Buying my first house - extremely disappointed - no keys - cannot be registered on Land Registry - Advice Needed

[emrk123]

Hi all,

Three weeks ago, I was told that on the Friday I would be able to collect the keys to my new house, I was so excited and happy, I had a lot of purchases ordered for delivery. On the day I was to receive my keys I got the bad news that the closing searches found that there was an outstanding mortgage with 25 years from EBS which has since gone bust on the house I want to purchase - This mortgage is not from the current sellers, it belongs to previous seller.

Since I have gotten more information from my solicitor. I have found out that the seller's solicitor knew about this all along - for 25 years. Sellers solicitor has lost the original document stating the mortgage from EBS had been paid off/vacated. The sellers solicitor has a copy of the document stating the mortgage has been paid, but for the land registry the copy is not sufficient. My solicitor said he had a condition withe the bank before I could get the keys that I would be registered as the owner on the new land registry system - without the original this cannot happen.

The sellers solicitor will not provide an undertaken letter saying the mortgage has been paid off, and my solicitor will not try to get the undertaking either.

I do not know what to do in this situation, I have paid my home insurance in full for the year. My own mortgage repayments are due to start coming out soon, my rent is coming out also, and there is no timeline as to when this will be fixed.

I have signed contracts, but seller hasn't, because my solicitor will not allow it. My solicitor has gotten my transfer back from the sellers solicitor. Did my solicitor know about this all along? He said he only found out on the closing searches.

Any advice appreciated.

 

[cremeegg]

It sounds like you had a lucky escape.

I don’t think your mortgage will have been drawn down, so you shouldn’t have to make payments in it.

Look for another property.

 

[NoRegretsCoyote]

Can EBS not just supply a new letter? This kind of thing is pretty standard for mortgage providers.

They haven't gone bust, they were just taken over by AIB in 2011 and still exist as a standalone brand.

 

[Monbretia]

Agree with above, if it is really paid off there should be no difficulty getting a letter from EBS, they still exist.

But I do think your new mortgage will have been drawn down as the solicitor would have to have had the funds ready on the closing day. Solicitor needs to return funds to your bank pending sorting this or you will end up paying the monthly repayments.

 

[skrooge]

This sounds like a very frustrating situation. Housing transactions can be long drawn out process which can get emotions running high. Sellers are probably feeling the same as yourself. Now is a time for level heads and calm discussions. Don't lose sight of the fact your solicitor is on your side. If the vendor has not signed the contract I doubt the mortgage has been drawn down but no harm checking with your solicitor. There is probably a bit of brinkmanship going on here. See what their solicitor comes back with. If no joy contact the estate agent and explain the situation. It might be the vendors solicitor doesn't want the hastle of extra work. The sellers may be unaware of all this. The estate agent can be a useful go-between in this situation. They want the sale so at this stage are on your side and can help explain the issue to the seller.

Your solicitors request is reasonable. No mortgage provider will want to be second in the pecking order in terms of claim on the property. The onus is on the sellers to satisfy your solicitor (but ultimately your mortgage provider) that there are no issues. If they want to sell they will have to prove the asset is unencumbered.

Don't write off the house yet but make sure you're not paying for something that isn't yours.

 

[emrk123]

It sounds like you had a lucky escape.

I don’t think your mortgage will have been drawn down, so you shouldn’t have to make payments in it.

Look for another property.

Hi there, it had been drawn-down, but I got better news today, hopefully it will be all sorted soon

 

[emrk123]

Can EBS not just supply a new letter? This kind of thing is pretty standard for mortgage providers.

They haven't gone bust, they were just taken over by AIB in 2011 and still exist as a standalone brand.

Thank you for the information, it gave me some hope today!

Agree with above, if it is really paid off there should be no difficulty getting a letter from EBS, they still exist.

But I do think your new mortgage will have been drawn down as the solicitor would have to have had the funds ready on the closing day. Solicitor needs to return funds to your bank pending sorting this or you will end up paying the monthly repayments.

Yes it had been, my solicitor today actually only heard back from the bank about returning funds, but he's asking can he hold onto them now as its looking better again to avoid more delays of sending back and requesting immediately again. The seller's solicitor has finally agreed to do the undertaking to avoid more delays of sending back and requesting immediately again.

This sounds like a very frustrating situation. Housing transactions can be long drawn out process which can get emotions running high. Sellers are probably feeling the same as yourself. Now is a time for level heads and calm discussions. Don't lose sight of the fact your solicitor is on your side. If the vendor has not signed the contract I doubt the mortgage has been drawn down but no harm checking with your solicitor. There is probably a bit of brinkmanship going on here. See what their solicitor comes back with. If no joy contact the estate agent and explain the situation. It might be the vendors solicitor doesn't want the hastle of extra work. The sellers may be unaware of all this. The estate agent can be a useful go-between in this situation. They want the sale so at this stage are on your side and can help explain the issue to the seller.

Your solicitors request is reasonable. No mortgage provider will want to be second in the pecking order in terms of claim on the property. The onus is on the sellers to satisfy your solicitor (but ultimately your mortgage provider) that there are no issues. If they want to sell they will have to prove the asset is unencumbered.

Don't write off the house yet but make sure you're not paying for something that isn't yours.

It was extremely frustrating, I was very upset at the time, it was definitely as you put it a highly emotional time for all of us (seller clients included) I took your advice and contacted the estate agent, now following this it looks like it will close this week as the seller's solicitor has finally agreed to do the undertaking, thank god I won't be liable for the two mortgages! I just hope nothing else comes up in the next closing searches that all will be fine.

Thank you all for your advice/input