House Buying Nightmare

[MK_One]

We are going through the process of trying to buy a house on the Catalyst scheme. On the 15 April 2009 we paid £500 to a builder as a reservation on a house and filled in a reservation form in which they specified an unconditional contract exchange was to happen in May (the end of May gave us seven weeks) now they knew at the time that there was a delay with Catalyst of at least five weeks. Out of ignorance we thought this was okay as we believed that after this 5 weeks we could sign the contracts. Apparently this is not the case and there is a further step with Catalyst which the builders new about at the time but never informed us of. This would make it impossible for us to exchange contracts in May.

 

Now they are saying that they are putting the house back on hte market and that we could loose both the house and the money we have spent so far if another buyer is found (they have also taken an additional £400 for options).

 

Tempting though it is to pull out, we can't because we would loose the funding from Catalyst, though if they pull out we don't. If they do pull out are there any grounds for getting our money back as the original terms were unfair?

[buzby]

They may be unfair (ie to your detriment) but not in themselves illegal. Are you saying that the action taken by the developers placed your agreement in breach and this condition did NOT appear in your copy of the agreement? Or that you were unaware of the impact on your investmenr despite being made aware (and having a copy of the T&C) they've used to disenfranchise you?

[MK_One]

More that they knowingly took our money even though they knew we would be unable to complete within the deadline.

[raydetinu]

what does your solicitor say about this! I hope you have one, essential for house purchase!!

[buzby]

You couldn't use that as an argument.... what they 'knew' would be immaterial - they would need to call for the funds and then proceed based on the fact you hadn't paid.

[raydetinu]

Done a bit of research on this and your soloicitor is the key to this as they would or should have advised you at all stages of the scheme as to when you pay the deposit and stages through the process, mortgage/funds etc. etc.

[majik]

Hi

 

I have recently bought a house through this scheme and once you pay your "reservation fee" they take the house/flat off the market, that is what you are paying the fee for.

 

I believe that you then have 10 weeks to prove that you can provide the funds for the remainder of the purchase, Clearlt in your case this cannot be done as the property isn't complete yet, i would suggest you talk to your solicitor and your mortgage provider and get a agreement in principle from them, This would prove that you have access to the funds and once the builders/developers have completed the build you can have is surveyed and the mortgage approved.

 

I am not aware the Catalyst/Homebuy actually provide any funding, i am under the immpression that it is a government scheme and once you have been accepted you can apply for any of the 4/5 different schemes that they offer (Part buy part rent/cheap rent for key workers etc)

 

Hope this helps and really the solicitors would be the best people to explain it better, we had our mortgage from Halifax and the mortgage advisor had never dealt with this scheme so we had to advise him of how to do it and what he needed etc.

 

Regards

 

Majik/Dan

[Kraken1]

Also consider that they are probably bluffing. Developers are selling very little at the moment and they have a guaranteed sale from you. They are not going to sell your house to someone else because they can sell a similar house to them and get two sales. the pressure will have been for a completion date to tie in with the end of a financial year or something. It is just typical developer posturing in a cataclysmically bad market for them.

 

Even if they did withdraw, which I doubt, I think that you would get the option fee back to you and I reckon you could get the reservation fee back with a bit of creative letter writing.

 

get your solicitor to write laying down the law and giving clear express dates when stuff will happen. I wouldn't entirely discount what they knew about the process, I think this is relevant and helps you a bit providing you can show that they did know.