Think our chain has collapsed...

[nolongeramug]

I have had the survey done on my purchase, solicitors are carrying out searches, then a phone call Saturday ruins everything.

The buyers at the start of the chain can not get a mortgage.

I'm in disbelief, there is only 4 of us in the chain, surely they sorted a bloody before allowing everyone else to go full steam ahead.

Also I remember specifically asking my EA is the chain proceedable, oh yes came the reply.

So what happens now? Do we all go back on the market? I will be immensely pissed off if I lose my purchase and wasted the survey fee..

Just want to scream and cry all at once

Huge sympathy - that is so frustrating.

I'm not sure about this but in my experience it is quite difficult to fully get a mortgage in place before you have chosen the house you want and know exactly how much you are going to be paying for it. We are currently buying and selling and our mortgage broker told us that he would not do a formal application until we had the exact figures because it is a black mark against your credit rating every time you apply and then need to do so again, or something. We have done the research to know how much we can borrow and we know that our credit rating is good, etc so have been as sure as we can be. Our broker also told us to tell EAs that we have an agreement in principle even when we don't and that that is standard practice. Not sure if he is just dodgy though . Fwiw, the agent we made an offer to made no mention of mortgages other than to try and sell us an appointment with their advisor - so didn't seem to expect that we would have one in place. I suppose it is slightly different when you are not a FTBer, though.

Anyway, none of that helps you. The chain may not totally break down though. Our buyer dropped out last week and we found another within days (well, we are formally accepting their offer today - hope they are still there!). We did have to lower the price to find another so quickly - maybe the first vendor in the chain could lower their price slightly and everyone higher up do the same so that you can all get moving and all share the cost?

Hope you get some good news soon.

Oh I really feel for you op, it's heartbreaking isn't it? Exactly the same has happened with us yesterday. The first time buyer at the bottom of the chain has pulled out. Spent all afternoon yesterday crying as it's taken us a year to get to this point. Our buyer is speaking with her financial advisor today to see if she can proceed without a buyer- am crossing everything, twice. If not there is a chance we could rent out our current property but that would mean all if our money we would use to extend will be swallowed up in buy to let mortgage deposit. In reality we'd probably have to go back on the market .
Here's hoping there's some light at the end of the tunnel for all of us.

The exact same thing happened to us last year - I still can't believe no-one checks that everyone has a mortgage offer in writing.

In my case everyone managed to hang on until bastard buyer got a mortgage, but it was a tense few months.

Hope you get some good news.

Chains collapse all the time for so many reasons; you just cannot assume it's all going ahead until the day you complete. It's all so stressful - all this 'mortgage agreed in principle' business is just not helpful. We have been told we can port our mortgage 'in principle' but we have an appointment with the bank today to get this nailed down in reality, and I totally expect them to say no, and come up with a dozen spurious reasons why not (it's a very good rate).

Sorry not helpful, but you have my sympathy. Good luck.

Same happened to me - our buyer had an agreement in principle but you can't get the actual agreement until you've had an offer accepted on the house, at which point they go through the credit check process. I was always under the impression that if you could support the claims (about deposit, salary etc) that you'd made to get the AIP (with payslips, bank statements etc) then it was just a formality, but it turns out that the bank can just not give it to you and change their mind almost at will. In this poor woman's case they just changed their mind on deposit required. She'd got an AIP for a 15% deposit and then when she came to do the paperwork they suddenly decided they wanted 20% which she wasn't able to find, or they'd charge a much higher APR then they'd previously said which she wouldn't be able to afford. As a first time buyer she was already at the limit of what she could afford. She was devastated, I was devastated. It's just rubbish, really, but one of those things...

Same thing happened to us last year. Stupid buyers had only phoned up the mortgage company to get an idea of what they could borrow and the estate agent took them at their word when they said they had a mortgage agreed in principle
Don't lose heart. Speak to your buyers, ours were happy to wait and we put a rocket up our estate agents arses and managed to sell within 2months.

So crap. Sorry to hear it.

Can you make the people above you move into rented? That way they don't lose their sale and they are chain free, attractive purchases for next time? I know it is hassle for them, but sell it to them. Your deal is with them not the people at the top of the chain. Is it a condition of sale that they sell when they buy?? If not, it's their problem (well you can try to make them see it like that?!!).

Just a thought. Good luck.

could also be issues with the house they tried to buy. maybe the agreement in principle was good but the survey showed something with the house that lowered the mortgage valuation too much.
we see that with a house in the neighborhood, where a roof beam is not up to required specification. 2 buyers had to pull out already because the banks will not lend the money without this being repaired (major ££££ job).

Op are you my buyer?
We found out this morning our chain has collapsed only 4 in chain, due to first person in the chain not being able to get a mortgage.

We have just paid £600 on a survey and we are gutted, my dd is even starting school in sept in the new area.

We are back on the market this pm .
Good luck with your sale!

Our chain has definately collapsed- no chance of anyone waiting for us or anyone performing magic with mortgages. Gutted. House will go back on the market and we will loose the house we loved . If anyone else says "it's not meant to be" "who knows what other house is out there" I will smack them! It took a year before a buyer was interested enough to put in an offer... ONE YEAR!!!! I was thinking we'd be in our new house in the autumn and getting excited to make it our own, now it's looking like we'll still be here at Christmas.

Everyone of us should be writing to our MPs to demand a change in conveyancing law.

In Queensland, once you commit, you commit (subject to a 10 day cooling off period, during which time you can get searches done).

Someone in the UK looked [shocked] and said 'What happens if the people you're buying from pull out? You'd be homeless..!'. No, because they, too, are committed to the sale going through on a given day. Ever larger fines are in place if anyone reneges.

