Buying in a Chain - Advice Welcome

[laura28]

Hello,

We are property hunting at the moment and I have some queries that I can't seem to get a straight answer from estate agents on, I would appreciate some assistance/advice.

We are going to be availing of a negative equity/tracker mover mortgage with AIB. The terms of this stipulate that the old mortgage must be cleared and new mortgage drawn down within 28 days to avail of this mortgage product.

We are looking at new builds and are required to put down a €6k deposit & balance of 10% of price within 21 days. We have savings so no issues with this.

Now, when we mention to any of the estate agents that we are in a chain and need to sell our current property (2 bed apartment. in an area where sales have been moving fast). They advise that we put our property on the market ASAP. If the property then sells quickly (great!) we are in a spot of bother as new home not ready for approx. 6 months. Where do we live in the interim. We can't complete the sale and rent while we wait as the old & new mortgage need to be cleared and drawn down within 28 days. A solution many estate agents have offered is that the same agent (them!) deal with the sale and purchase of new home and they can then manage this issue.

Some have also stated that we couldn't sign contracts on our new property until we are sale agreed on our current property, is this correct?

Am I missing something? How have others managed this?

 

[mf1]

You need to sit down with a solicitor (not an estate agent) and walk through this process.

Your biggest problem is the negative equity/tracker mover mortgage and the 28 day time limit.

Probably the best thing to do is to put your own property on the market and see if you can find a purchaser who is willing to hang around, to close, until you are ready to move out. Most purchasers take the view that if you want to sell, and you want money from them, you need to move out. They are not interested in your circumstances.

More likely, you'll get a good feeling about the chances of your place selling when you are ready.

"Some have also stated that we couldn't sign contracts on our new property until we are sale agreed on our current property, is this correct?"

Your problem is being tied in to a contract to buy when your own sale has not closed - what happens if your purchaser can't get funding?

The best advice always is to sell first, bank the money ( if any) and move home to mammy or sleep on your best friends sofa.

Your circumstances are such that you will need a great deal of luck and a very patient, solvent purchaser to wait on you while you try and tie in two, un-related transactions. Many people in your circumstances take the view that both transactions are related - and yes, they are, but only to them - not to their purchaser or their vendor.

mf

 

[laura28]

Thank you very much for the reply mf. It's all much clearer to me now. I have to admit to feeling very stressed and overwhelmed at the idea of co-ordinating the above. It's one of the reasons we have been focussing on new builds as we thought it might be easier to get an idea of time lines etc. In an ideal world we would place a deposit on a new build now, with a view to moving in in March and then put our own property on the sale in early January. That is all seeing to be idealistic and simplistic now. For obvious long term reasons we are very keen to hang on to our tracker rate going forward.