Completion statement issued after completion - £20k+ owed

silvercar

If the broker applied for the wrong amount, they should hold some liability. What is the broker’s view?

it could well be that the solicitor was slow in getting you the completion statement and they should hold some responsibility for that. It may well be that they used money earmarked for the stamp duty to cover this in the short term.

ExEstateAgent

Surely they solicitors couldn't complete without having confirmed payment in full had been made? Something amiss here! 

1122abc

SDLT_Geek said:

mta999 said:

This is very unusual - obviously the solicitor has to wire the funds to the seller on completion and the seems to be a 20K shortfall so where did that 20k come from?

 I doubt it came from their client account.

I wonder how much the stamp duty is?  There is 14 days to pay this.  Perhaps the solicitor was able to complete with the money available and needs the £20K shortfall so the stamp duty can be paid in full.

To keep it vague, stamp duty is around £40k. Is the solicitor then able to complete without the full stamp duty as it isn’t due until 14 days after completion? I’ve read online that even if the shortfall is for stamp duty, it is still best practice to send a completion statement before completion?

1122abc

silvercar said:

If the broker applied for the wrong amount, they should hold some liability. What is the broker’s view?

it could well be that the solicitor was slow in getting you the completion statement and they should hold some responsibility for that. It may well be that they used money earmarked for the stamp duty to cover this in the short term.

They have said it’s simply a lender error due to a system issue and we should have seen the incorrect amount ourselves or our solicitor should have informed us 

1122abc

ExEstateAgent said:

Surely they solicitors couldn't complete without having confirmed payment in full had been made? Something amiss here! 

I think they were able to complete because the funds were there but the stamp duty wasn’t fully covered hence the shortfall 

user1977

1122abc said:

SDLT_Geek said:

mta999 said:

This is very unusual - obviously the solicitor has to wire the funds to the seller on completion and the seems to be a 20K shortfall so where did that 20k come from?

 I doubt it came from their client account.

I wonder how much the stamp duty is?  There is 14 days to pay this.  Perhaps the solicitor was able to complete with the money available and needs the £20K shortfall so the stamp duty can be paid in full.

Is the solicitor then able to complete without the full stamp duty as it isn’t due until 14 days after completion?

In theory yes, but (assuming the solicitors are also acting for your mortgage lender) they have undertaken to the lender that they are able to settle the SDLT and register your title (and also their charge). Which means they'll have to pay the shortfall themselves if you don't come up with the money.

Albermarle

1122abc said:

user1977 said:

Sounds very odd, even if they had made a mistake I'd expect them to say they can't complete until they receive the extra £20k. If it was a much smaller shortfall then perhaps they'd cover it themselves

Yes, and if they’d said that then we would have not wanted to complete as we did not plan to deplete our entire savings and more on completion of the purchase. 

If a solicitor makes a mistake, I don’t know if they are duty bound to tell you. So perhaps the issue is being glossed over until I raise a concern 

It looks like to me they made a big mistake as the completion should never have gone ahead, and now they just hope that you will cough up the money and it will all be forgotten.

Myci85

I agree with a previous poster that to me it sounds like the broker also made an error, if they had agreed to apply for a different amount and didn't do so. 'A system error' sounds very much like them trying to shirk any responsibility and focus instead on that you and the solicitor should have noticed. People use a broker to save them sorting the mortgage themselves. 

Obviously you and the solicitor should have noticed, and yes a completion statement should have been given in advance of completion, but I feel the actual error here was made by your broker, so they would be the ones I would be expecting to take the brunt of any cost to rectify. 

silvercar

I think the broker made an error. Put in a complaint, assuming you win, they should then be liable for putting you back in the position you should have been in. So if an unsecured loan costs you more per month than the mortgage of a higher amount would have done, they should be liable for the difference.