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Second Asking Price Offer Refused

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A couple of weeks ago, I put an asking price offer on a house then was outbid by £5K (refused to play in a bidding war so walked away).

Yesterday, I put an asking price offer on another house whilst still at the viewing and was told they were holding out for more (!!!). This one had been reduced by £25K after not getting any offers in a month.

In both cases, the ~55-60 yr old female owners had split up with their partners. Seller 1 was a bankrupt but had held out for 3 years. Seller 2 is self-employed, debts to clear, equity to split and then not enough equity/income to buy anything. The banks are not interested in initiating repossession proceedings, the cause of the first sale was simply the official receiver getting to the 3 year bankruptcy limit.

Both houses tick most/all the boxes with big plots, in the best location I'm aiming for and are better value than the house I sold in 2003. I'd need a tiny mortgage for the current one, around 0.7x income.

So even with the current state of the economy, those with the better houses and still holding out whilst going completely broke. I've realised that these people know the game is up but will just burn up every last penny to stay in the better houses then throw themselves on the state. If you are nearing retirement age, have some equity but not enough to buy, your benefits get slashed and equity burns up anyway. Going completely broke and hiding as much as possible is probably the best option.

I've said the offer will be held for a few days before being withdrawn, that's about the only pressure I can apply, it's in the EA's interest to push my generous-to-a-fault offer. The last thing I want is for my offer to be used as leverage to squeeze somebody else.

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A couple of weeks ago, I put an asking price offer on a house then was outbid by £5K (refused to play in a bidding war so walked away).

Yesterday, I put an asking price offer on another house whilst still at the viewing and was told they were holding out for more (!!!). This one had been reduced by £25K after not getting any offers in a month.

In both cases, the ~55-60 yr old female owners had split up with their partners. Seller 1 was a bankrupt but had held out for 3 years. Seller 2 is self-employed, debts to clear, equity to split and then not enough equity/income to buy anything. The banks are not interested in initiating repossession proceedings, the cause of the first sale was simply the official receiver getting to the 3 year bankruptcy limit.

Both houses tick most/all the boxes with big plots, in the best location I'm aiming for and are better value than the house I sold in 2003. I'd need a tiny mortgage for the current one, around 0.7x income.

So even with the current state of the economy, those with the better houses and still holding out whilst going completely broke. I've realised that these people know the game is up but will just burn up every last penny to stay in the better houses then throw themselves on the state. If you are nearing retirement age, have some equity but not enough to buy, your benefits get slashed and equity burns up anyway. Going completely broke and hiding as much as possible is probably the best option.

I've said the offer will be held for a few days before being withdrawn, that's about the only pressure I can apply, it's in the EA's interest to push my generous-to-a-fault offer. The last thing I want is for my offer to be used as leverage to squeeze somebody else.

What amazes me is that anyone buying a house doesnt realise that they will be "played" by estate agents.

What also amazes me is that anyone will ever pay the asking price for a house...especially in teh current ecponomic climate.

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A friend of parents is getting repossessed this weekend. They bought the house for around £80k in the 90s. MEWed to high heaven and mortgage is now £210k!! Can't keep up the payments so about 6 months in arrears before he gave up and stopped paying. The bank has finally go the hump and said you have 1 month to sell so they put on the Market. He needs £210k to cover the mortgage then another £10k to cover fees and on top he says he wants at least £10k out of it!! (on top of the £120k he's already had and wasted!) so puts it up for £240k. £210k maybe £220k would be more appropriate IMO. Anyway now viewings, no offers and no interest and the months up so he's out. The thing is now he knows he'll be left with debt after the sale as it will probably go cheap so he is going bankrupt getting his debts written off and renting for £1100pcm up the month!

This should not be allowed I'm IMO he should be forced to pay at least some back as he has a good income it. I can't afford to rent for 1100pcm!

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What amazes me is that anyone buying a house doesnt realise that they will be "played" by estate agents.

I did notice that there was a viewing booked half an hour after mine to put the pressure on. The owner said there had been no viewing for days before or booked after so this was simple manipulation. Half an hour is not enough to view so I just wait in the garden to be annoying then have another look around. You see a lot more faults next time.

I have all the previous sale history for the area which I know well. The asking price is £250/sqft, above my target of £200/sqft but there is more than enough room to extend to get below target. I can reduce the offer is my surveyor finds anything.

