Obviously I feel really irked by this as I asked many times when told we had an amount coming back as it didn't seem right but was assured it was.

user1977

Have you checked (and understand) the figures yourself? If the solicitors are correct in saying that you owe the money then you owe the money, notwithstanding that they've messed you about a bit.

TripleH

Also ask for a reconciliation of your account so you know where this sum they say you owe comes from.

eleyevee

user1977 said:

Have you checked (and understand) the figures yourself? If the solicitors are correct in saying that you owe the money then you owe the money, notwithstanding that they've messed you about a bit.

I don't understand the figures and why this has even occurred when Halifax confirmed that there was nothing due. The amount is also differing now - I also don't understand why the sale hasn't been completed nearly 4 weeks on. It just screams of negligence, but I don't really know what to do.

eleyevee

TripleH said:

Also ask for a reconciliation of your account so you know where this sum they say you owe comes from.

The new statement puts the outstanding amount down as due for "Under payment of redemption of mortgage now required by

lender to discharge mortgage"

TripleH

Contact the Halifax and ask in writing for the breakdown of your account including outstanding balances.

It might be the Halifax who made the error rather than your solicitor.

user1977

Or it might be that the solicitor has paid the Halifax the correct amount, but by underpaying something else. But first step is to go through the figures.

Didn't you do this when you get the money back in the first place? Did it all make sense then? Might be easiest to ask the solicitors what has changed.

eleyevee

user1977 said:

Or it might be that the solicitor has paid the Halifax the correct amount, but by underpaying something else. But first step is to go through the figures.

Didn't you do this when you get the money back in the first place? Did it all make sense then? Might be easiest to ask the solicitors what has changed.

They gave us a completion statement and made sense at the time, it was down that the mortgage redemption was less than expected, solicitor couldn't say why when questioned so we accepted it as correct. When I spoke to Halifax they confirmed that nothing was outstanding and our "balance" is now exactly as it should be and what was agreed in mortgage offer letter. I confirmed this by looking back at the mortgage offer letter, so had no reason to believe that there was anything else outstanding.

This is where my confusion is with this now outstanding amount. Solicitor said in the mistake email "in the meantime lender have not removed the charge from [OLD HOUSE] pending receipt of the balance owing to them. I am making immediate arrangements to pay this now so that the mortgage can be removed from the title to the property in accordance with the terms of the undertaking we gave the buyers solicitors on completion". - So another question here as to why this is still outstanding 4 weeks on?

comeandgo

If the amount is outstanding you do have to pay, you can’t get out of it by saying you had already been told everything was settled.

user1977

eleyevee said:

user1977 said:

Or it might be that the solicitor has paid the Halifax the correct amount, but by underpaying something else. But first step is to go through the figures.

Didn't you do this when you get the money back in the first place? Did it all make sense then? Might be easiest to ask the solicitors what has changed.

This is where my confusion is with this now outstanding amount. Solicitor said in the mistake email "in the meantime lender have not removed the charge from [OLD HOUSE] pending receipt of the balance owing to them. I am making immediate arrangements to pay this now so that the mortgage can be removed from the title to the property in accordance with the terms of the undertaking we gave the buyers solicitors on completion". - So another question here as to why this is still outstanding 4 weeks on?

Which "mistake email" are you talking about here? The latest one? If so then it sounds like the solicitors have funded the shortfall to deal with the mortgage redemption out of their own funds - which is why Halifax are happy. But the solicitors need you to reimburse them.

Have you checked that the total amount paid to the Halifax is what you expected (e.g. it doesn't include an early redemption penalty which shouldn't have been paid)?

eleyevee

user1977 said:

eleyevee said:

user1977 said:

Or it might be that the solicitor has paid the Halifax the correct amount, but by underpaying something else. But first step is to go through the figures.

Didn't you do this when you get the money back in the first place? Did it all make sense then? Might be easiest to ask the solicitors what has changed.

This is where my confusion is with this now outstanding amount. Solicitor said in the mistake email "in the meantime lender have not removed the charge from [OLD HOUSE] pending receipt of the balance owing to them. I am making immediate arrangements to pay this now so that the mortgage can be removed from the title to the property in accordance with the terms of the undertaking we gave the buyers solicitors on completion". - So another question here as to why this is still outstanding 4 weeks on?

Which "mistake email" are you talking about here? The latest one? If so then it sounds like the solicitors have funded the shortfall to deal with the mortgage redemption out of their own funds - which is why Halifax are happy. But the solicitors need you to reimburse them.

Have you checked that the total amount paid to the Halifax is what you expected (e.g. it doesn't include an early redemption penalty which shouldn't have been paid)?

Sorry, todays email. I'm calling it the mistake email as that's the one where they have said they've made a mistake in calculation which is resulting in us owing the money.

The money to Halifax was correct from my understanding. We had an original completion statement that showed current mortgage redemption plus an early redemption charge (not due as we ported and this was confirmed by Halifax). 

Then we had a second comp stat that showed the mortgage redemption minus the early redemption charge. At this stage we owed them money for conveyancing, which we paid and this is why I didn't expect any amount back.

It was only on completion day that we were told actually that amount is incorrect and therefore we had money coming back, which was paid. When I look at that comp stat mortgage redemption amount minus early repayment it is just shy of 10k less than the second comp stat. 

Todays revised comp stat states that there is an underpayment of just over 8k. So still doesn't add up correctly.