Mortgage - Solicitor raising survey concerns

KarmaGarda

Hi,

I have a question about a survey I had done last week on a house I'm looking to buy.

I requested a guy to undertake a survey for my own peace of mind (wasn't requested by the bank, just wanted it myself).

When the survey came back the surveyor raised 1 item in particular that wasn't conforming to building regulations. Now, it's an easy thing to fix, but it'll cost me a few grand. So I will re-negotiate with the agent on a new price to cover it.

But, and here's potentially my mistake, I kept the solicitor in the loop about the issue. Now the solicitor tells me he will have to inform the bank about this problem as the bank will have to decide if they are willing to give out the loan with the house having this particular problem. I asked him not to, but he said as it's not done to regulation he has to inform them.

So I guess I'm looking for the legal angle on this, do they have to go back to the bank with this information? Even though the survey wasn't requested by the bank? The valuation came back no different to my original offer, so I really don't understand why it needs to be raised. It's not a major structural problem like a wall about to collapse or something.

Advice much appreciated.

hullaballoo

I don't understand. You are looking for the legal angle in your words but your solicitor has already given you the legal angle.

It sounds like you're looking for the illegal angle.

KarmaGarda

No, I'm not looking for the illegal angle, please don't put words in my mouth.

Someone else suggested to me that they were being over diligent and weren't legally obliged to offer the information to the bank. If they are I'm willing to accept that.

hullaballoo

I wasn't putting words in your mouth. Your solicitor has given his professional legal opinion that the bank has to be informed in relation the issue.

You are paying this person for this advice but at the same time, here you are trying to second-guess that paid-for professional legal opinion.

Do you see how that might not be a good idea?

KarmaGarda

hullaballoo wrote: »

Do you see how that might not be a good idea?

No I don't. People regularly request a second opinion.

nuac

KarmaGarda wrote: »

No I don't. People regularly request a second opinion.

Have practised in conveyancing for 50+ years

Very small number of clients have ever sought a second legal opinion,

That number is well exceeded by the number of clients whom I have told to see another solicitor.

imho your solicitor is advising you properly.

alig123aileen

or maybe your solicitor knows the longer the delays the purchase the more per hour rates he can earn

KarmaGarda

nuac wrote: »

Have practised in conveyancing for 50+ years

Very small number of clients have ever sought a second legal opinion,

That number is well exceeded by the number of clients whom I have told to see another solicitor.

imho your solicitor is advising you properly.

Thanks Nuac.

I only asked because it had been suggested by someone that they didn't legally have to volunteer this information. Granted this person that suggested it isn't a solicitor, but is a professional in the mortgage industry, so in general knows what they are talking about.

I guess not this time.

alig123aileen wrote: »

or maybe your solicitor knows the longer the delays the purchase the more per hour rates he can earn

Flat rate, so they don't have anything to gain that way! I just got the impression it was over-diligent.

JimsAlterEgo

KarmaGarda wrote: »

Flat rate, so they don't have anything to gain that way! I just got the impression it was over-diligent.

they have to report something brought to their attention to the banks, failure to so would result in them being possibly sued at a later stage.

KarmaGarda

JimsAlterEgo wrote: »

they have to report something brought to their attention to the banks, failure to so would result in them being possibly sued at a later stage.

Ah, you've put it in a context that makes me understand. It's not from my perspective, but the banks perspective. If something went wrong the bank could sue the solicitor I guess.

Anyway, I did wonder if reporting it back to them was my mistake. I really didn't need to raise this with anyone as it was myself that requested the survey. Darn it anyways!

vrt12

I would have thought you needed a 2nd opinion on the survey, not the legal advice. But you've already told your solicitor so I doubt a 2nd opinion will change the situation at this stage.

Victor

In general terms, buildings only need to match the building regulations in place for when the building (or any extension or conversion) was built.

However, there could be things that might have complied at the time, but which people would have qualms for now, e.g. fire alarms, gaps in balustrades, poor insulation and ventilation, etc.

If there are structural problems, including but not limited to pyrite, then the bank might not have an asset that matches the loan value.

KarmaGarda

Victor wrote: »

In general terms, buildings only need to match the building regulations in place for when the building (or any extension or conversion) was built.

However, there could be things that might have complied at the time, but which people would have qualms for now, e.g. fire alarms, gaps in balustrades, poor insulation and ventilation, etc.

If there are structural problems, including but not limited to pyrite, then the bank might not have an asset that matches the loan value.

It's to do with the septic tank as opposed to the house itself. I won't go into the finer details, but unfortunately it does needs to be fixed. In short, it's not structural.

chops018

Your Solicitor can't certify title to the bank if you are not buying the property with good marketable title i.e. it can't be in breach of any regulations. The bank has to ensure this and your Solicitor does this by certifying that there is good title. The Solicitor also cannot give certain undertakings to the bank either if they were aware of things like this. The Solicitor would inform the bank, and possibly they will still consent to the sale and go ahead and give you the loan. There's no guarantee that if you went ahead with the purchase that you would sort this out. This would create a problem down the line if you were selling, which the bank wouldn't like.

