Buyer doesnt have deposit. Help!

[Moversnotshakers]

Hope someone can help as I need advice. We are at the exchange stage of house buying and sellingI have been told today that our 'first time buyer' doesn't have deposit funds as he is waiting on funds from the sale of his partners flat. House sale is in his name only and any flat she owns shouldn't come into it surely? Estate agent said they know nothing of another property to sell and are desperately trying to speak to his solicitor etc. Where do I stand? My vendor and us are all set to exchange and we thought our buyer was too, now it seems he lied. How did he get mortgage offer without proof of funds? I'm lost for words and totally gutted and can't sleep for worrying. This flat is allegedly four weeks away from completion so do I have to wait it out or can I insist he exchanges asap and has to' borrow' the deposit?

Put your property back on the market and see what happens. I think they are running a fiddle here to benefit from pretending to be FTB and this was their plan all along. I would also immediately switch to a new estate agent.

If this was a month into things I would pull out. However this is four months down the line ,we have out hearts set on our lovely new home and our vendors are so lovely and we still want to move . I don't want to pull out of the sale, however I don't want them to know that either and want them to panick and realise what they have done!!

I told.my vendors as I'm honest and straightforward and they were hoping to complete this week as was I. My sol and EA are desperately trying to get answers this morning but as of yet no word back from his solicitor. EA confirmed they don't ask about funds for deposit. ( They may well do going forward after this) I'm so stressed and fed up. I really don't want to wait another few months to get a new buyer and loose out on my lovely new home that was so nearly mine this week!!

I'm so sorry OP. This really is very unprofessional of the EA.
Every EA that I have ever known and dealt with has ALWAYS asked for proof of funds to be in a position to proceed. It is really very negligent of the agent to be in this position at this stage. Frankly I've never heard of this situation before.

As you can see yourself this is why it is so important as worthless without.

This has literally just happened to me! We were ready to exchange about 8 weeks ago then found this out. We stuck with our buyer and are still waiting now.

EA updated on reason why her flat isn't complete yet. However the point is no one has actually asked the buyer can he get the deposit elsewhere yet? Surely that should be the first thing to ask and not just to be held ransom to their stupidity!

EA normally ask for deposit proof + AIP before issuing memo of sale. Never heard of this not being done! They are incompetent! You will need to manage/control the narrative to get to your goal, please don't rely on these bunch of fools (EA and buyers both!)

How much is the deposit OP? I’m not sure many people can magic up thousands & thousands of pounds. And the very fact he needs his gf flat sale suggests he doesn’t have any other sources of deposit. Our deposit for example is £56,000 - 80% LTV. That’s basically two years salary for me. I don’t know a soul that could have ever lent us that much money!

Your buyer will likely be getting at minimum 85% LTV as that’s the minimum banks are offering - so bigger deposits required at the mo. 😣

Has the girlfriend exchanged on her flat?

We didn't have a 10% deposit on our second purchase. Our solicitor offered the deposit from our sale instead - which was about 5% and that was fine.

I'd be looking for them to put forward some sort of cash, even if it is just a few thousand so they have skin in the game. Without it, I'd be considering re-marketing. Good luck OP.

The buyers 'new found flat' has a freehold reversion on going, so it needs re signed and sent back to land registry before any exchange/completion can happen. Could be weeks or even months. I am so angry at EA for letting this happen and of course buyers for hiding this sale when we accepted them a FTB

OP

You mean the sale of the flat that will be the deposit is having a freehold issue?

What’s the time frame for that?

Crossing everything for you.

I would consider going back on the market op.

They have been quite dishonest about their ability to proceed and the timescales. It must be tempting to tell them to jeff off.

But if you can, I'd hold my nerve and tell them to get in touch when they are ready to exchange. Then remarket. It may focus their ability to find a deposit.

Oh dear. I would definitely remarket now. They are not in a position to progress. What a mess.

I was a FTB this year and had to send my bank statements to the EA as proof of funds. Unbelievable that your EA hasn't done that in 4 months. Shocking.

You mention 'my vendors and us' but if you are selling aren't you the vendor?

I am genuinely confused on who is who in this

Oh dear. What a nightmare, I feel for you.
We had our offer on a house accepted in May 2019. The vendor had already moved into an apartment and wanted a quick exchange and completion. Unfortunately, the vendor had raised an issue with The Land Registry (she had "acquired " approx 12 inches x 60 inches of garden from next door). Our buyer wanted us out. To keep our buyer we moved into temporary accomodation for 4 weeks. All our furniture was in storage and we lived out of a small suitcase. In that 4 weeks we moved 10 times! between friends, relatives, hotels and BnBs.
The Land Registry were very slow. They had been informed of the issue in June but did not contact the neighbour whose garden was affected until September. It took a further 2 months to resolve. We eventually exchanged and completed mid November.
You need a plan B here.
I am sorry to say this could be a lengthy process. It was a long drawn out process for us and that was without having to allow for Covid.
I would get you property back on the market ASAP.
Good Luck.
(Incidentally, The Land Registry issued a new plan for our property and boundary and it is still wrong ( in our favour)

I would tell the EA to put it back in the market and if a new proceed able buyer is not found within 2 weeks you are taking it off the market.

That will focus them swiftly on finding you a new buyer.

In my 3 sales I have had buyers drop out late in the process, abd the EA has always found a new buyer fast. Their minds are in saving the sale and their commission at that point.

Just to say. The Land Registry will have issued a reference number to this case ( the girlfriend's flat) I think it is the number the property has on the title plan at the Land Registry. They will speak to you to update you on their progress despite the fact that you do not own the property but it will be limited for that reason also. They might be at least able to give you some idea of a time frame in their experience of dealing with this issue. It will be a bit like pulling teeth but try to stay polite despite your frustration. It might at least give you some idea. Worth a try.
Hope this helps

Just to say also, if you know the address of the girlfriend's flat, you can buy the title plan online for £3 (for the Ref number)I bought the title plans for both our neighbours properties when we were buying our house.

Update!! We are held our nerve, and eventually 6 months from offer date. We complete on Friday 22 Jan. This involved holding my thoughts towards my buyers but keeping in regular contact with them, and keeping my vendors happy on the other side! Also dealing with a brand new job... Ah stress has been awful xx

Congratulations, make sure you spit in the bucket when you clean the kitchen floor on moving day ;)

This is what you're paying a solicitor for.

Instruct your solicitor to phone the buyer'solicitor and find out what the hell is going on.

Thank goodness! I really hope you can relax in your new home and put all this stress behind you. Roll on the 22nd!

Thanks, so relieved x