Any Advice\Help - failure to complete purchase - Scotland

nikkiandmidgets

here is a brief summary:

I was going to proceed with a house purchase last year but backed out before missives were signed because my ex husband (Split with him in June\July last year) had stopped paying maintenance payments and told me he was relocating to Panama. Just before xmas I reinstated my offer as my husband told me he would reinstate payments.

My credit history was a bit tarnished due to the split with husband and him pulling the joint bank acct when I found out he was having an affair. I had no earnings because I had taken a year off maternity to have our first daughter and whad just had our second daughter a few days before. My financial advisor went to Birmingham Midshires because they had previously approved a mortgage but this had expired so we had to go through the hoops again. Anyway they asked for my proof of id before xmas - I sent it to them. Then in January a new mortgage person at BM started dealing with my application so they asked for payslips. Gave them ones I could find. Financial advisor then contacted me a week or so later saying they were looking for the one or two missing ones. In meantime seller was looking to tie me into a settlement date - I was busy at work so my solicitor suggested she phone my finanical advisor and see what date he thought we could settle by. He came back saying 22nd Feb should give them time to get everything settled. A day or two later my solicitor chased me up saying selling solicitor was pressuring us for commitment and that I really had to get tied into this deal. I presumed because Aileen and Graeme had talked and she had told me 22nd was viable and cos BM had all my paperwork and they hadnt gotten back with any issues that it would all be okay so agreed to this over phone. Also had been given impression that mortgage had been all okay apart from some docs. Had been told I could get a mortgage of £135000 for the £150,000 property I was buying for £157,777.

I then handed my notice in with company I was contracting to at end of January cos I was unhappy there and felt being on the project I was on was stopping me getting chosen for other opportunities within the company. My new position was initial 2 month contract with another company with potential for longer or even permanent in future. Anyway 2 days after my financial advisor called me to say that BM were not happy with the quality of my payslips and had sent for an employers ref. We tried to get round this by getting missing payslips (2 weeks out of 3 months) sent from my employer but they decided they wanted the reference because they still were unhappy with the payslips. My payslips are stored online with old company and I received online print outs because I worked at a customers site. While waiting to get verified payslips etc I came clean to BM about job and they said they couldnt help me because my current contract was only for 2 months. I work in Aberdeen and with the Oil Industry and my experience I would have no problems finding a new contract if this ended.

Mortgage Advisor is looking around for another mortgage with a broker and says I may have to go self certified. He has done a few searches in the past also to see if he could find a better deal than BM were offering. I have also spoken to my employer and they say they are going to need me till at least July and will put this in writing. My finanical advisor had said to me that because I havent signed any missives or official docs that I could not be tied into this deal and that my solicitor really shouldnt have tied me into the deal until my mortgage was 100% approved. My solicitor says I have a concluded bargain and that I cannot back out without incurring huge costs - she says she has told seller I will not complete in time and that by law they have to give me another 14 days to conclude the deal. I should have concluded the purchase on friday 22nd.

My wage is £15 per hour for 37.5 hour week. I get £500 a month maintenance from my ex which he says he will maintain - this is less than the 20% he should pay - and family allowance of £1400 a year. I currently pay £1000 a month on rent so prove I can meet the repayment. Thing is I dont understand where mortgage advisor got the £135000 figure from unless he just went on 90% because this is quite a high multiple of my salary - unless he took maintenance into account? Has anyone any advice? Can anyone recommend a mortgage advisor or a mortgage company I can try? Mine says he is waiting for news from the broker he put my details too and that he is chasing her up daily. At the moment I am liable for interest at 5% above base rate on house price.

Thanks for any help - with split and husband messing me about in past and trying to persuade me to relocate to Panama I am not sure if this mess is all my fault or if my solicitor and financial advisor are partly to blame? But that doesnt really matter I guess as its me that will be out of pocket.

silvercar

A day or two later my solicitor chased me up saying selling solicitor was pressuring us for commitment and that I really had to get tied into this deal. I presumed because Aileen and Graeme had talked and she had told me 22nd was viable and cos BM had all my paperwork and they hadnt gotten back with any issues that it would all be okay so agreed to this over phone.

Second thread today where a solicitor has put clients in a difficult position!

I am not sure if this mess is all my fault or if my solicitor and financial advisor are partly to blame? But that doesnt really matter I guess as its me that will be out of pocket.

If a professional is to blame they have to pay the cost of putting it right. If your solicitor warned you that you were at risk if you exchanged without a formal mortgage offer they have covered themselves.

chappers

Indeed your solicitor should have warned you of the consequences of commiting before you had a formal mortgage offer.
On a purchase I made the vendor and their solicitor were pushing for us to exchange not only constantly phoning my solicitor but also me personally, my solicitor wouldn't even send me the draft contract until he had the formal offer in his hand.

nikkiandmidgets

Yes I think because she had given her word I would complete and was being hassled by other solicitor to tie me in thats why she was hassling me to commit. I stupidly thought that cos she had spoken to my mortgage advisor a few days before that when she phoned telling me I really need to get tied in and warned me of the consequences that when I explained I was waiting for final yes but that financial advisor had given me impression it was just a formality and that he had given her the date of 22nd for when it should all be finalised and money available that it was all systems go. I was in middle of doing a handover at work and apart from the warning she didnt recommend I shouldnt, she just asked if I was sure and I repeated what I said before. Then my financial advisor tells me not to panic that if I havent signed anything then I wasnt tied in so I thought it was all verbal - I didnt realise she could commit me to it without my signature or anything in writing, and thought mortgage lender would give me funds as I had been accepted last year with no paperwork and had been in same job.

