cheri-pie

Just a quickie to either put my mind at ease or make it worse :scared:

Does anyone know if buyers can back out of a house after they have exchanged contracts?

I thought I read on here somewhere that it had happened to someone - I hope I was dreaming

Clippy

I don't think they can, not once contracts have actually been exchanged. I'm not 100% though sorry

Scotty1

If you mean in england - yes they can but they will loose their deposit which is likely to be 10-20% of the purchase price and you get to keep it for the breach of contract. It happens rarely but it does happen

Scotty

Suni&Jay

They can pull out up until the completion, it just means that they are liable for all cost. It is very unlikely that any one would pull out after exchange because of the hefty penatlies

cheri-pie

Is the deposit optional or does everyone always pay a deposit (sorry, I have no idea on these things) and when does the deposit get paid, on exchange of contracts or before?

Scotty1

In england, an exchange of contracts is the time the person buying your house has to put up a deposit and this is what enforces the contract. This is held by your solicitor until completion when they purchasers pay the balance and the sum is then wired to you less legal and agent fees. The buyers can ask for a reduced deposit (this sometimes happens when 95% of the purchase price is coming from a mortgage provider). If they don't complete you can keep the depost and potentially sue them for breach of contract if your costs of the sale not going through are greater than the deposit (not a good plan unless millions involved!)

This is why most sales fall through before exchange and only rarely afterwards. I have always planned on the sale being likely to fall through until exchange and then assumed I would be moving afterwards. Exchange normally takes place a couple of weeks to a month before completion, but again it doesn't have to.

Scotty

marco121068

This guide explains it all quite well

Wendy

some answers for you here

http://www.adviceguide.org.uk/index/...ing_a_home.htm

helen/andy

I know how you are feeling,we have shipping company booked,all our lives in boxes around us and am waiting for exchange of contracts on the house to be able to book flights ect,it was supposed to be today now it looks like tommorrow :scared: exchange of contracts is legally binding and ill feel alot more secure once they have,thing is we are at the top of the chain so its fingers crossed it all goes smoothly tommorrow.Helen.

steve`o

they will have to ppay a minimum of 10% of the purchase price to back out after contracts have been exchanged

( just checked our contracts )

regards steve

thebears

They can but only fools would.

They will loose the deposit they paid (so dont allow no or less than 10% deposit - watch first home buyers)

Depending on your contract of sale you can also claim compensation.

Years ago we had our buyer pull out because they were declared bankrupt (great timing). Dont worry the chances of this happening to any of you must be a zillion to 1.

We however managed to get bridging finance at the 11th hour - The consequences for us would of been loosing our 10% deposit. Not a nice feeling to suddenly be loosing £90K at no fault of your own.

Graham67

They can in England I think, definitely not in Scotland or they incur all sorts of penalties and have to pay all your associated costs. Ireland not too sure if in doubt phone your solicitor or citizen advice. I was in the same scenario don't leave it to the last minute if you are in any doubt.

cheri-pie

Thanks for replying everyone. We are going for a long completion date to make sure we are all sorted and I couldn't bear the thought of keeping everything crossed until completion. At least things should still go ahead once we have exchanged.

Thanks again x