Completion date for purchase and sale on different days - has anyone done this?

[SheWouldNever]

Waiting for my solicitor to get back to me with their recommendation on this, and google not giving me many answers, so thought I’d ask here.

We are buying and selling, exchange hopefully today if we can agree on a completion date. Problem is that our seller and buyer want different dates for completion, neither willing to budge, and we are stuck in the middle able to do any date.

Without running it past the rest of the chain, our buyers made a contract with their buyers that they would complete on their sale no later than 24th March. Meanwhile, due to mortgage reasons, our seller wants to complete in April, which we were told about weeks ago, before it was announced that our buyers had this earlier deadline and had already exchanged with their buyers without running it past the onward chain (I suspect our EAs probably told them it would be fine).

Obviously our buyers aren’t keen on April as they will need to find temporary a accommodation and storage. It is being suggested that we, the middle party in the chain, exchange with both sale and purchase today, complete our sale in line with our buyers deadline, move into our new property that day (which is vacant as it was a rental property) and complete on our new property in April in line with our seller’s completion requirements.

Just wondering if anyone has done similar, and if there are any particular risks to us doing it this way that might not have occurred to me? Obviously it’s a PITA doing it this way when all the inconvenience is on us, despite it being on our EA and possibly the buyer’s solicitor giving them poor advice to proceed with a contract with their buyer without consulting the rest of the chains requirements first, or being prepared that doing things this way might mean they’d have to think of a plan B for temporary accommodation. And I’m quite pissed off at our EAs management of this when we are paying them a decent amount in sales fees. But if there’s little risk to us than I suppose we could complete on different days?

[CallforHecate]

So just to be clear they want you to move into the house you’re buying a month before you complete on it? I’d be very unsure about doing that. If that house is a vacant rental then why can’t the seller complete in March and sit on the funds for a month before they complete on the property they are buying? That seems the most obvious thing to do.

[SheWouldNever]

@CallforHecate yes essentially. I think it would be more like 2 weeks than a month, though. I am not sure why he can’t just sit on the funds, but the EA has said he’s adamant about completion not being before April. Abs to be fair, the April thing was brought up weeks ago, way before we knew anything about our buyers breaking the chain, his request all along was that IF the SLDT deadline was extended, could we complete April instead of March.

[Mildura]

It seems in this scenario that the risk lies with your seller much more than it does with you, so would be a feasible compromise.

[SheWouldNever]

I don’t think the seller is buying an onward property either. He is just selling this rental property but I think doesn’t want to incur the fees of paying the mortgage off early (the mortgage ends at the end of March)

[milinhas]

We didn’t do that exactly but as FTBs were given the keys to our new house for a few weeks before completion to fix some stuff and decorate (it was empty obviously!). Our solicitors together drew up something we signed about us not being able to sue for costs of they didn’t complete and they could sue us for damage or something along those lines. It was fine!

[milinhas]

Alternatively I would be comfortable with making the buyers find 2 weeks of temporary accomodation tbf, this is all their issue really.

[Bells3032]

If its a case of mortgage fees can he not speak to his mortgage company. Some will wave the fee if its a case of a few weeks. It is worth the ask at least. If not then either you or your buyers are either gonna have to cough up the fees or move into rental

[NoSquirrels]

I don't think there's any risk to you in this scenario - the risk is to your seller, as you will already be resident in his vacant rental property, and could refuse to pay him and be squatters! But as you won't renege on your side it's fine if you all agree to it. The solicitors will probably not like it, though.

[titchy]

@SheWouldNever

I don’t think the seller is buying an onward property either. He is just selling this rental property but I think doesn’t want to incur the fees of paying the mortgage off early (the mortgage ends at the end of March)

That's understandable. Your seller is taking the risk. As long as your seller and solicitor are happy to draw up a two week rental - Air B and B style that should work.

[GU24Mum]

OP, the risk to you (which you may be prepared to take) is that you exchange bit your seller decides that the two week rental isn't a great idea after all and you're left finding something temporary.

Your buyers have created the problem so really it's for them to solve themselves.

[SheWouldNever]

@GU24Mum hmmm that would not be a great scenario. We’ve got 4 kids plus animals. If our solicitor says there’s no way we can get a guaranteed contract to rent until completion, I don’t think I want to have different completion dates - will have to put the responsibility back onto our buyers. EA won’t be pleased, but I think it’s them who have created this scenario and promised our buyers a timeframe that was not guaranteed to work.