What also amazes me is that anyone will ever pay the asking price for a house...especially in teh current ecponomic climate.

I paid asking price for my first house in 1997, more than doubled in 4 years. I've made offers between 40% off asking and 22% above asking before.

My view of the current conditions is that house prices are still overpriced by at least 25% but there is a significant risk that :

- nominal prices drops will be much smaller, say 15%.

- the value of my cash is being transferred to the banks via low savings rates

- the value of my cash is going down due to inflation

- the crash could take 5-10 more years.

My kids are around primary school age and I am 40+. I have run out of time and my low-risk nature says just buy for cash (nearly) and sit it out if I can find a distressed seller in the right area. I'm not going to want to be working on a house/garden when I am 50+ and the kids start moving out. If there is a mega crash in the short-term then my income could allow me to do a big trade up.

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A friend of parents is getting repossessed this weekend. They bought the house for around £80k in the 90s. MEWed to high heaven and mortgage is now £210k!! Can't keep up the payments so about 6 months in arrears before he gave up and stopped paying. The bank has finally go the hump and said you have 1 month to sell so they put on the Market. He needs £210k to cover the mortgage then another £10k to cover fees and on top he says he wants at least £10k out of it!! (on top of the £120k he's already had and wasted!) so puts it up for £240k. £210k maybe £220k would be more appropriate IMO. Anyway now viewings, no offers and no interest and the months up so he's out. The thing is now he knows he'll be left with debt after the sale as it will probably go cheap so he is going bankrupt getting his debts written off and renting for £1100pcm up the month!

This should not be allowed I'm IMO he should be forced to pay at least some back as he has a good income [/size]it. I can't afford to rent for 1100pcm!

....... errr actually...........

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A friend of parents is getting repossessed this weekend. They bought the house for around £80k in the 90s. MEWed to high heaven and mortgage is now £210k!! Can't keep up the payments so about 6 months in arrears before he gave up and stopped paying. The bank has finally go the hump and said you have 1 month to sell so they put on the Market. He needs £210k to cover the mortgage then another £10k to cover fees and on top he says he wants at least £10k out of it!! (on top of the £120k he's already had and wasted!) so puts it up for £240k. £210k maybe £220k would be more appropriate IMO. Anyway now viewings, no offers and no interest and the months up so he's out. The thing is now he knows he'll be left with debt after the sale as it will probably go cheap so he is going bankrupt getting his debts written off and renting for £1100pcm up the month!

This should not be allowed I'm IMO he should be forced to pay at least some back as he has a good income it. I can't afford to rent for 1100pcm!

Worked with a guy who mewed the house away and sold just in time and just at the right price to clear the debt's . Otherwise he would have been on the same road.

He and his wife had good jobs, bonuses, share options , and big fat pay offs from the company. With earnings included they propbley went through about £100k a year over the last 15 years yes £1.5 million over the years , now left with his salary that just covers the rent and bills they live on what she earns. They have no money and nothing to show for all that money.

His brother mean while earnt what one of them earn't paid his mortgage off sold the house and banked about £300k, He now does not work and lives of the income form the invested money. He is now getting pressure from brother and wife plus her familly to sort them out. He kindly pointed out that they should be twice as well off as him as they had twice the amount of money that he had.

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Don't want to sell the 'nest' and give up proceeds to hubby who is living like Alan Partridge somewhere.

For the second house, hubby went to China.

The realisation for me in all this is that once you are going bust, you may as well go all the way and live in a nice house whilst you are waiting.

The system forces you to either be broke or rich, the inbetweeners get stuffed having to work for a living and pay their own way.

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The thing is now he knows he'll be left with debt after the sale as it will probably go cheap so he is going bankrupt getting his debts written off and renting for £1100pcm up the month!

Bankruptcy doesn't wipe out mortgage debt.

Mort - Death

Gage = Contract

Mortgage = Death Contract

Unless the bank gets generous and writes the debt off, you owe the money until you repay it or you die. To keep the debt "live" the banks merely have to *attempt* to contact you every 12 years.

Banks wrote some of the debts from the last crash off when houses started to boom again, as it allowed the debtors to borrow again and get in even more debt... but then, they were usually writing off a few thousand knowing the person would be taking a loan for a few TENS of thousands. I can't see that happening again this time, not when people owe tens or hundreds of thousands of pounds.

