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Original poster

What would happen if we exchanged but couldn't complete?

87 replies

Helpplease181 · 17/10/2020 13:01

Due to complete very shortly on our house, we have the full deposit available which will be paid on exchange of contracts.

We won't complete until April/May as the properly isn't built yet. My worry is that at the moment we are tied into a big abroad wedding in May that we are not yet within our rights to cancel (Covid..) We booked it well over a year ago, and although we'd like to postpone a year we have other people's money wrapped up in it, so if/until the company cancel we have to assume it's going ahead. We have cut it to the absolute bone and got rid of all extras.

If we complete in April, then we will be fine for the wedding in May as we're currently estimating we'll be around £3k short at the maximum which we can put on a credit card and pay off with DHs November bonus.

My worry is if there are any delays (they haven't started building our house yet) that we may end up having to pay for the wedding before we complete. This means putting £3k on a credit card before our mortgage funds are released, which could in turn affect our affordability and lead to the lender pulling out.

If this happened, what would happen? Would we lose our deposit, and the house? Would they give us a couple of months to pay off the credit card? I'm beginning to panic that maybe we shouldn't exchange, but we so desperately want this house.

OP posts:

ChateauMargaux · 17/10/2020 20:38

I'm not convinced about the debt potential discussion... we had limits of 25k on credit cards that were never used.. no way if that was added to our actual debts would we have been able to get a mortgage.

Sit down with your parents and talk it through... ask them for advice. Ask them if they could find the extra 3k for two months, if the stars don't align.

Terrace58 · 17/10/2020 20:44

You have 6 months to find 3k and there are two of you. Could you not take part-time evening and weekend work in addition to your regular jobs? I know every area is different, but stores near me are hiring on the spot for people willing to work retail and demand is only going to go up as we hit the holidays.

Original poster

Helpplease181 · 17/10/2020 21:43

Yes house is well within our affordability. We're currently saving £1250 a month on top of our rent and outgoings, our mortgage is less than our rent and we won't have the wedding to save for at that point. Long term we can easily afford the house. It's just the fact it's due to complete at possibly the exact same time as the wedding that we're tied in to that is worrying us as it takes away the safety net of a credit card. We will have to have a chat with family and see if we can fall back on someone. Looks like with all the restrictions tightening we may be able to save more than our £1250 a month as we won't be able to go anywhere!

OP posts:

Original poster

Helpplease181 · 17/10/2020 21:46

We work on each other's days off to avoid having to use childcare, taking on any extra day shifts would mean finding childcare and factoring costs in so probably wouldn't make that much. I'm more than happy to take an evening job but retail are struggling and no bars or restaurants are taking on here, I have looked. No supermarkets advertising but I can ask in store. I've tried doing surveys on those apps and have spent nearly 6 hours in one day to make £3. It was soul destroying!

OP posts:

pinkgreenblue · 17/10/2020 21:56

Argh OP you will really frustrate me if you pull out of the house without having asked anyone if they can lend you 3k for a couple of months in the worst case scenario. Surely your parents wouldn’t want you to lose the house if they’re paying the stamp duty for you?

Also, if your parents are giving you 5k for the wedding PLUS the stamp duty as a gift then they’re not short of a few bob. I imagine a temporary 3k loan would not be an issue for them.

NoSquirrels · 17/10/2020 23:00

I meant - is the house purchase at the top of what the bank will lend you as a mortgage?

If you’re borrowing the maximum you can, then a £3K debt will be a tipping point if they run the credit check again.

If you’re only borrowing e.g. 75% of what they’d potentially lend you, then a £3K debt is unlikely to get your offer declined.

You need to be realistic not panicked.

Original poster

Helpplease181 · 17/10/2020 23:11

@NoSquirrels

I meant - is the house purchase at the top of what the bank will lend you as a mortgage?

If you’re borrowing the maximum you can, then a £3K debt will be a tipping point if they run the credit check again.

If you’re only borrowing e.g. 75% of what they’d potentially lend you, then a £3K debt is unlikely to get your offer declined.

You need to be realistic not panicked.

We are borrowing 70% of the maximum amount stated on our mortgage in principle

OP posts:

Spickle · 18/10/2020 12:22

I am a parent and have a daughter getting married next year. I have already committed quite a lot of money towards the wedding in addition to my wedding gift but if I were to be asked to lend them another £3k to help with additional funds needed for the house purchase, I would gladly provide the funds without hesitation. Don't be afraid, just ask. It's not like you are expecting it to be a gift.

cloudchaos · 18/10/2020 15:37

Never bought a new build but is this normal that you have to exchange many months before the build even starts? That sounds a bigger risk to me. I can understand putting down a small deposit, but not exchanging contracts. Is this actually what you have to do ?

user1487194234 · 18/10/2020 15:45

It is standard for new builds
But is undoubtedly more risky at the moment
TBH buying a new build with H2B funding is risky in my view

GU24Mum · 18/10/2020 17:19

You could try asking if you can have a clause in the contract so that where the seller/developer has to give you X working days notice of completion, you could ask for a proviso that they can't make the completion date be between X and Y dates if that's a very small number of weeks after the target completion date. If the houses are selling like hot cakes, you won't get that approved but otherwise the developer might prefer to have a sale and know that it just either has to be on time or to wait a handful of weeks.

zaffa · 18/10/2020 19:33

@Helpplease181

Parents already gifting 5k towards wedding (father of the bride) and paying stamp duty as a wedding present. Would feel beyond cheeky asking for anything on top. Ideally need to find it ourselves.

Aren't you benefiting from the stamp duty holiday though? Have you factored that in?

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