House Purchase Exchange Unrealistic Timeline - Guidance Needed

Charlie1985

Hi All,

We are looking for some advice on how to handle a predicament we are in. We have had an offer accepted on a property we like (£645k) however from the mortgage valuation we got down valued by £13k. We went back to the estate agents and after a struggle they advised the vendors would be willing to meet at £640k. As we like the property we thought this would be ok. The agents then came back with a stipulation to say that we need to exchange by 31st Oct else the price will revert back to the original price (£645k).

The issue we have is our solicitors have advised our searches are still in progress and the last local area search is due back 31st Oct. Our solicitors have advised it’s too early to discuss timescales and the estate agents are saying there is nothing they can do.

Today the estate agents have issued a revised Sales Memorandum but added a stipulation exchange needs to happen by 30th Oct else the price will revert. We can get our mortgage offer amended however don’t want to  go through all this hassle if we will miss the deadline of 30th Oct as we appreciate our solicitors will need to review the search results, ensure all enquiries have been satisfied and then give us the go ahead. Feels like we have been set an unrealistic timeline which is out of our hands. We feel uncomfortable to exchange without our solicitor completing their checks. Estate agents keep saying this instruction has come from the vendors. To note the agents are quite rude and would prefer for both parties solicitors to discuss this matter.

Has anybody had any similar experiences with estate agents? What is the urgency for exchange? We would be really grateful to get peoples suggestions on how best we should proceed and handle this matter.

Many thanks in advance.

Charlie

user1977

Charlie1985 said:

What is the urgency for exchange?

Have you not asked the agents?

Put bluntly, what do you think the sellers are likely to do if it gets to 30 October and you don't agree to the price going up? Pull out and try to start from scratch with another buyer, for the sake of an extra 0.8% on the price?

(as an aside, I don't think 2% is really much of a "downvalue" - that's well within normal valuation margin of error)

Charlie1985

Have asked the agents they have said they are following the vendors instructions. No further detail has been shared.

Bigphil1474

I would tell them you are unlikely to meet that deadline and will pull out if the vendors insist. See what comes back. What if the searches come back with something that needs querying? We had a chain of 3 / 4 agreed sales in April this year but it still took until July for the solicitors to even talk about exchange dates, and 3 of us sellers had to collude to agree a date and all put it to our solicitors so we could move early August. (The 4th was an empty house) 

housebuyer143

You need to call their bluff. They have overvalued the house, in a slow market. The next buyer will likely have the same issue and try and haggle them down. I don't think they are going to lose your as a buyer over £5k. 

I wouldn't even entertain exchange, it's completely ludicrous if the searches haven't come back and your solicitor will not let you, because if something is wrong you might not get your mortgage monies but you have committed to purchasing it. It's a big NO.

Politely go back and tell them you will only be purchasing the property at the agreed price of £640k and you feel that is more than fair as the property is only worth £630k. Explain you are in no position to exchange as the searches and enquiries haven't been done and the fact that the seller is pushing for such an unreasonable timescale makes you worry that there is something untoward going on, maybe an issue with the house? 

Hold your ground if you want that reduction. Otherwise tell them you can't meet that deadline as it's completely unreasonable and proceed with the original price.

Gentoo365

You won't meet the deadline. That's my prediction.

The delay could be due to the sellers solicitor being slow, or delays in some information from a third party. Totally out of your control.

I wouldn't agree to this. Or I would agree but then drop out after the date is not met and gamble they will just reconsider.

pinkshoes

I'd be suspicious WHY they want to exchange so quickly...  (what are they hiding???)


If the end of October exchange is unrealistic then you might as well pull out now rather than waste money on further search costs. Or accept and find the £5k increase from somewhere.

Do you like the house? Are there others available? Are you in a chain?

EssexHebridean

Ask your solicitors to confirm whether this is the case from the seller's solicitors, for a start. The solicitors can then ascertain between themselves whether this is a serious threat or not. If you are unable to proceed on that basis, then you need to be clear about that too - although you may wish to keep your powder dry on that as far as the sellers are concerned until a little closer to the end of the month. Allowing that your searches have already been ordered then you have little to lose by sitting tight for another 10 days or so. 

The agents are very possibly driving this as they want their commission by the end of the month allowing they've just seen a small drop in it too. The agents are also not in a position to decide whether that proposal is realistic or not (by the sound of it probably not). 

Getting the offer amended is going to take time in itself, but equally, if the sellers go back to the market then they have to start from scratch anyway.  

BonaDea

A lot of people are expecting capital gains tax to rise from midnight on 30 October so perhaps that's what's driving this.  If the last local area search isn't due back till then, you could take a view on what reduction in price you might accept to induce you to forego waiting for that search.  Otherwise, if they are trying to avoid additional CGT liability, they stand no chance of doing so with you or with an alternative buyer.  After 30 Oct their next buyer's lender might only value at £632K as well, that buyer might not be willing to sink an extra £8K of their own funds into it, and they'd have the extra CGT to find.  And the vendors will have all the costs they've expended and will expend to take into account.  So I'd have thought it was a no-brainer from their p.o.v to offer you a reduction to abandon the final search and exchange by their deadline.

housebuyer143

BonaDea said:

A lot of people are expecting capital gains tax to rise from midnight on 30 October so perhaps that's what's driving this.  If the last local area search isn't due back till then, you could take a view on what reduction in price you might accept to induce you to forego waiting for that search.  Otherwise, if they are trying to avoid additional CGT liability, they stand no chance of doing so with you or with an alternative buyer.  After 30 Oct their next buyer's lender might only value at £632K as well, that buyer might not be willing to sink an extra £8K of their own funds into it, and they'd have the extra CGT to find.  And the vendors will have all the costs they've expended and will expend to take into account.  So I'd have thought it was a no-brainer from their p.o.v to offer you a reduction to abandon the final search and exchange by their deadline.

But they need to complete by 30th to avoid it, not exchange. They are not asking the OP to complete, so I doubt that's the reason.
No reduction should encourage the OP to exchange without the searches and completed enquiries, because they might end up with no mortgage monies and a house they are committed to buy. 

Albermarle

I would be clear and say that we will not be in a position to exchange by Oct 30TH, and we are not going to agree to an increased price, so what do you propose? to stop the process now?
Puts the ball firmly back in their court.