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Bankruptcy doesn't wipe out mortgage debt.

In the UK, bankruptcy wipes out mortgage debt.

You may be confusing this with the situation where the bank can repossess but does not make you bankrupt. In that case, they can chase you for years.

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Bankruptcy doesn't wipe out mortgage debt.

Mort - Death

Gage = Contract

Mortgage = Death Contract

Unless the bank gets generous and writes the debt off, you owe the money until you repay it or you die. To keep the debt "live" the banks merely have to *attempt* to contact you every 12 years.

Banks wrote some of the debts from the last crash off when houses started to boom again, as it allowed the debtors to borrow again and get in even more debt... but then, they were usually writing off a few thousand knowing the person would be taking a loan for a few TENS of thousands. I can't see that happening again this time, not when people owe tens or hundreds of thousands of pounds.

To be honest I've forgotten the numbers but in about 1990 someone I know, on the verge of repossession, threw the keys through the letter box of the building society and did a moonlight flit. They went into the black economy at the seaside for a good number of years - 8 or 9 I think. Then, they returned, the bloke having got his old job back. The minute he reappeared on the PAYE system, he got a letter from the Building Society chasing him for the outstanding money. Forget how much, 12k rings a bell.

Long story short, he ended up with an attachment of earnings order for £5 a month. He proved to the court's satisfaction that he virtually no disposable income. That every penny he earned was needed for rent, rates, food and utilities.

If he lived to be a thousand he won't pay it all back and, although when credit was easy it didn't give him any problems, now that credit is tight it seriously affects his credit rating.

The moral is - they don't necessarily write debts off.

A few years ago he went self - employed. They don't even get their £5 a month any more.

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For the second house, hubby went to China.

The realisation for me in all this is that once you are going bust, you may as well go all the way and live in a nice house whilst you are waiting.

The system forces you to either be broke or rich, the inbetweeners get stuffed having to work for a living and pay their own way.

Seems like the only way to be an "in betweener" (which describes me quite nicely) is to be apparently broke but actually have a sizable hidden stash of wealth somewhere. Think I'm going to start some low level wealth hiding myself - every time I go to the cash point, take out an extra 50 and stash it away somewhere.

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In the UK, bankruptcy wipes out mortgage debt.

You may be confusing this with the situation where the bank can repossess but does not make you bankrupt. In that case, they can chase you for years.

or maybe the sneaky "deed of acknowledgment" that banks get customers to sign after bankruptcy, that leaves them liable for the shortfall on the mortgage!

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Seems like the only way to be an "in betweener" (which describes me quite nicely) is to be apparently broke but actually have a sizable hidden stash of wealth somewhere. Think I'm going to start some low level wealth hiding myself - every time I go to the cash point, take out an extra 50 and stash it away somewhere.

In what form does this sizeable hidden stash exist?

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A couple of weeks ago, I put an asking price offer on a house then was outbid by £5K (refused to play in a bidding war so walked away).

Yesterday, I put an asking price offer on another house whilst still at the viewing and was told they were holding out for more (!!!). This one had been reduced by £25K after not getting any offers in a month.

Without meaning to be overly rude, I think you need to learn a bit about negotiating...

If you go straight in at asking price, you immediately make the vendor think that they've undervalued it. Start low, allow yourself to be negotiated up a bit.

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or maybe the sneaky "deed of acknowledgment" that banks get customers to sign after bankruptcy, that leaves them liable for the shortfall on the mortgage!

A friend of mine went bankrupt recently , he keep's the familly home which the O.R. allowed to be transfered to his wifes name , there is no equity in this property.

Apart form other debt's he had two short falls of about £50k each on two other houses that had been reppoed. The banks in question tried to get charges put against the house that he still lives in . The O.R. said no the security was charged against the reppoed houses and not his main home and refused the banks charges . He becomes a discharged bankrupt next month and the banks on those two houses can never chase him for the debt's.

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In the UK, bankruptcy wipes out mortgage debt.

You may be confusing this with the situation where the bank can repossess but does not make you bankrupt. In that case, they can chase you for years.

Can I just clarify something about bankruptcy that's bugging the hell out of me.

