Risk breaching completion to satisfy my --bastard-- buyer?

[evilpopstar]

I'm due to move house next week. My buyer wants to keep his London flat and buy my house so has to complete by 31 March to avoid £27000 stamp duty on a second home. We have moved heaven and earth to comply but Due to numerous hold ups and his timeline we are being asked to take the risk of exchanging and completing on same day - which will be a heavy banking day due to all these pre 1st April sales going through at last minute - which could leave us ( not him as his purchase will go through first ) having exchanged but not completed. We could then move into the empty place we are buying on vendors say so but we are formally in breach of completion and charged £200 a day until sorted , most likely the next day. I think our buyer should pay us full removal
Costs and even then am wondering if we should take this risk. I have no timeline and it suits me to move in a couple of weeks when the moving frenzy had died down. I like where we are moving to but I don't love it. Am frozen with indecision. Help.

[evilpopstar]

Sorry was trying to do fancy delete thing in bastard - and failed!

[CityDweller]

I'm confused why exchanging and completing on same day will put you in breach of completion? I've exchanged and completed on the same day before and it was no issue at all.

If you're worried about the busy banking day, why not exchange before 31st and complete on 31st?

[evilpopstar]

Can't exchange before as we had to change our mortgage offer so money not ready til 30th and no guarantee then. Solicitor had said have to exchange and complete on same day as too risky that things won't be ready . We didn't want to. Risk is we exchange but money doesn't go through so if not through by 5pm bank closes we are in breach. All because of our stupid buyers tax evasion deadline.

[CityDweller]

Well, if you're not happy with the risk then don't do it. What do you think the likelihood is of your buyer pulling out if you insist on a later completion date? Or lowering his offer to make up for his additional tax bill?

[MrsSteptoe]

It's tax avoidance, not tax evasion.

Presumably the problem is that it will be a particularly meltdown bank day precisely because of the SDLT changes.

Can you suggest to your solicitor that he/she hold some money from your buyer (or his solicitor does) as an expression of good faith to show that he'll meet your costs if you end up getting slammed with breach charges? Given that he stands to save £27,000 in SDLT, a couple of thousand to sort out the problem is a bargain. Does that sound feasible?

[MrsSteptoe]

On another thread, a conveyancing assistant did say that there are deals falling through like ninepins when it becomes clear that they won't go through in time to avoid the extra stamp duty. So you might want to think about whether your buyer is likely to ditch the whole deal if it can't go through in time.

I wouldn't change the purchase price / sale price if you can avoid it, because it means reapplying for the mortgage. Our buyers gave us £5000 off the purchase price for a different reason, and we had to go through teh whole mortgage application process again.

[evilpopstar]

I've asked. They haven't got back. He's on a bloody foreign holiday in the sun. He's a tight arse who has avoided paying anything additional right down the line. I have found one removal firm who can move me on 31st if I book by 5pm today . I'll lose £900 deposit if o don't move. I've asked him to pay it. Silence.

[DelphiniumBlue]

You are quite right in your assessment of the risks.
Seeing as your buyer saves 27k by you compromising, it wouldn't kill them to compensate you for additional costs incurred by you as a consequence of completing on 31 march.
I would suggest a clause whereby a specified sum - say 5k- is put into a stakeholder account, so that the funds are there to compensate you for proveable loss- late completion penalties, hotel fees, whatever you can agree.
Also make completion time as early as possible on the sale.
I would expect all the funds to be with your solicitor before they exchange, and that needs to be as early in the day as possible - like 10 am.
Why can't buyer exchange earlier, even the day before?
It sounds like he's not sure he'll get his own funds in time. What happens if he is not ready to exchange and complete till say 3 pm? You would not be able to complete on your purchase, would you have storage arrangements in hand? What would be your arrangements with the removal people - would they be preparedd to hang on all day only for the job to be called off at the last minute?
You might prefer to arrange to complete on your purchase a few days later and book yourself onto a hotel in order to avoid stress.
And I can't imagine the vendors will let you in to their house before completion without some pretty hefty guarantees being in place. And who will be paying for the extra legal fees all this will u ndoubtedly incur?
Sorry not to sound more positive.
And is the bottom line that he will pull out if you don't agree?

[ShatnersBassoon]

To be fair to your buyer, they're avoiding tax, not evading it, and are doing what anyone would do in that position.

Why has the mortgage company said it will take so long to release funds? Presumably the bank holidays don't help, but when were the mortgage arrangements changed?

