Found out house at risk of repossession 4 months after offer accepted

jonnydeppiwish!

Given there is a current sale going through, and assuming the vendor has enough money to pay the mortgage, it would be unlikely the house is repossessed when you’re so close. No bank wants to spend all the time and hassle on a repossession when a sale can be had within weeks.

mlz1413

Take a deep breath and release, repeat twice more.

Ok. You are in the best position to buy this house as you are at.the end of the process.
If the debts are to the estate management company they will be glad to see the people who owe them are leaving. But they probably want to ensure there is enough money for their debts when the house is sold.

Estate managers AND solicitors are two of the slowest people you will ever work with. 

The one week 'deadline' by the EA is ridiculous,  you have no control over the timing, only the sellers solicitors and EM can push this through. 

I'd go back to the EA and ask what the one week deadline is based on?
And tell them to get their clients to push there solicitor.
Remember no one is in a position to beat you past the post on this purchase!

What an awful and stressful thing to go through as 1st time buyers!  Literally as you are getting excited you have this to deal with.

Honestly keep taking deep breathes, complain when it is all over, let everything happen at its own pace.

EssexGirl

As it's been tenanted until a couple of weeks ago, have you been to check the condition of the property since they have moved out? 

Section62

buddy2024 said:

...

We are concerned that the estate agent/seller has withheld this repo infomation. Do we have any grounds to report them to trading standards? I know they should inform buyers about issues with house structure/land but I couldn't find anything on repo. As we have already spent money on a survey and solicitors fees which would be lost if it got repossessed and we couldn't buy it from the lender.

Do you know when the bank started the repossession process?  The vendor/EA can't inform you about an issue which hasn't happened yet, and 4 months ago it is possible everything was Ok.

The key thing (if you have a claim) may be how promptly you were informed of changing circumstances.

Section62

mlz1413 said:

Ok. You are in the best position to buy this house as you are at.the end of the process.

....

Remember no one is in a position to beat you past the post on this purchase!

Until contracts are exchanged anyone could come along and make an offer which is more attractive to the vendor than the OP's is.

buddy2024

EssexGirl said:

As it's been tenanted until a couple of weeks ago, have you been to check the condition of the property since they have moved out? 

Yeah we went to see after it was empty, a couple days before the estate agent emailed about the one week deadline. It just needs a clean and some minor repairs.

saajan_12

buddy2024 said:

We are concerned that the estate agent/seller has withheld this repo infomation. Do we have any grounds to report them to trading standards? I know they should inform buyers about issues with house structure/land but I couldn't find anything on repo. As we have already spent money on a survey and solicitors fees which would be lost if it got repossessed and we couldn't buy it from the lender.

I doubt it - they are obliged to tell you things that they know and would dissuade most buyers from buying the house. A repossession is about an issue with the owner's credit, not with the house and usually a repossession will hold off if a sale is imminent as they'd save repossession costs so wouldn't be a deterrent to buying the house. 

buddy2024

Section62 said:

buddy2024 said:

...

We are concerned that the estate agent/seller has withheld this repo infomation. Do we have any grounds to report them to trading standards? I know they should inform buyers about issues with house structure/land but I couldn't find anything on repo. As we have already spent money on a survey and solicitors fees which would be lost if it got repossessed and we couldn't buy it from the lender.

Do you know when the bank started the repossession process?  The vendor/EA can't inform you about an issue which hasn't happened yet, and 4 months ago it is possible everything was Ok.

The key thing (if you have a claim) may be how promptly you were informed of changing circumstances.

We have no idea. We have asked these questions to the estate agent and they are supposedly finding out the answer. Our solicitor also hasn't been told anything yet and is trying to find out.

GDB2222

I can see why the estate agent is panicking. He’s in danger of losing his commission. 

You are  keen to progress the purchase, but you are in a strong position to make an offer for the property after it’s been repossessed, too. So, stop and consider whether that’s better for you. You may get it more cheaply (or it may become more expensive). But, the chief advantage is that lenders are straightforward people to deal with, in my experience, whereas your current seller is awkward. 

As SDLT Geek said, you could exchange contracts with the seller, but he might not be able to complete if he owes more than the sale price. Repossession solves all those issues for you. 

buddy2024

Thank you everyone for the advice so far, it is really helpful!

We just received an email from the estate agent/seller responding to a series of questions we asked about the repossession.

We are now under the impression that the house will not be repossessed within 1 week (it was a lie) and the seller is simply worried about accumulating debt due to tenants no longer paying rent to pay for the mortgage. The seller has stated that their solicitor has not contacted the lender yet either, so the previous email from the estate agent saying the seller has got an 'extension' from the lender is also a lie.

The seller had previously requested for completion to be delayed, which was to prevent the seller from paying an early penalty fee from the lender. However, if he is so worried about accumulating debt, he should not be requesting for us to push back completion dates. The date for completion to be delayed to, was also the day before the supposed repossession date.

The estate agent is also claiming to have informed our solicitor of the repossession risk a month ago. Our solicitor has stated they only found out this week, the same day as us. However, the estate agent is now referring to it as a repossession risk, and not that the house will be repossessed (which they worded it as previously).

We are extremely annoyed by the situation the seller and estate agent have caused. It seems like the seller has not been honest with us and has tried to fabricate a situation just to complete when they wanted to.