Be slightly different if you were a cash buyer. Solicitor would advise you not to buy unless it was sorted, but you could say well I don't care it's my money so let's go ahead. Completely different when there's mortgages and banks involved.

Follow your Solicitors advise. Of course you can get a second opinion, but then you'd have to pay another Solicitor for that, they would go through the title, survey's, reports etc. and if they're competent they should see the same problem and advise you what your current Solicitor is advising you.

KarmaGarda

chops018 wrote: »

Your Solicitor can't certify title to the bank if you are not buying the property with good marketable title i.e. it can't be in breach of any regulations. The bank has to ensure this and your Solicitor does this by certifying that there is good title. The Solicitor also cannot give certain undertakings to the bank either if they were aware of things like this. The Solicitor would inform the bank, and possibly they will still consent to the sale and go ahead and give you the loan. There's no guarantee that if you went ahead with the purchase that you would sort this out. This would create a problem down the line if you were selling, which the bank wouldn't like.

Be slightly different if you were a cash buyer. Solicitor would advise you not to buy unless it was sorted, but you could say well I don't care it's my money so let's go ahead. Completely different when there's mortgages and banks involved.

Follow your Solicitors advise. Of course you can get a second opinion, but then you'd have to pay another Solicitor for that, they would go through the title, survey's, reports etc. and if they're competent they should see the same problem and advise you what your current Solicitor is advising you.

I think I will indeed follow his advice. Seems to be pretty unanimous that it's sound advice so I guess I need to bite the bullet and accept a few more delays.

Now, I might bow out of this part of boards... it's a scary place... First post on here and I get mocked by the forum owner (is forum owner the correct term??)

Anyway, have fun y'all and don't go doing anything illegal!

hullaballoo

I wasn't mocking you but that's the problem with communicating by text.

Maybe I should have peppered my post with these lads: to make it clear the "looking for the illegal angle" comment was tongue-in-cheek.

Pat Mustard

KarmaGarda wrote: »

I only asked because it had been suggested by someone that they didn't legally have to volunteer this information. Granted this person that suggested it isn't a solicitor, but is a professional in the mortgage industry, so in general knows what they are talking about.

I guess not this time.

Generally speaking, in order to draw loan monies on foot of a mortgage on a property, a solicitor has to give an undertaking to the relevant financial institution/bank that the security property has "good marketable title".

"Good marketable title" has a specific legal meaning. It includes compliance with planning permission and building regulations.

A solicitor's undertaking is a promise that should not be broken. If the solicitor breaches his undertaking, he can get into trouble with the Law Society; the kind of trouble that could threaten his livelihood.

When there is some deviation from "good marketable title" such as where a property has issues of non-compliance with planning permission/building regs, the solicitor has to get the consent of the bank to modify his undertaking.

Solicitors have to clear these matters with the bank, regularly.

Youredeadright

KarmaGarda wrote: »

I think I will indeed follow his advice. Seems to be pretty unanimous that it's sound advice so I guess I need to bite the bullet and accept a few more delays.

Now, I might bow out of this part of boards... it's a scary place... First post on here and I get mocked by the forum owner (is forum owner the correct term??)

Anyway, have fun y'all and don't go doing anything illegal!

Mod.
Post deleted. imho the advice therein is irresponsible

Samuel T. Cogley

KarmaGarda wrote: »

I think I will indeed follow his advice. Seems to be pretty unanimous that it's sound advice so I guess I need to bite the bullet and accept a few more delays.

Now, I might bow out of this part of boards... it's a scary place... First post on here and I get mocked by the forum owner (is forum owner the correct term??)

Anyway, have fun y'all and don't go doing anything illegal!

If only Hullaballoo owned the forum! :pac:

NUTLEY BOY

Just a view.

See this from the solicitor's perspective. He has possession of knowledge that is material. If he says nothing and there is comeback (which can take many legal forms too numerous to detail here) guess who will be one of the first people in the firing line ? Yes, the solicitor.

By seeking to instruct a solicitor to remain silent on the facts disclosed you actually ask him to collude in impropriety and would also compromise him professionally. I am sure that is not the OP's intention but it could be the actual consequence.

GavMan

The bank will probably just request that the issue is remedied before the sale can be completed. It doesn't sound like a show stopped so they will probably take a pragmatic approach

Victor

GavMan wrote: »

The bank will probably just request that the issue is remedied before the sale can be completed. It doesn't sound like a show stopped so they will probably take a pragmatic approach

Not having sufficient land to let a septic tank have sufficient drainage could be a very real problem and render the property uninhabitable.