Urgent legal advice needed: Property

teamfunk

Hello, some quick advice would be much appreciated. My situation, sorry, it's a bit complex:

-Went sale agreed on 'property 1' in summer 2013
-Delays due to seller being in negative equity and difficulty obtaining the vendor bank approval to release the property resulted in the deal dragging out and being in a state of non-progress for several months
-Started new search beginning 2014, but kept property 1 as sale agreed in case it ever came through
-Sale agreed on property 2 in early 2014. Subsequent ongoing issues with vendor solicitor; slow responses to standard pre-contract queries, etc etc
-Finally was able to exchange signed contracts and draw down mortgage in July 2014 for property 2. The NEXT DAY we get word that property 1 approval finally was received by vendor bank
-Attempted to close on property 2 after drawing down mortgage, and was out of the blue put on notice by estate agent that vendor was in receivership and we would not be able to close. Initiated inquiries with both vendor solicitor and solicitor for receiver to try to close, and was unable to do so quickly. As a result we had to return the mortgage funds to the bank, who put the file on a short moratorium
-In the meanwhile, obtained separate home loan offer on property 1 from a different bank (has to be home loan rather than an investment loan due to size of property)
-Informed my solicitor at this time (July) that property 1 loan offer was going to be issued as a home loan, same as property 2. At that stage I had not been released from property 2 and contracts were in existence, and it was unclear if the transaction was dead in the water or if some sort of agreement would be reached with the receiver. I told my sol at that time that both were homeloans, and IF one came through I would in good faith enter that contract with intent to move into that property, and IF the other one came through in short order I would switch my primary residence to the 2nd one. We knew that both the transactions could end up closing in and around the same time, and I asked if this would pose any issues on her side, and if so I would need to know right away to secure other arrangements, and she said no, no issues on her side
-No movement on property 2, so last week requested return of deposit since the vendor was unable to close. The deposit has not been returned, and it looks like the receiver and vendor solicitor are close to an agreement to release the property and allow us to close, possibly next week, and that they intend to hold me to the signed contracts.
-Property 1 is on a vendor deadline of end of September and we are working to resolve final pre-contract queries to also close that one in the coming weeks.
-Sol informs me today that she cannot do 2 undertakings for 2 home loans so close to one another - the exact thing I had asked if it would cause any issues and she had previously said no. She now claims that when she advised me of that there was going to be a 'reasonable gap' between the two closing (untrue - we didn't know if/when either would close and knew that both the moratorim on #2 and the seller approval on #1 expired at the same time: end of september) and that she had been now advised bv other solicitors that if they were to close in the same month that she could not do both (read: covering her own butt and changing her position at the last minute)
-Sol is advising that the only way to proceed with property 1 is to get investment loan (not possible and certainly not possible by 27/9); obtain a new solicitor, or go as a cash purchaser
-after a heated conversation sol indicated she would no longer represent me on property 1 and to find other solicitor

This puts me in a very tight and difficult position - we have about 4 weeks until deadline to close on property 1. This gives me very little time to obtain new representation, possibly get a new loan offer, issue new contracts, etc.

My questions:

1) Is there any legal reason the solicitor cannot close 2 undertakings in quick succession both as home loans? My argument is that we got both loan offers while the other property was in a state of uncertainty, and that IF one comes through quickly after another closing, I will simply switch my primary residence - this is reasonable considering the chain of events
2) Does the lawyer have any legal obligation to disclose these details to the bank (at one stage she indicated that if we close on property 1 she would need to provide them a statement from me declaring the status of the other property) - my understanding is it's her legal obligation to inform me of my requirement to inform the bank, but it is not her obligation to ensure this happens or to interfere with this directly
3) Can the sol legally drop me like this mid-transaction and leave me possibly to lose the entire deal on property 1 as a result of her stepping down?

Thank you.

loremolis

teamfunk wrote: »

Hello, some quick advice would be much appreciated. My situation, sorry, it's a bit complex:

