Jump to content
House Price Crash Forum
Sign in to follow this  
Possom

When Do You Become Obliged To Purchase?

Recommended Posts

This question relates specifically to purchasing residential property in Northern Ireland through either an estate agent or a repo through a receiver. Excluding purchasing property at an auction.

If someone bids on a house and eventually it goes sale agreed to that person, are they legally obliged to follow through with the purchase? For example, if something came up in the survey or if another, better located, house became available at the same price. Or for any other reason, can they simply say they don't want to follow through with the purchase if they have not signed the relevant documents?

Just wanted to know in case at some point I did sale agree on purchasing a place and then for some reason changed my mind before completion...!

Thanks.

Share this post


Link to post
Share on other sites

This question relates specifically to purchasing residential property in Northern Ireland through either an estate agent or a repo through a receiver. Excluding purchasing property at an auction.

If someone bids on a house and eventually it goes sale agreed to that person, are they legally obliged to follow through with the purchase? For example, if something came up in the survey or if another, better located, house became available at the same price. Or for any other reason, can they simply say they don't want to follow through with the purchase if they have not signed the relevant documents?

Just wanted to know in case at some point I did sale agree on purchasing a place and then for some reason changed my mind before completion...!

Thanks.

You can walk away any time up until you sign the contract with your solicitor, which is done after a full survey and mortgage paperwork has been completed (if required)

Share this post


Link to post
Share on other sites

As has been said, you can, as frequently happens, pull out any time before completion.

It's different in Scotland, and it comes up the odd time about changing the law in England and Wales but I can't see it happening.

Share this post


Link to post
Share on other sites

Under English law (which applies in NI and is different in Scotland) all transactions for land must be in writing and must be advised and witnessed by a Solicitor.

Therefore all offers in writing should include the phrase 'subject to contract'.

The contract itself will be subject to conditions such as-

Subject to finance-but you will have agreed a time frame for satisfying this condition.

Subject to Survey, again you will be given a window to have this professionally Satisfied and unless you have uncovered grave concerns it becomes binding.

If you have not entered a binding contract them neither the buyer or the seller is compelled to complete the sale.

Share this post


Link to post
Share on other sites

On a regular purchase both parties can pull out of the sale at any time until the contracts are signed. Circumstances of the purchase can be altered also, vendors can request a higher price or you can offer a lower one. If the survey gives you any cause for concern, you should absolutely try to negotiate a lower price to reflect any additional, unseen works that you now need to do. The vendor will expect it.

If you are buying a repo the same general principle exists, however there usually timescales attached which you need to adhere to. Take advice before even offering on a repo and always get a full survey done (could be around £600).

All right Possom :)

Share this post


Link to post
Share on other sites

On a regular purchase both parties can pull out of the sale at any time until the contracts are signed. Circumstances of the purchase can be altered also, vendors can request a higher price or you can offer a lower one. If the survey gives you any cause for concern, you should absolutely try to negotiate a lower price to reflect any additional, unseen works that you now need to do. The vendor will expect it.

If you are buying a repo the same general principle exists, however there usually timescales attached which you need to adhere to. Take advice before even offering on a repo and always get a full survey done (could be around £600).

All right Possom :)

If the 'full survey' is only costing £600 its not worth the paper its wrote on.

Share this post


Link to post
Share on other sites

If the 'full survey' is only costing £600 its not worth the paper its wrote on.

:) It has been several years from I paid for one. What would the aprox cost be now, for say a house valued at around 70 - 150?

edited to change figures

Edited by little fish

Share this post


Link to post
Share on other sites

Thanks guys! :)

Take advice before even offering on a repo and always get a full survey done (could be around £600).

Out of curiosity, what types of issues can arise from offering on a repo as opposed to offering on a normal sale?

Share this post


Link to post
Share on other sites

If the 'full survey' is only costing £600 its not worth the paper its wrote on.

You're not far wrong at £600. A full structural survey at that price level will be £600-£750 no problem.

Share this post


Link to post
Share on other sites

You're not far wrong at £600. A full structural survey at that price level will be £600-£750 no problem.

A simple 'drive buy' valuation, by a spotty estate agent for the bank almost costs that. A full structural survey with a qualified Engineer, with adequate PI insurance, who will get into the attic, check for dry rot, look at the sewers and all the structural walls would cost as much as £2,000.

In my view, on older houses it is well worth it.

Share this post


Link to post
Share on other sites

Thanks guys! :)

Out of curiosity, what types of issues can arise from offering on a repo as opposed to offering on a normal sale?

A sale of a repossession is somewhat different. The owner of the property at this stage is likely to either be an Administrator or a Fixed Charge Receiver. There is a difference as an administrator cannot be sued. A FCR can but extremely difficult. Basically because they have 'taken the property' by force if necessary they are unlikely to have all the paper work or history. They are not therefore required to disclose all they know or all they as owners ought to know. So it really is buyer beware. Purchasers normally make allowances for such things in their offer.

If you know the house as it may be your own house you are buying back or that of a bankrupted family matter then you have little to worry about. Your Solicitor is going to have to be a bit more thorough. Normally there are a list of pre-contract inqueries, which go into several pages asking the selling Solicitor if, for example there are any outstanding legal cases, enforcements etc. The purchasing solicitor can rely upon the answers as the selling solicitor, backed by the Law Society has to stand over the knowledge he has or ought to have in replying. With a repo the answer to every question will be 'Not so far as we are aware'.

Share this post


Link to post
Share on other sites

A simple 'drive buy' valuation, by a spotty estate agent for the bank almost costs that. A full structural survey with a qualified Engineer, with adequate PI insurance, who will get into the attic, check for dry rot, look at the sewers and all the structural walls would cost as much as £2,000.

In my view, on older houses it is well worth it.

Sorry no, you are miles off.

Halifax is expensive and their valuation at this level, a drive by with a spotty agent will cost £240 - £315.

HSBC under £200.

http://www.halifax-intermediaries.co.uk/products/mortgages/valuation_fees/default.aspx

Do you know any RICS members with inadequate PI cover?

You'll get this done easy under £1000.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   212 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.