Solicitors left us in limbo no house / no money

[Nomoneyohno]

Hi, I’m hoping someone can give me some advice. My solicitors sent me the initial pack of paperwork and in this it said if it’s a joint mortgage but we want it to go to a single bank account then both parties need to sign a form which we did. The house has been sold and completed and then after completion my solicitors have decided there’s an issue with transferring the equity to a single bank account. Does anyone know if this is just them being difficult or if there’s an actual law about this? But then why would there be a form in their pack with this exact scenario which we both signed? Right now we have no house and no money either. Thanks in advance

If you have acted fraudulently there may well be an issue under the proceeds of crime legislation.

This sounds v dodgy. You've committed mortgage fraud by making false claims on your application form.

I really don’t see why it can’t go to both accounts and then you sort it out.

What effect could it possibly have if all is above board.

[quote Nomoneyohno]**@HasaDigaEebowai* we would happily go into the office as they are allowed to have visits by appointment. @PomPomSugar* would you have a large sum of money transferred through your accounts unnecessarily that you had nothing to do with? What if that affected you in the future somehow? Some people don’t like getting involved in transactions and being responsible for large amounts of money. My family member won’t even trust buying anything online!! There’s nothing untoward it’s my money that I have paid off over the years, I can prove the money has solely come from my house, I’m just frustrated as when I have been looking this up there are things that can be done to satisfy my solicitors to transfer it to my account rather than them just saying no![/quote]
How can you say the money has nothing to do with your relative when they’ve applied for the mortgage with you?

Do you and your relative understand that to apply for a joint mortgage you’re both liable for it? Why have you done that and then say it has nothing to do with them and they’re just doing you a ‘favour’? That’s not how mortgages work...

[quote Nomoneyohno]@Mumski45 we don’t want it split into 2 individual accounts unless the law states they absolutely can’t pay it into a single account. The family member was on the mortgage name only. No payments or money was put in by them. They have called the solicitors and signed paperwork and been into the office to prove their ID and confirmed they agree to this but the solicitors still refuse. It seems strange to me when they issued paperwork for this exact scenario asking us to sign we agree to be paid into a single account[/quote]
You can’t be on a mortgage in ‘name only’ - what was the reason for applying for a joint mortgage if your relative won’t be paying it, is it so they’d lend you more money?

@HasaDigaEebowai

If you have acted fraudulently there may well be an issue under the proceeds of crime legislation.

Only on Mumsnet

No not only on mumsnet . I’m a solicitor and we have to consider this when holding funds/acting for a client

What exactly is the fraud ? The other person agreed to the mortgage and knew if the OP didn’t pay, then they would be legally responsible for it. The OP paid. It’s fraud because both parties didn’t pay 50/50 every month?

Is it because the other person claims benefits and they don’t want a large amount of money to pass through their account which would affect their benefits? I’m not judging, just wondering if that is the explanation.

And agree, only Mumsnet would come up with this shite.

Presumably this is an older relative. If a large amount of money goes through their account, and if they need care or the taxmsn looks into it, then the disappearance of this money could be seen as derivation of assets - but then so could giving away half a house that they have a mortgage on...

It's fraud if the op obtained the mortgage on the basis of somebody else's earnings and by claiming that would contributing to servicing the debt.

Deprivation

@Nekoness
You don’t understand how this is an issue?! You want to buy a house but can’t afford to get a mortgage so you get a family member to apply for the mortgage with you therefore the bank assesses 2 people buying that house not 1. 2 salaries and therefore would lend more. However you have no intention of the family member paying the mortgage back only you. They are simply on the mortgage to endeavour you to borrow a higher amount. THAT IS FRAUD!!!!!

.

I don’t get why people are screaming fraud?

As I read it op has sold their house and mortgage paid off, so any outstanding monies are waiting to be paid out. Which the solicitor is refusing to do as two separate parties were on the dees who do not share a bank account. Where is the fraud?
Our solicitor paid out happily to my Dh account when we did this. Not a joint account. I just signed to say I agreed. (Money went straight though DH account and onto the next house purchase as a deposit with another solicitor and a new mortgage.)
Original mortgage had to be paid off first by first solicitor before they would pay out to us/Dh.

It sounds like the solicitor might be right to raise a red flag here. If you want this to go away silently I would have had the money split to two accounts immediately

@Nekoness and @Grobagsforever not only on mumsnet. I suggest keeping out of legal questions on which you are clearly not qualified to advise. The money laundering rules are very strict and increasingly being enforced against solicitors, who can be struck of (i.e. not able to earn a living), be subject to an unlimited fine or be sent to jail.

OP, hopefully the lawyers can sort it out, but be prepared to wait a while. As PP said they won’t be hanging on to it for shits and giggles as we get sanctioned for that too, but you have in all likelihood done something which is a best a bit suspect. Sound like you weren’t in a chain, so hopefully not lost a purchase anyway.

On the face of it is isn't fraud to apply for a joint mortgage when only one person is going to make the repayments. Unmarried couples do this all the time. However both parties own the property and both parties are responsible for the liability if the repayments are not paid.

What is potential fraud is the relative not wanting to declare having an asset that has been sold as technically they owned the asset and now the cash and as previous pp have said that may trigger a tax liability, a benefits claim or care home liabilities. It would effectively be a gift to the OP and could be counted as a deprivation of assets.

Was this other person on the mortgage also registered as joint owner of the house? If they were then capital gains tax and deprivation of assets might become a factor. And also were they claiming benefits.

@HasaDigaEebowai

If you have acted fraudulently there may well be an issue under the proceeds of crime legislation.

🙄😊 Don’t be so silly. She put a parent on her mortgage application, she didn’t mastermind a heist.

It was kind of a heist actually - bank thinks the op can pay back x amount based on her earnings and y (higher) amount based on her plus relatives income. So they lend y but in fact relative has nothing to do with it so she got y amount at more risk to the bank and based on a lie. It's presumably worked out ok for the bank as she's now sold the house and there is money left over but that wasn't a given when she was doing the fraudulent borrowing. And the relative may have a tax liability because they owned half the house, whether they realised that or not. It's a big mess.

I don't really understand how people cannot see this is potentially fraud and are being openly dismissive and rude when posters are offering sound legal advice? Free legal advice at that!

Heists are not paper exercises. The relative did remain jointly liable for the debt throughout the term, so i would look at it more from the CGT angle. @Mumski45 has the best perspective on the matter.

Solicitors offer no financial advice and are under no obligation to deal with CGT. A simple general advice along the lines of 'could be liable for CGT make sure you take an accountants advice' would be sufficient to tick the box from their end. No reason to hold on to funds on that front unless there is other information the OP is withholding. As a pp said, there are strict rules for solicitors re holding funds in client account unnecessarily so there must be a reason. Well that, or they are just not a great firm or someone is off sick/high workload/slipped through the net.