Chains don't therefore exist, as such.

Simples.

But, erebus surely you can't commit until you have all the relevant info? Which is what searches, surveys, vendors questionnaires etc are about. Nobody would buy a house if they were legally bound before that, would they?

10 working days is all it should take. The English 'facilities' are, largely, taking the piss. That, surely, is the 'relevant' info. If every surveyor knew he had 'x', >10 days to perform the survey, you know what? He would. You can ask for more, of course, but every 'alteration' might incur a price adjustment. A clause saying 'I can't commit til I have a sale on my property' is fine- but they'd be committing to your asking price, no negotiation, wouldn't they? Or you might say 'I'll give you 3 months, get a sale, but if you don't, you're still committed to me'- so he might say 'OK, but you take your house off the market in the interim' etc etc OR you might say (contractually) 'Yes, but I'll keep advertising, and if I get a buyer, you will get 1st dibs but you have 3 days to commit to his price'. Loads of to and fro BUT your ESTATE AGENT (if you use one- I didn't on our last sale) does this, not you! Everything is initialled and counter initialled. And you never show anyone around your own house unless you want to! That's what you pay HIM for!

FWIW, I had the Searches ready to go on the house I sold myself. Structural; Land search; Title search (easy if its a Torrens title as just about every house built in Oz since 1950(?) is) and yer Termite inspection.

It really should not be as stressful and horrible as it is in England.

I advertised my house, conducted the viewings and sold it myself, 11 days after 1st advert, in 10 days in Oz (buyer waived his right to the 10 day cooling off- he was in a hurry!). We ended up rented the house off him for a week so our buyers in a '3 months sale or sooner if we sell sooner' contract! BUT we would have store dour stuff and taken a holiday unit for a week otherwise.

Sorry to hear of the chain collapses. It sucks. We went through this 18 months ago, then 6 months later. It's exhausting and depressing, especially when you know you've played straight and did everything you could.

Thank you all so much for your replies, still not had any good news, apparently they still can't get a mortgage but are still trying, whatever that means.
I think it's EA speak for we are keeping you hanging about.

gateacre1 - who knows I might be!

I have my heart set on this house, and although everyone means well in saying "it's obviously not meant to be". I too just want to smack em.

This house is a new start for me, buying it on my own, it will be just me and my DS, he is so excited too, I have not told him yet, and won't until I know it is for certain.

Just more waiting.

Just reading the replies again, can't believe so many of us in the same position, it really does suck.
I'm sick of having a headache from stress, stomach churning with worry, and I'm running low on wine to self medicate
This system is shit beyond belief.

The system is wrong. People we were buying from suddenly changed their minds, told EA they are not selling anymore and that's that, not to enter into any correspondence with them about it. In fact quite a nasty letter as if we'd been bugging them or something. We'd spent ££ on survey, solicitor etc. Not even a white lie as to why they changed their minds. End of story. Oh, I wished lots of bad things on them. (In new house now for 10 months, bigger, better, closer to schools etc.) Good luck. You'll be shell shocked for a while, it might still turn out OK.

Everyone should write to their MPs. IF this were a proper legal transaction, people ought to be 'in breach of contract' if they just decide, on a whim, to pull out of the sale with no penalties. It shouldn't be allowable.

The op's chain isn't collapsing because of a whim though. It's collapsing because the money is not available to the buyers. That is either because they've been unrealistic about their expectations or because they've been let down by the bank. The first is definately their fault, the second isn't. It's much harder to get a mortgage now than it used to be.

I think the point being made is that The System needs to change. IF the system demanded that people commit, the lending institutes would have to legally agree to the loan prior to anyone entering into a buying/selling commitment, wouldn't they?

Under the current system, people can withdraw on a whim.

We've just been that buyer ... The bank wouldn't let us apply for a mortgage till it was on a specific house at a specific price. And then they did their valuation, and valued it at a lot under what we were paying. So we challenged it (various factual things wrong in the valuation report) and that took the bank a couple more weeks of faffing, before they said no, the valuation was still the same. We need a high LTV so we can use all our savings on extending the house to make it big enough for us. The vendor refused to drop their price at all, and we can't buy if the bank won't lend us enough.

But there was no way of finding all that out in advance, it took 5 weeks to get that far. We had a "mortgage in principle" agreement that is totally not worth the paper it is written on - they did a credit check and said "ooh yes we would lend you £x,000s" - way more than we could afford to repay. They didn't look at dh's business accounts or anything before giving us the "agreement".

And the people we were buying from have put their house back on the market at the same price so some other poor bugger can go through the same as us .

well it seems there may be light at the end of our tunnel, our buyer is approaching someone who made a lower offer on her property to see if she still wants it! fingers crossed, if not who know what will happen.

good luck everyone !

That's good gateacre looks like there's some hope for you. The house we wanted is back on the market and if our buyer doesn't perform a miracle by the weekend then we will too.

Northern - if you meant my post where sellers pulled out in the Wednesday before exchanging contracts on Friday, then yes it's on a whim as far as I can see. Or perhaps they didn't get their mortgage or whatever. We don't know. Their sdolicitors were under no obligation to tell ours or the estate agents. So if appears then that it was on a whim and the system doesn't work well. It's £2000 going out of our pocket, not theirs. Plus DDs going to a school miles away for a year as it delayed school application etc.

House goes back on the market today

I have to break the news to my DS too.
This was more than a new house, im living with my ex, as neither of us can afford to buy each other out or rent.

Everyday is emotionally draining and I'm exhausted, so I thought I had the light at the end of the tunnel.

I literally pray that we get a new buyer and quickly.