If I was to take on a huge mortgage for a house as my main residence, subsequently default and declare myself bankrupt, does that then mean I've just got myself a free house????

Or is that that once you've paid off the mortgage and own the house, rack up a load of other debts and go bankrupt, its this house that the creditors can't touch you for?

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Can I just clarify something about bankruptcy that's bugging the hell out of me.

If I was to take on a huge mortgage for a house as my main residence, subsequently default and declare myself bankrupt, does that then mean I've just got myself a free house????

Or is that that once you've paid off the mortgage and own the house, rack up a load of other debts and go bankrupt, its this house that the creditors can't touch you for?

No neither ,

If you have a huge mortgage on the house and go bankrupt , sometimes the OR will let that house be transfered to a spouce, if there is no equity in it. If there is equity they will sell it and take the equity. Once that house has been transfered the mortgage will still have to be paid.

If you own a house outright and rack up a load of other debt and go bankrupt they can and will take that house as it is an asset.

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Without meaning to be overly rude, I think you need to learn a bit about negotiating...

No offence taken. I've tried various approaches over the years, from various starting points relative to the initial asking point.

If you go straight in at asking price, you immediately make the vendor think that they've undervalued it. Start low, allow yourself to be negotiated up a bit.

In case 1, the property was clearly underpriced, I got to see it first and just went for it at asking, got outbid anyway. I've seen houses in this area go for 42% above asking and auction prices at 70% above guide. This agent seems to get their valuations way off. Their rightmove listings are badly presented which helps reduce viewings.

In case 2, the property had already been on for £25K higher for a month and received no offers so the vendors expectations have already been adjusted downwards.

So current evidence says that best practice for properties in my target area is to go for undervalued properties and offer £5k over!

Recent sales in target area:

325k auction guide, sold at over 550k

470k asking, sold at 475 (case 1)

500k asking, sold in a week (case 2 can be extended to be similar/better than this for around 425K)

550k asking, multiple offers at asking price in a week

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Can I just clarify something about bankruptcy that's bugging the hell out of me.

If I was to take on a huge mortgage for a house as my main residence, subsequently default and declare myself bankrupt, does that then mean I've just got myself a free house????

No. It will be repossessed.

The smart ones have the assets in one spouses name, and the debts in the other.

e.g

MrA with a shaky job takes a 125% Northern Rock Mortgage and buys biggest house he can find. All family spending goes on credit cards.

MrsA with a safe job banks every penny she can.

Then Mr A loses his job, loses the house and is bankrupt. However, Mrs A has banked a few years of net salary, enough to buy a house.

Debt and assets across the couple may balance to zero but MrsA is not affected by Mr A's bankruptcy.

Of course, Mrs A may like the look of Mr B and do a runner!

Or is that that once you've paid off the mortgage and own the house, rack up a load of other debts and go bankrupt, its this house that the creditors can't touch you for?

No. The equity in your house is an asset for bankruptcy purposes. Have a look at the web info on the Official Receiver.

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A friend of parents is getting repossessed this weekend. They bought the house for around £80k in the 90s. MEWed to high heaven and mortgage is now £210k!! Can't keep up the payments so about 6 months in arrears before he gave up and stopped paying. The bank has finally go the hump and said you have 1 month to sell so they put on the Market. He needs £210k to cover the mortgage then another £10k to cover fees and on top he says he wants at least £10k out of it!! (on top of the £120k he's already had and wasted!) so puts it up for £240k. £210k maybe £220k would be more appropriate IMO. Anyway now viewings, no offers and no interest and the months up so he's out. The thing is now he knows he'll be left with debt after the sale as it will probably go cheap so he is going bankrupt getting his debts written off and renting for £1100pcm up the month!

This should not be allowed I'm IMO he should be forced to pay at least some back as he has a good income it. I can't afford to rent for 1100pcm!

If I understand bankruptcy law correctly, it may well not be allowed. You can only go bankrupt when you are so deep in debt, that the free income you have left over after essentials is no longer enough to pay all the interest on what you owe, and that means escalating debts which cannot ever be paid.

However, if you have enough income to service your interest, and repay the capital, then you would be cheating your creditors by going bankrupt. If that is true, then the courts shouldnt let you go bankrupt.