[GingerFigs]

Is the person you're buying the property from wanting to complete in April due to it being the new tax year? I can't think what tax implications selling a private property would have but if he's trying to push it out of March could it be because he's maxed his tax allowances or something for 20/21??

[Insertfunnyname]

@GingerFigs I think OP said it was to avoid early repayment on the mortgage or something

[RainingBatsAndFrogs]

The risk involved is to your seller, not you.

I would be OK with it, if my solicitor advised that it was OK.

Why are your buyers so insistent on their deadline?

[GingerFigs]

@Insertfunnyname oh right sorry. Hate when people don't RTFT and now done it myself 🤦🏼‍♀️

[SheWouldNever]

@RainingBatsAndFrogs their buyer is a developer, buying in cash and wants to flip it, putting it back on the market for spring / summer. I think he basically said ‘I buy it by X date in March or no deal’, so our buyers exchanged and made a contract with him that they would complete by then.

@GingerFigs I thought it might be tax reasons too and wondered why 1st April was OK and he wasn’t asking for after the 6th, but no it’s to do with the mortgage. He’s obvs very money focused as 2 weeks ago he was pushing us all to exchange before March 3rd because he was worried about a capital gains tax increase being announced in the budget. He was also happy to complete pre end of March to allow us to make the stamp duty deadline (before it got extended), so really he does have room to manoeuvre, and I can see why the EAs and our buyer are getting frustrated (even though it’s our buyers with the most immoveable deadline that wasn’t run past the chain).

[RainingBatsAndFrogs]

The developer almost certainly wanted to completion to be in time for the SDLT deadline, with a contingency for delayed completion.

Have your buyers actually asked their buyer - or is your buyers saying 'no we made a contract, and that's that'?

[RainingBatsAndFrogs]

If the developer is adamant, I would be inclined to move into our new place before completion, with full advice form your solicitor.

A developer can walk away from a purchase without much penalty. They haven't paid out for a mortgage etc, may not even have paid for a survey or searches, so no skin off their nose.

[SeasonFinale]

So your buyers have already exchanged on their sale, it remains their problem. They can move in with family or a hotel for the short period of time.

[SheWouldNever]

@RainingBatsAndFrogs do a developer wouldn’t incur the same penalties after exchange? They’ve already exchanged on our buyers place so I had figured that purchase was a done deal.

[NoSquirrels]

Really, either the developer waits 2 weeks for completion or your seller exchanges early like he was prepared to do.

If it’s financial penalties he wants to avoid, he can ask your buyers to compensate him - and by the same score they could ask him for a contribution to their extra costs of removals etc.

Really the estate agents need to earn their fee by fixing this!

[SheWouldNever]

@NoSquirrels the seller is happy to all exchange on the same day, just not complete before April. I'm not sure our buyers would be able to afford to compensate him (and I'm not sure how much these financial penalties are that he's hoping to avoid - must be reasonable if he's not willing to budge on completion date) - the other day the buyers were asking us (via the EA) whether they could exchange with - 10k the exchange deposit needed as they didn't have the extra money to hand to make it up to 10% so I don't think they are particularly cash rich right now.

No word back from our solicitor today, probably because he doesn't have any answers for us yet, we usually hear from him pretty quickly once he does. So I guess we wait until next week to find out what our completion date will be / who's going to have to compromise.

[RainingBatsAndFrogs]

[quote SheWouldNever]@RainingBatsAndFrogs do a developer wouldn’t incur the same penalties after exchange? They’ve already exchanged on our buyers place so I had figured that purchase was a done deal.[/quote]
Oh, sorry, I hadn't clocked that your buyers had actually exchanged on the sale to the developer.

yes, the developer would incur the same penalties.

But actually it is your buyer who would incur penalties if they can't give vacant possession on the day named in the exchanged contracts as completion .

What is your concern about moving into your new place before you have completed on it? If you have exchanged?

[SheWouldNever]

@RainingBatsAndFrogs I don’t know if I have a concern as long as we have exchanged, I think I was just pondering about potential risks or things to think about if we do it that way. Solicitor will advise us but sometimes it can be painfully slow waiting to hear from them when it’s something you quite want answers to quickly!

[Gladly]

I can't really see why anyone thinks it is your problem to solve, or inconvenience to take - I'd be standing firm on both properties needing to complete on the same day, and your buyer will have to spend two weeks with family or in an air b&b - this is their mess not yours.

I very tentatively explored similar with a solicitor for a purchase a few years ago and their advice was absolutely not - but I think possibly that was the suggestion of moving prior to exchange which is obviously riskier. It was a few years ago now so I can't remember the details.