-Went sale agreed on 'property 1' in summer 2013
-Delays due to seller being in negative equity and difficulty obtaining the vendor bank approval to release the property resulted in the deal dragging out and being in a state of non-progress for several months
-Started new search beginning 2014, but kept property 1 as sale agreed in case it ever came through
-Sale agreed on property 2 in early 2014. Subsequent ongoing issues with vendor solicitor; slow responses to standard pre-contract queries, etc etc
-Finally was able to exchange signed contracts and draw down mortgage in July 2014 for property 2. The NEXT DAY we get word that property 1 approval finally was received by vendor bank
-Attempted to close on property 2 after drawing down mortgage, and was out of the blue put on notice by estate agent that vendor was in receivership and we would not be able to close. Initiated inquiries with both vendor solicitor and solicitor for receiver to try to close, and was unable to do so quickly. As a result we had to return the mortgage funds to the bank, who put the file on a short moratorium
-In the meanwhile, obtained separate home loan offer on property 1 from a different bank (has to be home loan rather than an investment loan due to size of property)
-Informed my solicitor at this time (July) that property 1 loan offer was going to be issued as a home loan, same as property 2. At that stage I had not been released from property 2 and contracts were in existence, and it was unclear if the transaction was dead in the water or if some sort of agreement would be reached with the receiver. I told my sol at that time that both were homeloans, and IF one came through I would in good faith enter that contract with intent to move into that property, and IF the other one came through in short order I would switch my primary residence to the 2nd one. We knew that both the transactions could end up closing in and around the same time, and I asked if this would pose any issues on her side, and if so I would need to know right away to secure other arrangements, and she said no, no issues on her side
-No movement on property 2, so last week requested return of deposit since the vendor was unable to close. The deposit has not been returned, and it looks like the receiver and vendor solicitor are close to an agreement to release the property and allow us to close, possibly next week, and that they intend to hold me to the signed contracts.
-Property 1 is on a vendor deadline of end of September and we are working to resolve final pre-contract queries to also close that one in the coming weeks.
-Sol informs me today that she cannot do 2 undertakings for 2 home loans so close to one another - the exact thing I had asked if it would cause any issues and she had previously said no. She now claims that when she advised me of that there was going to be a 'reasonable gap' between the two closing (untrue - we didn't know if/when either would close and knew that both the moratorim on #2 and the seller approval on #1 expired at the same time: end of september) and that she had been now advised bv other solicitors that if they were to close in the same month that she could not do both (read: covering her own butt and changing her position at the last minute)
-Sol is advising that the only way to proceed with property 1 is to get investment loan (not possible and certainly not possible by 27/9); obtain a new solicitor, or go as a cash purchaser
-after a heated conversation sol indicated she would no longer represent me on property 1 and to find other solicitor

This puts me in a very tight and difficult position - we have about 4 weeks until deadline to close on property 1. This gives me very little time to obtain new representation, possibly get a new loan offer, issue new contracts, etc.

My questions:

1) Is there any legal reason the solicitor cannot close 2 undertakings in quick succession both as home loans? My argument is that we got both loan offers while the other property was in a state of uncertainty, and that IF one comes through quickly after another closing, I will simply switch my primary residence - this is reasonable considering the chain of events
2) Does the lawyer have any legal obligation to disclose these details to the bank (at one stage she indicated that if we close on property 1 she would need to provide them a statement from me declaring the status of the other property) - my understanding is it's her legal obligation to inform me of my requirement to inform the bank, but it is not her obligation to ensure this happens or to interfere with this directly
3) Can the sol legally drop me like this mid-transaction and leave me possibly to lose the entire deal on property 1 as a result of her stepping down?

Thank you.

The best advice here is that you need to see another solicitor who is experienced in conveyancing.

The questions you ask are complex and require professional consideration. Given that large sums of money are involved, would you really trust advice from strangers on the interwebnet?

teamfunk

Obviously I am seeking advice of another solicitor. Clearly I can not do that over the weekend, and I'm curious if anyone has any advice or thoughts on this in the meanwhile.

Marcusm

I would put your prospect of having a reputable solicitor in full possession of the facts acting for you in this matter to be very low. It is simply inconceivable that you can truthfully apply for two "home loans" for purchases of sepsrste properties in such a short period of time; indeed giving undertakings on one property while another is in prospect would seem to be questionable.

For your own position, you might also want to consider section 7 of the Criminal Justice (Theft and Other Fraud Offences) Act 2001.

davo10

Is is still the case where home loans are provided at a lower interest rate than investment loans?. If I am reading your post correctly, you are, or your solicitor on your behalf, telling both banks that the loans are for a property you intend to use as your home/primary residence. This is untruthful and any solicitor would be uncomfortable with this, you are asking him/her to help you gain funds by deception, knowing that the loan offer could be withdrawn or provided at a higher rate if the bank was informed that one is an investment property.

teamfunk

The issue is that both the property purchases have been complicated and on the brink of falling through. Today one of them doesn't have the agreement of the receiver and seller solicitor on terms; the other has unresolved pre-contract queries and a likely request of extension of the seller's deadline from their bank. If one goes through (unclear which can/would go through first) then IF the second one goes through, I would inform the first bank that circumstances have changed and I plan now to rent it out, so I may in good faith enter the second one as a home loan. If that means that the rates go up on the first one so be it.

NoQuarter

Hang on and ill do my job for you for free there over the weekend

Marcusm

teamfunk wrote: »

The issue is that both the property purchases have been complicated and on the brink of falling through. Today one of them doesn't have the agreement of the receiver and seller solicitor on terms; the other has unresolved pre-contract queries and a likely request of extension of the seller's deadline from their bank. If one goes through (unclear which can/would go through first) then IF the second one goes through, I would inform the first bank that circumstances have changed and I plan now to rent it out, so I may in good faith enter the second one as a home loan. If that means that the rates go up on the first one so be it.

And you appear to propose to falsely misrepresent them both as involving principal residences. Can you not just step back and see how ludicrous your proposition is! I assume that the financial info provided to each institution did not involve disclosure of the other loan!

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btw - I've always wanted to say this - You lost me at Hello

hullaballoo

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