Of course, the courts might let you go bankrupt even if you could pay, but they shouldnt.

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No. It will be repossessed.

The smart ones have the assets in one spouses name, and the debts in the other.

e.g

MrA with a shaky job takes a 125% Northern Rock Mortgage and buys biggest house he can find. All family spending goes on credit cards.

MrsA with a safe job banks every penny she can.

Then Mr A loses his job, loses the house and is bankrupt. However, Mrs A has banked a few years of net salary, enough to buy a house.

Debt and assets across the couple may balance to zero but MrsA is not affected by Mr A's bankruptcy.

Of course, Mrs A may like the look of Mr B and do a runner!

No. The equity in your house is an asset for bankruptcy purposes. Have a look at the web info on the Official Receiver.

I would like to finesse your housing scam a little. If you buy a house jointly, then I understand if one person goes bankrupt, then the other is responsible for the full amount of the mortgage. So Mrs A is affected by the bankruptcy. I think that there is also the idea of a 'beneficial interest' in the property, which Mrs A could buy from the receiver, but all of that money would go to the creditors.

Please feel free to correct me if I am wrong.

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I believe the only significant asset you can keep while going bankrupt is your pension fund.

But you might get away with that pot of gold you buried in the garden. ;)

Remember all purchases of gold over £10,000 per year are notifiable to the HMRC, so the pot of gold needs to be built up slowly over time otherwise the OR will know about it.

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I would like to finesse your housing scam a little. If you buy a house jointly, then I understand if one person goes bankrupt, then the other is responsible for the full amount of the mortgage. So Mrs A is affected by the bankruptcy. I think that there is also the idea of a 'beneficial interest' in the property, which Mrs A could buy from the receiver, but all of that money would go to the creditors.

Please feel free to correct me if I am wrong.

In my hypothetical case, Mrs A is not on the mortgage so is not affected by the bankrupcy. As a wife, she would be entitled to half the assets in the event of a breakup so has some protection but is not liable for the debt.

When I recently enquired about a mortgage, I could borrow a higher amount if the application was in my name rather than joint names (wife currently not working). So the banks do not insist that both names are on the mortgage and in my case, actually discourage it.

I worked for a CEO where all the assets were in the wifes name. He ran close to the wind (read as illegal insider trading related) on many financial deals and was often sued. He would never have to pay up since he had no assets. Yet he could still live in a £3m+ house, drive a couple of big German cars and pursue very expensive hobbies etc.

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I believe the only significant asset you can keep while going bankrupt is your pension fund.

Not necessarily all of it. Private pensions can be partly claimed by the Official Receiver. The lump sum is also at risk. You may have to pay out part of your pension, even if it is many years after the bankruptcy completed.

Basically, you have to hide it (illegal) or make clever use of the spouse as a separate entity.

Play fair, get screw3d.

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In my hypothetical case, Mrs A is not on the mortgage so is not affected by the bankrupcy. As a wife, she would be entitled to half the assets in the event of a breakup so has some protection but is not liable for the debt.

When I recently enquired about a mortgage, I could borrow a higher amount if the application was in my name rather than joint names (wife currently not working). So the banks do not insist that both names are on the mortgage and in my case, actually discourage it.

I worked for a CEO where all the assets were in the wifes name. He ran close to the wind (read as illegal insider trading related) on many financial deals and was often sued. He would never have to pay up since he had no assets. Yet he could still live in a £3m+ house, drive a couple of big German cars and pursue very expensive hobbies etc.

Seems like your CEO friend was able to abuse the law of 'fraudulent conveyance'. Sounds like you knew enough to put him and his wife away for a long time, not counting the seizing of his (her) assets.

If Mrs A is not on the mortgage, then if Mr A stops paying, then I assume that the bank could repossess the house and get their money back that way. If there was still money owing, it would be Mr A who would owe it, but I cant think of a legal mechanism for using Mr and Mrs for obtaining a free house or even part of a free house.

I know what you can do is this. Assume that you have a house fully paid for (no mortgage). Mr A runs up huge debts and has to go bankrupt. The creditors can raise a charge against the house in bankruptcy, but the couple can keep the house because of Mrs A's beneficial interest in it. Well at least until it is sold, they cant move or the creditors can get half the cash from the sale. Is that what you mean?

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  • 246 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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