Am hacked off. I am a single mum going through stress of a marriage breakup with two toddlers, a full time job, and am currently in expensive rented accommodation because I needed somewhere fast and it was available quickly, my husband is messing me about financially cos he hopes I will go back with him and relocate to Panama. He even suggested I just up sticks and go and leave all this mess behind. Its almost tempting at the moment the way I feel!

silvercar

I didnt realise she could commit me to it without my signature or anything in writing,

I don't think she can. Tell her you are not happy and want a copy of any document you signed agreeing to exchange!

nikkiandmidgets

silvercar wrote: »

I don't think she can. Tell her you are not happy and want a copy of any document you signed agreeing to exchange!

She says because I agreed over the phone she conluded the deal and tied me in. She is trying her best to limit my losses and says the sooner I can get feedback from the financial advisor as to whether I canget another mortgage and go ahead the better. As soon as I heard from my financial advisor that I had hit probs due to changing job when I thought my mortgage was sorted I emailed her and said I wasnt going ahead - approx 10-14 days ago, and she told me I couldnt, I was tied into the deal and it would cost me thousands. I mentioned to another solicitor and he says because I admit that I did say yes verbally that thats good enough but he did seem reluctant to help but maybe I should just be ruthless and ask for written proof and admit no liability? I keep hoping I can organise a mortgage deal - have told my financial advisor I could perhaps borrow from family to make it an 80% mortgage, and he said he was going to investigate self certification but I guess all this will take time and go past the 14 days so the seller might back out anyway and sue me.

ThriftyBeanie

The solicitor has broken no rules, she has acted upon client's verbal instruction. It might sound like the solicitor is being pushy, but you have to understand the local market and the house buying process in Scotland to form an accurate picture of what is happening here.

The local market in Aberdeen is still buoyant. Sellers tend to buy their next property before selling, because it is (generally speaking) easier to sell than to buy. Competition among buyers is strong. The solicitor is merely telling unlucky Nikki that if she can't commit to concluding the missive real soon there there is a strong danger that the seller is going to remarket the property (quite possibly there are other noted interests waiting in the wings) and there is a strong chance that the property will be lost to her.

The solicitor does not have to have written authority from the client to conclude the missive, verbal instruction is every bit as binding in Scots law.

The biggest mistake that I can see here is to jack in a job before the mortgage was approved, especially given that the hold up was caused by not providing sufficient proof of income.

Sorry Nikki, not what you want to hear, but this is the reality of your plight.

silvercar

Can't you sell the place on, as an assignment of contracts, so the new buyer buys in your place. I thought sales in Scotland were geared up to happen quickly so you would either need a bridging loan or pay compensation for late completion to the seller.

I think you need to make a decision, do you now want to buy or not. If you do then you need to see if a mortgage is possible and self-cert may be a way forward if you are a contractor. If you can't get a mortgage your decision is made for you.

silvercar

Cross posted with thrifty, who clearly knows more about the process in Scotland than me.

Just to say, you would not be out of pocket by tens of thousands if you failed to complete, as the seller would have a duty to mitigate losses so would offer the property for sale again You would be liable for any extra costs and reduced sale price.

nikkiandmidgets

Yes I know I was silly to change jobs but old contract was an ongoing week to week and technically could have ended at any time. I asked my financial advisor if there owuld be any issue in me changing jobs and he said no because we had given all the paperwork to BM and the last person delaing with it hadnt wanted to see payslips. They had my payslips for over a months O I didnt expect they would have issues with them and leave it that long to bring it to my attention, especially as I was supposed to be purchasing house in very near future - it was initially supposed to be 8th February but got put back when solicitor concluded the deal after she spoke to my financial advisor. Never was I told that he anticipated any problems with it, and I wasnt told not to change jobs when I asked. he told me he couldnt see it being a problem. Contract positions are the norm up in Aberdeen in the oil industry with some companies never taking people on as staff. The house I am buying is nearer to Dundee so wont command same sort of prices as up in Aberdeen. At moment I am liable for 5% interest over base rate, and I believe all sellers costs to resell, and interest on the total sum until he concludes a purchase, then the difference in price. I can see this costing me all the money I was initially putting in for a deposit and then some. I am happy to get another mortgage but my financial advisor has passed it to a broker and he asked me if my company would say they were potentially looking to take me on staff in future as they had told me at interview but the first letter just stated 2 months fixed contract. They are now drafting another one stating I am required till at least end of July after my solicitor told me most lenders look for 3 months plus but now he says till end of July isnt long enough but to scan and send the letter to him when I get it. As I have only been in newjob since 14th my company wont commit to any longer till I get settled in with their systems and they see what demand their will be then. I have asked around the agencies for a longer term job even though I like my current job but would take about a month to sort another one out what ith waiting for closing dates\interviews etc. If anyone can recommend anyone I can try or websites to point me in direction of then that would be great as I am loosing faith in my financial advisor.

ThriftyBeanie

Silvercar is right, you have to try to move on this as fast as poss. Push your FA to pull out all the stops on this one. Maybe self cert is the way to go.

Does your lawyer have a tie in with any FAs? Get her to enlist someone to try to sort the deal out. If as you say you can borrow some cash from family, it may make the mortgage easier to underwrite if the LTV comes down. You could always remortgage in a year or so to get their money back.

Main thing you have to do is keep the pressure on both lawyer and FA. Time is money.

In parallel see if there is any opportunity for quick resale. If you can find a quick buyer then you should be able to obtain closed bridging. Still hurts but got to find ways to limit the cost.

I really hope things work out for you soon.