Paying for searches for the new house but my buyer pulled out

dinerodinero · 13 January 2019 at 10:32AM

Hello,

I am a bit lost about this and very very upset. Our house came to the market with PurpleBricks on July, by August it was sold and came out of the market. We bought a property and started the legal paperwork with the conveyancer and we paid our initial payment over £300.
A day before the final procedures the buyer pulled out. On the Purplebricks website it said that the buyer had their mortgage approved and the rest was on track, so we lost the money that we paid the conveyancer.
Our house went back on the market in October and the same thing happened again, it was sold in November and last week the buyer pulled out for the same reason ( their mortgage was not giving them the full amount to buy our property ).
Is that acceptable? Purplebricks has got the policy of 10 months in the market selling or not we need to pay them the fee, well we have not been 10 months really because as we 'sold' twice, our property has not been on the selling website for more than 3 months. I am going to put a complaint but I am not sure if you can help me.

eddddy · 13 January 2019 at 10:53AM

I'm not really sure what basis you have for complaint.

I guess you chose their 'Pay Later' option. Their terms and conditions (which you agreed to) seem very clear:

PAYMENT TERMS – EXTREMELY IMPORTANT

PLEASE READ CAREFULLY:
If you choose to Pay Later you shall make payment in full of the Product Service Fee when any of the following occurs, whichever happens first:

- When the property sells and the legal process is complete or
- If you withdraw your instructions for us to market the property or
- If you choose not to use the Conveyancing Services or
- Ten months from the date you enter into the Service Agreement.

Link: https://www.purplebricks.co.uk/terms/service-agreement/#138

This may have been an example of where a good 'traditional' estate agent would have been a better choice.

When your buyers had problems with their mortgage valuations (and/or other problems), the agent would have stepped in and tried to negotiate a solution.

And if they couldn't negotiate a solution, you wouldn't have to pay them.

But that's easy to say in hindsight!

davidmcn · 13 January 2019 at 10:57AM

It's not clear to me what the £300 was for or who or what you're complaining about. You said the second buyer pulled out "for the same reason", but also that the first buyer had their mortgage arranged, which suggests they had pulled out for a different reason. Do you think Purplebricks have done something wrong? Or your conveyancers?

AdrianC · 13 January 2019 at 11:04AM

So you've lost two buyers because their lender's valuation has downvalued the property? There's a pattern developing there, isn't there?

You haven't sold the house, quote marks or no. You've accepted two offers, but the putative buyers have pulled out before buying it. If you had sold it, then you wouldn't be asking this question.

As for whether the time withdrawn from being marketed counts or not, you need to read the Ts & Cs of the contract you agreed to. But July won't be "ten months" until May - you've got another four months to go. Reduce the price to the point at which valuers won't downvalue it from the offers, and remarket it.

The big question, though, is why you've managed to find two offers so quickly, yet both valuers have downvalued it. Is it because of issues that the valuers found which the putative buyers had not noticed?

loveka · 13 January 2019 at 11:05AM

It is just had luck that this has happened twice.

It happened to us 3 times, all 3 it fell through the day before exchange.

We lost thousands.

dinerodinero · 13 January 2019 at 11:13AM

davidmcn wrote: »

It's not clear to me what the £300 was for or who or what you're complaining about. You said the second buyer pulled out "for the same reason", but also that the first buyer had their mortgage arranged, which suggests they had pulled out for a different reason. Do you think Purplebricks have done something wrong? Or your conveyancers?

I found very weird that both buyers agreed to buy my property, that both buyers state on the Purplebricks portal that their finances are ok and that they have got a mortgage approved, our state agent says to us that everything is fine. So we buy a property ourselves and pay for the searches to our conveyancer for the new property and then the buyers of our house pulled out.
I understand that people can change their opinions and ideas, and buying a house is a very important thing but when money has been paid already and now it is not going ahead I do not know if the buyers that pulled out should be paying me the searches that we paid because they lied saying that their mortgage was in place

AdrianC · 13 January 2019 at 11:18AM

"...got mortgage approved..." may well just be an AiP.

The lender is effectively saying "Yes, we're happy to lend you £X in theory"
What the lender then needs to see is that the property is adequate security for that loan - they don't want their loan secured against somewhere that leaves them with a poor chance of recovering their money in the event of repossession.

The key part of that is the valuation. The lender themselves never see the property, so they send a trusted professional round to give them his opinion. Two of those trusted professionals have now said yours is not worth the offer.

That is not a reflection on the borrower. It is a reflection on your property. The borrower's lender simply does not want to secure a mortgage of that size against that house.

dinerodinero · 13 January 2019 at 11:19AM

AdrianC wrote: »

So you've lost two buyers because their lender's valuation has downvalued the property? There's a pattern developing there, isn't there?

You haven't sold the house, quote marks or no. You've accepted two offers, but the putative buyers have pulled out before buying it. If you had sold it, then you wouldn't be asking this question.

As for whether the time withdrawn from being marketed counts or not, you need to read the Ts & Cs of the contract you agreed to. But July won't be "ten months" until May - you've got another four months to go. Reduce the price to the point at which valuers won't downvalue it from the offers, and remarket it.

The big question, though, is why you've managed to find two offers so quickly, yet both valuers have downvalued it. Is it because of issues that the valuers found which the putative buyers had not noticed?

Thank you for your feedback.

On both occasions my property has not been devalued, the first buyer said that the bought a house somewhere else and he had problems with the mortgage and the second buyer said the house was devalued for £15,000 but when looking at the report there is nothing wrong with our property, it is because they mortgage did not give them the money that they were asking for.

dinerodinero · 13 January 2019 at 11:21AM

loveka wrote: »

It is just had luck that this has happened twice.

It happened to us 3 times, all 3 it fell through the day before exchange.

We lost thousands.

Sorry to hear that.

I know, it is really annoying. I think the system is not wright I think that if you agree and then pull out last minute you need to pay for what the other people has paid already.

AdrianC · 13 January 2019 at 11:23AM

dinerodinero wrote: »

On both occasions my property has not been devalued, the first buyer said that the bought a house somewhere else and he had problems with the mortgage and the second buyer said the house was devalued for £15,000 but when looking at the report there is nothing wrong with our property, it is because they mortgage did not give them the money that they were asking for.

So the second one was definitely £15k devaluation... but the first might or might not have been devaluation...?

Either way, it's irrelevant as far as the relationship between you and the EA is concerned. Right up until the minute that contracts are exchanged, any putative buyer can pull out for whatever reason they like, with zero penalty.

And so can the seller.

eddddy · 13 January 2019 at 11:30AM

dinerodinero wrote: »

I understand that people can change their opinions and ideas, and buying a house is a very important thing but when money has been paid already and now it is not going ahead I do not know if the buyers that pulled out should be paying me the searches that we paid because they lied saying that their mortgage was in place

Again, a 'traditional' agent would have qualified the buyer (i.e. asked to see mortgage offers and bank statements), and 'progressed' the buyer.

i.e. Phoned them for updates, find out if there were any problems, make sure they were doing everything they needed to do, etc

So you might have found out about the problems much quicker, and lost less time.

I'm not sure that PB do this kind of stuff.

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Paying for searches for the new house but my buyer pulled out

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