Buyers meant to get keys today but find out they've been refused life insurance!

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Redback

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Hoping for some positive vibes!

We are both selling an apartment and buying a house, with all keys supposed to transfer today and Wednesday respectively.
We were supposed to be drawing down on our mortgage today- with all of our conditions satisfied with our bank. Our solicitor was waiting on the proceeds from the sale of our apartment to be in the account today.

So 4 o clock comes and we find out that the purchasers of our apartment have not transferred the funds due to the bank not releasing them as they were refused life insurance! Our solicitor then faxed a letter to our bank to pause the drawdown of our mortgage.

We spent the weekend moving out, the keys are with the auctioneer ready for them to collect!
The seller of the house we are supposed to move into Wednesday and get the keys from too also moved out the weekend.
I am beyond dismayed, how the purchasers left it until today to realise they were refused life insurance for the mortgage.
All I know at this stage is that it doesn't appear to be paperwork in transit but rather they were actually refused life insurance. :(

Apparently their solicitor has the deeds of the apartment and they signed and paid their deposit last week.

Im scared if the sale of the apartment now falls through we will lose the house we are ready (apart from the much needed proceeds of apartment) to move in to !!!

Is it common for life insurance to fall apart on the day they should be collecting keys? Surely this should have been flagged before they signed contracts.I should perhaps add they are foreign so maybe this is causing problems.
Apparently now they have their broker trying to secure mortgage protection from another provider. How long / hard or impossible is this?!
 
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Plenty of threads of people who have been refused. Might be worth chasing the posters down and see how it worked out in the long run.

Various reasons such as lying about medical conditions, admitting to taking recreational drugs and quite simply not shopping around.

Either way it should never have gotten to this stage and they surely should have known long ago and hoped to get away with it.
 
Oh dear, they should really have checked this before now but they may not have been aware of the importance of it. It's something that can cause significant stress if left to the end of the process.most likely they will be granted a waiver from their mortgage company but it could take a few weeks yet if they have to do medicals or get the medical assessment redone by doctors.
I had similar issue but knew I was likely to be refused so thought I had cleared everything up front, the bank insisted on an additional refusal and the whole process added probably a month to the sale
 
Thanks for your replies! Have searched high up and low down for answers...but only they know what happened and why.
So so stressful. Felt we were so close but until you've the keys you've nothing!
 
Hi Redback

There isn't much you can do other than to apologise to the people whose house you have bought.

It's very likely that the buyers of your house will get the life assurance sorted and will complete the sale.

But to protect yourself, you should put the house back on the market, seeking a quick sale.

Your solicitor will have to write formally to the buyers telling them to complete the sale. If they don't, they will lose the deposit and may be liable for further losses.

Brendan
 
Thanks again for the reply Brendan.
However , I actually asked our solicitor if they'd lose their 10% deposit and I don't think they will as there is no condition that we could keep it.

To make matters worse I think our vendor is selling to buy... God I hate these chains.
I feel just awful for vendor and us! Wasn't even anything we could have helped.
I'm so annoyed it arose so last minute today! everyone had moved except them!!!
 
I don't think putting it back on the market is at all a good idea. Everybody in this chain is stressed out as it is and this would only add more stress and badwill. In any case it's a mortgage approved buyer so it would be nuts to go back to market. Life insurance should be fairly handily sorted unless there is some major health issue that can not be covered, then the banks can waive the requirement.
 
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