Fallen through on completion day

[catpoooffender]

Absolutely devastated. We're in the middle of a three house chain. Today we are supposed to complete and our buyers lenders have decided to do some compliance checks that may take up to nine working days. Removals company have just finished packing up the van. Cats are at cattery. Post redirected. We paid for the packing service. I hired an additional van to clear some stuff. I can't believe this can happen.

We had a similar issue a few weeks ago. We had exchanged two weeks previously but our buyers' solicitor didn't get the funds from the bank in time. We moved all our stuff out and cleaned the house, only to be told that we wouldn't be closing that day. We had to stay with my sister for 8 days till they got it sorted. It was an utter nightmare, but thankfully it worked out.

Ah ok, thanks for explaining.

Kirsty Allsop was tweeting about this recently. Seems some solicitors have been pushing it that way because of covid. But seems crazy when you can build in a clause and actually things can happen to anyone at any time, Covid or not.

Im sorry op. I hope this gets sorted quickly for you

@Sexyfothermucker

This happened to us a few years ago. The whole thing broke down after we completed. Our van was packed and we were waiting to go. We got a call from the solicitors saying our buyer had had their mortgage offer withdrawn at the last minute. We lost everything. I hope this works out better for you.

How can it break down after completion? I'm confused...

I'm so sorry for you. We had a similar issue on a previous move when our buyers' mortgage offer was pulled.

We exchanged and completed on the same day this time - we moved into rented - due to COVID. We wanted more of a gap, but couldn't. It took a while for everything to chug through and our buyers only got the keys late afternoon.

UtterlyUnimaginativeUsername

"We had a similar issue a few weeks ago. We had exchanged two weeks previously but our buyers' solicitor didn't get the funds from the bank in time. We moved all our stuff out and cleaned the house, only to be told that we wouldn't be closing that day. We had to stay with my sister for 8 days till they got it sorted. It was an utter nightmare, but thankfully it worked out."

Staying in your sisters for a week and funds issuing a bit later is not remotely close to an entire sale falling through. It's insensitive to OP to suggest you had a similar issue.

We completed on Friday (exchanged about a month ago) we had a Covid clause which basically said anyone could pull out due to Covid, not ideal but I didn’t want to exchange and complete on the same day.
It was only us and our buyers in the chain and we have not bought anything, it still took till 5.30pm for the money to come through, things really are taking time with banks and lawyers working on reduced hours.
So sorry to hear this has happened to you OP, hope you get something sorted soon.

Thanks everyone for the comments. Having a surreal evening - feels like we have just moved into our own house, yet we can't fully unpack because we don't know what's going to happen...

Smallgoon his mortgage offer was pulled so the whole thing fell through after completion. Trust me. It can happen. It was a nightmare and I wouldnt wish it on anyone.

Nope, don’t understand how a mortgage offer can be pulled after completion.
Completion means the contacts have been completed successfully, monies transferred.
Do you mean exchange?

You poor things, how awful. We moved a few weeks back and solicitor was originally pushing for simultaneous exchange and completion. It petrified me for this very reason. We able to exchange 2 days before in the end and I was so grateful.

I’m so sorry you’re having to go through this. I really hope it works out for you.

I assume your purchase was also exchanging and completing on the same day too so you at least aren't liable for your seller's costs.

Simultaneous exchange and completion might have been the right advice in March but I can't see how it can be now. I'd be making a complaint to the solicitors - how fruitful this will be will probably depend on how they advised you of the risks.

@Sexyfothermucker

Smallgoon his mortgage offer was pulled so the whole thing fell through after completion. Trust me. It can happen. It was a nightmare and I wouldnt wish it on anyone.

As @Mildura has pointed out, how can it fall through after completion? Surely you mean exchange?

Really, really, feel for you OP, what horrendous situation.

Am I alone in thinking this whole simultaneous Exchange & Completion is totally crazy. What has happened to the previous situation where you Exchanged, so knew your Sale / Purchase was watertight and then arranged removals etc for a Completion day several weeks later.

