Buyer just pulled out!
Feb 5th 2009 | 9:36 am
#16
Lost in BE Cyberspace
Joined: Aug 2005
Posts: 13,402
From: South of Calgary
Re: Buyer just pulled out!
I have never known anyone in Canada claim the "buyer just pulled out" after an acceptance of offer has been signed and the appropriate deposit made, without the purchaser facing a loss of part/all of their deposit. If the Offer to Purchase has conditions attached then the property remains on the market, and should a better offer be made by another potential buyer, then the first offerer has 24 hours to withdraw his/her conditions or firm up the original offer. If they withdraw, then their deposit is returned.
The problem with the England/Wales system, as I understand it, is that someone can offer to buy, and on the date set for closing, state they are not exchanging contracts, thereby leaving the seller hanging out to dry with no penalty to be paid for the buyer's actions.. Presumably they can have as many purchases on the go as they like at any given time and leave any/everyone on the hook.
If this is not correct then I am happy to be shown the way. A deposit of minimum 10% would give a reasonable indication that the buyer is serious. As a seller I would never accept less than that.
The problem with the England/Wales system, as I understand it, is that someone can offer to buy, and on the date set for closing, state they are not exchanging contracts, thereby leaving the seller hanging out to dry with no penalty to be paid for the buyer's actions.. Presumably they can have as many purchases on the go as they like at any given time and leave any/everyone on the hook.
If this is not correct then I am happy to be shown the way. A deposit of minimum 10% would give a reasonable indication that the buyer is serious. As a seller I would never accept less than that.
If both deals were legally binding, I would rather have a buyer pull out in England than in Canada, as the seller is likely to have a larger deposit in England and the legal system is much faster to the point of getting to trial in England that in the common law jurisdictions of Canada.
Only fools in England and Wales exchange and complete on the same day. Most exchange 14 days before completion.
The problem that arises is that sellers usually assume that they have a deal when they verbally accept a verbal offer from the buyer. They have no deal until the contracts have been exchanged, just like there is no deal in Alberta until both parties have signed the offer to purchase contract and all conditions have been met.
As I said before, in either country, the deal isn't binding until it's binding. As a solicitor in England and Wales, I always advised clients to keep their property on the market and continue to market it until they had exchanged contracts. Usually they didn't and were then very upset when their buyer pulled out.
The other huge issue in England and Wales is the chain. Everybody wants to exchange and complete on the same day and so, when one deal tanks, they all do. This doesn't happen as much in Canada as, usually, the deals are not interdependent, usually because of bridging loans. These are available in England and Wales as well but very few use them.
Feb 5th 2009 | 9:42 am
#17
Banned
Joined: Oct 2008
Posts: 3,824
From: the GTA
Re: Buyer just pulled out!
Thank you, I stand corrected.
Feb 5th 2009 | 12:21 pm
#18
BE Forum Addict
Joined: Dec 2006
Posts: 1,377
From: Cowichan Valley, Vancouver Island, BC
Re: Buyer just pulled out!
The BIG problem is the LONG, LONG wait between accepting an offer and being in a position to exchange contracts
This can last for weeks (even months) while
1. The buyer arranges a mortgage
2. The mortgage company arranges a survey
3 Both sets of solicitors communicate (or not!) with each other over endless questions - both important and trivial.
4. Both Solicitors exchange contracts.
If you are lucky this happens without one (or both) set of solicitors going on 2 weeks holiday without informing their clients
This can last for weeks (even months) while
1. The buyer arranges a mortgage
2. The mortgage company arranges a survey
3 Both sets of solicitors communicate (or not!) with each other over endless questions - both important and trivial.
4. Both Solicitors exchange contracts.
If you are lucky this happens without one (or both) set of solicitors going on 2 weeks holiday without informing their clients
Feb 5th 2009 | 8:29 pm
#19
Thread Starter
Forum Regular
Joined: Jul 2008
Posts: 191
From: Richmond, BC
Re: Buyer just pulled out!
The BIG problem is the LONG, LONG wait between accepting an offer and being in a position to exchange contracts
This can last for weeks (even months) while
1. The buyer arranges a mortgage
2. The mortgage company arranges a survey
3 Both sets of solicitors communicate (or not!) with each other over endless questions - both important and trivial.
4. Both Solicitors exchange contracts.
If you are lucky this happens without one (or both) set of solicitors going on 2 weeks holiday without informing their clients
This can last for weeks (even months) while
1. The buyer arranges a mortgage
2. The mortgage company arranges a survey
3 Both sets of solicitors communicate (or not!) with each other over endless questions - both important and trivial.
4. Both Solicitors exchange contracts.
If you are lucky this happens without one (or both) set of solicitors going on 2 weeks holiday without informing their clients
Feb 5th 2009 | 9:01 pm
#20
Forum Regular
Joined: Feb 2008
Posts: 170
From: Salisbury
Re: Buyer just pulled out!
I am so sorry to hear this, people SUCK! I really hope that you get that profitable sale soon. Karma coming your way!
Feb 5th 2009 | 9:53 pm
#21
BE Enthusiast
Joined: Sep 2008
Posts: 679
From: Live - Lancs/ Business - West Yorks.
Re: Buyer just pulled out!
oh no im sorry about that, I hope you get another one soon. Karma sent. actually I have absolutely no idea how to send karma????
could anyone help???
could anyone help???