[evilpopstar]

No def won't change sale price. Too late. He says he will still buy the house after 31st but his mortgage runs out and he needs to get a new type of product as eventually he will have to sell his flat ( diddums - wish I had buy to let AND house in London aged thirty fecking one!). But it's London, prices have gone up since I accepted his offer , he's getting a great deal. My house sold in 2 days! ( think estAte agent under priced it).

[snowspider]

you could try and exchange with him prior with completionon or before 31 March and ask him to arrange permission for you to continue to occupy until a later date when you can exchange and then complete on your onward purchase

we have just done this - completed yesterday on our sale but we have postponed moving out for 8 weeks as we have not decided where to move next

our buyer also wanted to avoid the stamp duty so our whole offer to completion was achieved in 3 weeks

we have a licence to occupy, so our mortgage has been redeemed and we have the cash in the bank but no forced move and we are not paying rent

[evilpopstar]

Mortgage arrangements changed when I git lower price on house I'm buying after structural survey two weeks ago. We were originally going to buy a different house , it fell through , we found one with tenants. They left last week. It's empty. Hence late mortgage reoffer.

[ThroughThickAndThin01]

Presumably you knew about his timeline when you accepted his offer. I'm not quite sure why things have changed for you. You seem to be convinced you wouldnt complete on 31st, but it's very unlikely you won't.

And you say he's getting a great deal, but the market has been incredibly bouyant becsuse of this new rule. It's not quite so frothy now.

[evilpopstar]

snow our vendor won't delay much - has kicked out tenants for quick completion ( not a family , young pros who've found somewhere else thank god) . Just heard from agent he won't pay any moving costs. Wanker.

[evilpopstar]

through we did indeed know his timescale we should have stopped the whole thing when we lost the first house. Our fault in that sense. But now in ridiculous position.

[evilpopstar]

.... Of having to take on whole risk to get him his deal. Wish I had balls to say no get lost we are doing it after the 31st.

[ThroughThickAndThin01]

But I don't understand why you want him to pay your moving costs? It's normal for the buyer to pay their own moving costs. What am I missing?

[ShatnersBassoon]

Why should he pay your removals?

[MrsSteptoe]

Mmm, I didn't quite get that. I thought it would be more appropriate for the solicitor to hold money as an assurance that the OP would be reimbursed if she copped for completion breach fines (not that I know whether solicitors would recommend such a thing, it was an idea off the top of my head)

[CityDweller]

Evil it sounds to me like you really want to tell him that you're only willing to complete after 31st. Maybe you should. What's the worst that happens? He pulls out... You lose some solicitor fees, etc. Sounds like your'e not convinced on the property your'e buying anyway. Don't be forced into a move your'e not happy with because your buying is putting on the pressure. Take a step back, and a deep breath and then start calling the shots.

[ThroughThickAndThin01]

Yes I agree with City. To me you are sounding a little, not sure, bitter?

I'd just say don't expect to sell so quickly again. There are less buyers around. And more properties. You may be lucky twice, but may not.

[snowspider]

do you even lose solicitor costs if you pull out? are you on no completion no fee?

if you are not that keen on your new property then maybe that would be best..

[DarkBlueEyes]

We have just done a transaction in three weeks OMFG in order for the buyers to avoid the additional stamp duty payable after 1 April. They asked if they could exchange and complete on the same day but I got really twitchy about it for the reasons the OP has. Our situation was a bit different though as the house was 90% empty, but I still had to arrange removals etc and insisted we exchanged before I booked the removals, which they agreed to. We exchanged last Friday, I moved the last stuff and cleaned the house etc on Monday. Phoned the EA and said as house is clear, they could bring the previously agreed completion date of 29 March forward by agreement, and the lawyer emailed me at 5pm Tuesday to ask if we could complete Wednesday, which we did after the EA agreed to read the meters too fecking right their commission was enormous.

Having been in your shoes I would probably agree to do it in principle, but on the condition that the solicitor holds £20k (for example or the equivalent of the 10% exchange deposit) prior to exchange day, which you get to keep if you don't complete on the day. you can forget about asking for removal costs to be paid, this isn't appropriate IMHO. In any case, if they exchange on the day but don't complete, you get to keep the deposit, right? So do insist on 10% (our buyers solicitor - not the buyers themselves - tried to get away with 5%. Pah! NFW!

That way, you can have the confidence to exchange knowing the money is there.

[museumum]

You can get insurance from your removal company for delay. It' was only about £50 I think.
And £200 isn't much in the grand scheme of things if you're delayed a day (can't see why it would be more than one day).

[BaronessEllaSaturday]

Op can I just check which link in the chain you are concerned about not completing that day, is it the house you are moving to? If that is the case then that really is nothing to do with your buyer, there is no way he should have to compensate you for an upchain delay.