I understand the Covid 19 issues, but are their any legal brains here that can explain why else we are moving towards shorter and shorter periods between Exchange and Compleion.

I found my last move stressful enough, but have no idea how I would cope with a van already loaded with furniture etc and then have everything fall through.

If this is a new thing I am not sure I could face moving again !!

@pastmybestbeforedate yes that's right.

The main party we feel is at fault here is the buyers lender. Given that you have to give five days notice to draw down the funds, it just seems insane to me that they said on Monday that they needed more documentation.

The whole process is ridiculous and this shouldn't be allowed to happen.

Ask the solicitor to get the owners to have it cleared before you exchange. Unless you have somewhere else to live it will be extremely difficult to move in otherwise.

Really sorry to hear this OP. I'm due to move in a few weeks and I'm sure I'd be inconsolable waking up in your position today.

My only thought is that exchanging two days or even two weeks ago would unlikely have prevented this. As you say, the buyer's lender raised queries at the 11th hour and didn't release funds which neither you nor your solicitor could have foreseen. Regardless of whether contracts had been exchanged, the buyer just wouldn't have been in a position to complete yesterday without funds which would have stopped you completing on your purchase (assuming you needed your sale to complete before you could go ahead). If contracts had been exchanged then you'd also now be in breach of contract for failing to complete your purchase with responsibility for your seller's costs beginning to accrue until completion finally occurs.

As a lawyer I just couldn't recommend to a client that they exchange on a contract where there's a risk they won't be able to perform, especially where performance relies on the actions of a third party (in this case your buyer and in the buyer's their bank).

I can only imagine that there's been some uncertainty or delay with the buyer's mortgage that they had hoped to resolve on time but which ultimately meant the buyer wasn't in a position to exchange until last minute. Not sure about Covid advice as I'm in Scotland and the conveyancing process is different.

I'm devastated for you. Can't imagine how you're feeling today.

Try not to think the worst though - from what you've said the buyer's lender hasn't pulled the mortgage, they're just asking for more info which will hopefully let them get comfortable and sign off on the mortgage, albeit late and to everyone else's inconvenience. Everyone has invested considerable time and money getting to this point so hopefully everyone is committed enough to wait this one out and you'll have good news shortly. Fingers crossed for you 🤞

I work for a law firm and as far as I know we absolutely arent recommending same day exchange and completion but building in a covid claus which accepts delays if there is a positive covid test which mean isolation is necessary.

Well, in a very surprising turn of events, it seems that our buyers mortgage has now been approved. So we're being asked for new exchange/completion dates. We've decided to propose exchanging in advance on the sale, but doing simultaneous exchange and completion on our purchase. We understand that this puts us at risk of having to move out of our house and having the purchase fall through but for various reasons we feel there is much less risk on the purchase side provided that the sale goes through.

@catpoooffender Great news - what a rollercoaster for you!!

Ah that's great news for you. Fingers crossed it all goes through x

I am SO pleased to hear this OP, hope it all goes through without a hitch and this will become a distant memory!

Hope it works out for you this time, OP.

In case anyone is still interested, we have now exchanged on the chain, and are due to complete early next week. Obviously relieved.

However I'm still obviously a bit worried that it could fall through, and I have some questions because I'm getting confused about what would happen in that scenario.

Let's say for arguments sake that we're selling for £300K and buying for £350K. Our buyers solicitor will have paid £30K to our solicitor on exchange, and presumably our solicitor has paid that on to our sellers solicitor. I understand that in the event that something went wrong again with the buyer, we could serve notice to complete within 10 days, and then if they don't complete we get to 'keep' that 10%. Except that we would in theory then owe our sellers 10% of their property, so would have to make up the additional £5K so that they get £35K. We all then walk away, with the seller having lost £30K (plus other costs), us having lost £5K (plus costs) and our sellers having gained £35K minus costs. Is that right? It doesn't seem so to me, because if that is the case, I'm not sure that exchanging has helped us much?

Sorry for my ignorance....