14/06/2011 11:32:36
Pleasehelp
Posts: 1
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Hello everyone,
I was wondering if anyone could offer me some sage advice on a predicament that I've found myself in?
I have asked around a bit prior to this, but I think I really could use some legal advice as to where I stand.
I placed an offer on a repossession property a few weeks ago, which was accepted. The details were published etc (no responses from anyone else), and I went ahead and got solicitors to draw up all the necessary contracts etc.
This took longer than expected - with hindsight, I should have chased them much more, but I guess you live and learn.
Last week, I finally hear that everything is good to go for exchange (hurrah); within an hour, the estate agent has called to let me know that another 'significantly higher' offer has been placed on the property.
So, at this point I can't decide what to do. I love the property, and it's still a good price, so I place a slightly higher offer. At this point, the estate agent accidentally lets slip what the other offer is.
Mine had been **5, 500. The other buyer had rounded up to the next ten. However, I am a cash buyer with no chain (and I'm not purchasing in London/anywhere particularly pricey). Anyway, we (hangs head) get into a bidding war until I have matched her offer (at each point, even though I'm offering cash, the corporate client declines my offer)
This is all within the space of two days. The offer that she and I have placed has now been published (a legal requirement for reposessions). I then get a call this morning to say that my offer has been rejected. The paperwork from the solicitors in my name is ready, the same amount of money is there and I could exchange within a week, but still they have decided to go with her (even though presumably it'll take her a good few weeks to get everything in order).
In the end, I expressed my disbelief (the estate agents obviously did the whole 'well if we could we would give it to you...we can't understand why they would choose her' thing) and said that the money was on the table for 7 days, at which point I would look elsewhere.
This is the first time I've bought property, and the friends and family I've asked have all told me to put a higher offer in, but I'm not sure as, even though it might be worth it, what's to stop it from escalating further?
What is going on? What can I do?
Any advice very gratefully received!
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17/06/2011 11:25:25
Guest
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Unfortunately, gazumping can take place in conveyancing transactions (this is where the seller accepts a higher offer once they have already accepted your offer).
While it may be immoral, it is not illegal and the seller is perfectly within their rights to accept which ever offer they want to, whether the property is being sold by a mortgagee in possession or not. Their interest will be simply to get the best price they can and if you and your opponent are making the same offer, then its 50/50 as to whom they go with.
Whilst you already have contracts prepared, they are not legally binding until exchange so you do not have any legal recourse however disappointed you may be.
I assume the Solicitor acting for you has already done so, but it would be worth asking them to contact the Solicitor acting for the mortgagee in possession and explaining that you have matched the higher offer, you are a cash buyer and effectively ready to exchange now. I don’t know what the situation is with searches or whether you have elected to dispense with them but bear in mind that if you are having searches completed and don’t have the results then these could take a few weeks to complete. Your Solicitor will also have to request anti-money laundering evidence from you as you are a cash purchaser; this can be quite a time consuming task if it has not already been completed.
If you are not prepared to make a higher offer, then it would be sensible to push your advantage of being able to exchange quickly. It might make them “sit up and listen” if they haven’t already and depending on what response your Solicitors gets, you should then know how to proceed.
As mentioned above, the choice of who the property is sold to ultimately falls to the seller and if you think that they are going to chose your opponent over you every time, then it may be best to cut your losses and look for somewhere else. The choice, as always is yours to make.
I hope this has been helpful.
Barnetts
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