How the heck can this happen? Mortgage funds sent but no contract signed.

[AnotherExpatKiwi]

DS and his partner have been attempting to buy a property for… forever! Were told last week it was going ahead for exchange/completion today, however last minute hitch with compliance for fire report meant not going ahead.

BUT

Yesterday were told that funds have been forwarded to the solicitors and then today had a message from the bank to say “congratulations on your completion, we’ll let you know the repayment schedule”.

They haven’t signed the contract nor paid the deposit! How can this happen? What can they do to ensure they’re not charged interest on a property they don’t even own?

The solicitor is as useless as a chocolate teapot, doesn’t reply to emails, or calls. Most of their information comes via the estate agent who is equally as frustrated with the process. Do they have any redress against a shit show of a service from the solicitors apart from complaining to the law society?

I honestly can’t believe the funds have been forwarded without contracts signed.

I would start with a complaint to the Solicitors and take it from there

I would also talk to the lender as they should be very concerned that there funds have been misused

So where is the actual money, as of cob today? Does DS have proof of that?

I would be turning up at the solicitors office

Tell the bank immediately has not been completed/signed for yet. Otherwise you will have to pay. You have no idea where the money actually is atm.

March down to the solicitor's office and bang loudly on the door.

Don’t fret. If a simultaneous exchange and completion was intended then the solicitor would have drawn down the mortgage money in readiness. That triggers the automatic congratulations message from the lender that your son would have received. However given exchange and completion have been delayed the solicitor will return the mortgage money to the lender. No interest is charged provided the money is returned promptly. It can be drawn down again when a new completion date is is set.

Tbh I'd assume thats just an automatic message from the lender, not that the money has been transferred from solicitor to solicitor. Its most likely sat in DS's solicitors account as it should be.

The mortgage funds have to be drawn down early to ensure they are available for completion - if this time last week they were expecting completion to happen today then yes the solicitor will have requested the draw down because it can take up to 5 days to be available. I think interest will be payable from the date of drawdown, I seem to remember my solicitor warning me of that when we first planned to do simultaneous exchange and completion

The solicitor has to send a COT to the lender in readiness, as completion hasn’t happened solicitor will return the funds as they can’t hold them. When they come to exchange & complete they will submit the COT again.

No help for your poor son but for others I would never recommend exchange and completion on the same day and never complete on a Friday. I’m sure it will all be sorted next week.

The solicitors have to request the money in advance. However, when I was conveyancing, if the money was not being used for completion more or less immediately ( with 24 hours I think) it had to be returned to the lender. Interest is charged from the day it is released. So if it is sitting in the solicitors's account a) it shouldn't be and b) interest will be charged.
However, you are very unlikely to be able to speak to the the solicitor or the lender over the weekend, and therefore you won't know what has happened until Monday.
Meanwhile, I totally agree with Thistooshallpsss: not only is it a terrible idea to exchange and complete on the same day, especially a Friday, I particularly wouldn't do it on the Friday before a Bank holiday.

Thanks for the info.

Hopefully things will be resolved next week. It’s taken them almost 10 months since putting the offer in to still not actually complete! Originally it was supposed to go through in February but there’s been delay after delay. Property purchase in England is a nightmare.

Are you SURE they haven’t signed? We signed our contracts weeks before exchange and sent them back to the solicitor undated so they were ready for exchange. It seems odd not to have signed them and returned them when planning to exchange and complete and only calling it off at the last minute.

Your broader point is right though - if they haven’t actually exchanged then the documents shouldn’t be dated and effective!

Sometimes the lender sends the money quicker than their instructions say they do. However, the solicitor should not have requested the funds until they have a signed contract and mortgage deed.