Stuck on two enquiries

[JadeTurtle]

Hi,

We're currently experiencing the joys of buying a house (our second time). The enquiries process has taken months as per usual, but they seem to be really stuck on two particular enquiries.

I believe our sellers bought the house on a Help To Buy mortgage through shared ownership so there's a question that keeps coming about tracing the landlord and they don't know who it is.

Apparently we are to enter into a 'deed of covenant' when we buy and they want an overview of what this entails, and confirmation of any fees. We haven't been told about any service/maintenance charges, although it is on a new-ish estate (around 8-9 years old).

They also want some information from the council - apparently in the transfer document from when they bought it, it says they 'must not dispose of the property without first ensuring that the council is made a party to the transfer' - does this mean they can't sell without the council's permission?! It isn't a council house or ex-council house.

The seller says he doesn't understand what either of these two enquiries mean, his solicitor is stalling and hasn't been able to find an answer since October. My question is, where do we go from here? Is there anything we can do/anyone else we can chase to assist?

Apparently it's not the type of outstanding enquiry that they can just issue an indemnity policy for and be done with it. We are getting close to losing our mortgage offer if this drags on much longer, having originally been told that everyone was aiming to complete for early December.

Confused and losing the will to live, please help!

Thanks!

Solicitors should be sorting this! I honestly don’t understand how some solicitors get away with being so crap. Blows my mind!

This is not your job to understand this stuff op that's what your paying a solicitor for, don't let it drive you mad

I think we've reached the point of desperation where anything we can do to speed this process along, we're willing! We've already had to bypass the solicitors for a couple of things and go through the estate agent instead because we couldn't bear to wait weeks for a response from the seller's solicitor (which seems to be their average turnaround time atm). But I guess with this issue it's not really something we can help with😣

Is it leasehold or free hold?

Freehold. Built in 2016 and the current sellers have owned it from new so you'd think the paperwork wouldn't be that hard to track down.

The Deeds should show any restrictions & parties with an interest?

Don't do this. Your solicitor is responsible for protecting you legally. Do not go round your own legal advisor!

In your shoes I'd be thinking about this one falling through if the other side won't answer basic enquiries.

It was only to see if they would facilitate (allow access) for an extra survey to be done that we had requested. We tried to go through the solicitor but after weeks of delay decided to ask the agent instead and they got it sorted in a matter of days. I don't want to go around them for anything legal.

At this point, even if we dropped out and found somewhere else quickly, our old mortgage will expire before it goes through (we were porting the old deal to get our ERC's refunded and our old rate) so might as well wait it out but if the mortgage expires then we'll have to see how much further we want to take it.

If only this whole process was as simple as it is in other places (e.g. Scotland!)

The seller appears to be extremely unaware of what they purchased.

A shared ownership property would have been purchased from a Registered Housing Provider or a Local Authority, they would have likely paid a mortage and rent initially or staircased to the full 100% purchase price which would have involved paying a lump sum to a Registered Provider or LA. Either way, some money would have had to change hands. However, most shared ownership properties are leasehold. This is a main drawback to buyers and an issue with SO properties as a whole.

My guess is that it is a Discount Market Sale property, The First Home Scheme wasn't around before 2021.
A DMS property would have a charge held by the LA and the seller would need permission from the LA to sell, any incoming purchasers would also need to be screened by the LA to ensure the eligibility criteria is being adhered to.

I would presume that the seller has wrongly presumed that the discount received was a builders discount, not a DMS discount, which is applicable in perpetuity.
All the applicable criteria and discount applied will be stated on the Land Registry TP1 document.

I wrote the policy for DMS for the LA I work for, but each LA sets its own criteria. You would be best looking on your LA website under their affordable housing section. The Gov.uk website also has a lot of useful information too.

A friend had a very similar situation and I advised them to do the following which worked, but you'd need to be in a position to follow through.

Email your solicitor and the estate agent, explaining that the lack of contact from the sellers solicitor is concerning you and for you to continue with the sale you require:

a) Confirmation from the solicitor within 48 hours that they are committing to tracing this paperwork and answering the query

b) Your solicitor will be kept up to date and the query resolved within 10 working days so that you can look to exchange contracts by x date

If a or b are not met unfortunately you will not be proceeding with the purchase, ask the agent to ensure the email is forwarded to the seller so that they can instruct their solicitor accordingly. October is completely taking the piss.

Just to add, regardless of what the other solicitor and the seller are doing, your own solicitor should be able to clearly explain what these issues actually mean to you. If the seller is saying they don't understand, then they need to be asking their solicitor to explain - it's not unusual to get weird legal questions that you don't understand and obviously you ask the solicitor! I think worth going to your estate agent to try and get from the seller their version of what's happening because it could be that they have a shit solicitor and they aren't aware of what's going on.

You wouldn't normally go through a solicitor to arrange a survey, that's usually done through an estate agent.
Put a rocket under your solicitor's rear end! And if what @hayal says is true, surely your solicitor would have found out when doing the normal land registry search?
I've had crap solicitors before - one when selling a property with a covenant on it (that I was unaware of when purchasing as wasn't applicable then) and he said he had come across it before. So a couple weeks pass and I asked had it been sorted and his response was 'oh I thought you were sorting it'! And he'd often come back with 'waiting for the other side to respond', when he presumably forgot that I had signed a form absolving from conflict of interest as the other solicitor WAS AT THE SAME FIRM, and literally across the hall. I was so young and naive then, now I wouldn't stand for such shoddy work.
Do as @Endogal says.

If the house was bought through the Help to Buy scheme, they usually lasted five years I believe. If it was built and purchased in 2016, there should be some information from the seller about what happened after the Help to Buy ended.

Many new builds have a management company, who are responsible for maintaining common parts, grounds maintenance and other aspects of the estate. I wonder if it’s the council in this case.

I lived on a new build estate where many sellers came up against this issue. We also sold a property where we used help to buy to purchase it initially. The help to buy we used was where we put a 5% deposit down and had a help to buy loan for 20% and then a mortgage for the other 75%. When we bought in 2015, you got 5 years interest free on the loan and then you started paying interest. The help to buy loan had to be repaid in full in 25 years. We needed a separate help to buy RICS survey and then had to contact help to buy with this and they gave permission for us to sell at the price we had accepted. Our solicitor then dealt with help to buy and when we completed they paid off the help to buy loan from our equity.

There was an issue on the estate though which a covenant in the deeds that essentially said if you don't pay your service charge that the management company can exert a possession order over your home. A lot of sellers came up against this as banks wouldn't accept this under the mortgage term and wouldn't accept indemnity insurance. If this is the issue you have you need a deed of variation from the management company that your lender agrees to accept. There were dozens of posts about this on the estate facebook page so if there is one for the estate it would be worth checking in there.

Also, if there is a management company for the estate then your solicitor should have asked for the management pack as this contains the info regarding the service charges and how much you'll be paying. This was done early on in our transaction.

I can't help with the shared ownership side though as ours was just help to buy and mortgage. I didn't realise you could use help to buy along with shared ownership.