Failure to complete, has anyone experienced this?

MrandMrsW

We are first time buyers and exchanged contracts on our first home on the 7th December, we were supposed to complete the purchase on last Friday, the 14th.
On completion day it transpired that 3rd house in the chain has had a notice of interest registered against the property by an ex-partner, meaning that our vendors cannot complete on their purchase. After packing up, moving out and handing their keys to the estate agent and driving to their new home, they have now moved back into the house that was supposed to be ours and intend to stay there over Christmas. We do not wish to see them homeless, but is very frustrating for us and everything is up in the air. Our solicitor has put a 'notice to complete' on our vendors solicitor, demanding that they complete within 10 days (which takes us to the 3rd Jan) what happens if they cannot buy the house they wanted? Who do we recover our costs from, them or the seller above them who has caused all the problems?
Our solicitor is advising us to hang tight till the 10 days are up, but he has no experience of the situation so we were wondering if anyone else has gone through this situation or has heard of it happening before???
Thanks

MarkyMarkD

The individual who has failed to complete is your vendor. It is irrelevant to you what their excuse is - they are liable to compensate you for the failure to complete.

Your solicitor should be able to give you sensible advice - that's what you are paying him for. Not having experienced it himself is no excuse.

silvercar

In these situations you have to act in your own interests. Their solicitor should be advising them and your solicitor is following correct procedure. They have to give you vacant possession and pay any costs you have incured by their failure to move out. You recover your costs from your seller and they can recover your costs and their own from their seller. If their purchase fails to complete in 10 days and they refuse to vacate the house they have sold to you, the next step is to go to court and order them to vacate. They will then have to go into rented. The longer they delay the higher their costs will be.

pepperjulie

If you have exchanged contracts it has now become legally binding therefore the house is now legally yours regardless of if you have completed or not. I'd advise speaking to your solicitor

MarkyMarkD

I don't think you are quite right, Julie. Once exchange has occurred, the two parties are legally required to complete, but completion is not automatic.

bazza1603

My heart goes out to you....

Should this not have been picked up earlier??

MrandMrsW

Thanks for all your advice guys-it all seems to make sense. The only thing that may make a difference is that although we have paid the deposit the rest of the funds were not paid due to the failure to complete. Would this change things?

PasturesNew

They should be moving out into rented.
On the basis somebody has to, it should be them.

Their problem should not become your problem.
If you've bought their house, they're not short of a bob or two either, so booking into a hotel, renting a holiday caravan while they sort out a house to rent etc isn't out of the question.

Your solicitor will deal with this, but you will be compensated financially.

jamesd

MrandMrsW, the funds should never be paid unless completion happens, so that's the expected result. No completion so no security for the mortgage, so the mortgage lender would demand their money back if it had been handed over, because they have no security for their money until they have the charge on your property.

Sugarplumfairy_2

I am in a situation like this althought not exactly the same.

Exchange date 04 December (Scotland). Had call from solicitor 4 o'clock on 03 December advising that the buyers mortgage was not completed and there was a chance no funds would be transferred on 04/12 so I could sit tight and wait and if funds did go thru by 1430 04/12 I would have to vacate there and then. Or move to my new house as planned and apply for bridging loan which buyer would pay for if funds did not transfer.

So .... more than 2 weeks down the line and still no money for my house. Have been advised by the solicitor that they are still waiting for the mortgage to be released due to them being self employed and delay was caused by waiting on inland revenue for proof of earnings. Solicitor advises that they cannot pull out now as contract legally binding and can sue their asses off.

Getting desperate now as Christmas is upon us and if this is not completed by friday then solicitors is closed til after new year. So I have an empty property which I am still liable for that may be empty for another 2 weeks !!!

Never moving again !!

freebo_2

Really sorry to hear that, I'm no legal expert but can tell you what happened to us (which was nowhere near as bad but may have some relevance).

We where 3rd up a 4 party chain, due to complete on a particular Monday last year, our buyers where downsizing and our vendors going into rented while their self build was completed. The bottom of the chain (our buyers-buyers) had a problem getting their funds released and this meant that the chain could not complete on the nominated day so we completed a day late (although through a solicitors agreement we got the keys at 5.15PM on the Monday).

Bottom line was everyone claimed lost interest from everyone else, so our vendors claimed a day's interest from us, we claimed a days interest from our buyer and our buyer did the same to their buyer. We actually ended up out of pocket, although it wasn't any of our fault! Although only by about £50 in interest. Our Sols tried to reclaim it and the £100 overtime we had to pay the removal guys but was basically ignored and he told it wasn't worth the effort to persue it.

Thing is I thought we should have all had some sort of automatic redress on the bottom of the chain for failing to complete on time (which was an investor buying a £500K house BTW), but it seems not.

Sorry to ramble & I really hope it all gets resolved for you & you enjoy your new house!