Buying a house in negative equity

Sun in Capri

Has anyone managed to buy a house in negative equity where the vendors bank has to consent to the sale?

The vendors bank is saying that the procedure is that they will only give its consent once the contract has been signed by the purchaser and full deposit paid. There would be a special condition in the contract protecting the deposit if the bank does not consent to the sale.

I will seek legal advice. For now I am wondering if anyone has gone through all the red tape and managed to buy a property where the vendor needed their bank's consent.

alias no.9

Sun in Capri wrote: »

Has anyone managed to buy a house in negative equity where the vendors bank has to consent to the sale?

The vendors bank is saying that the procedure is that they will only give its consent once the contract has been signed by the purchaser and full deposit paid. There would be a special condition in the contract protecting the deposit if the bank does not consent to the sale.

I will seek legal advice. For now I am wondering if anyone has gone through all the red tape and managed to buy a property where the vendor needed their bank's consent.

Yes, we've been through it two years ago, things move very slowly. Your solicitor will be doing most of the work.

Sun in Capri

Thank alias. How long did you have to wait after paying deposit?

TheDriver

I would run run run. There's a big thread on I somewhere but that's strange, I think you are being told fibs. Mire like the vendor wants a sale guaranteed to get leverage to negotiate the debt. That contract would have no end date and keep you hanging for ages. Consent first, talk after

Sun in Capri

Thanks Driver. The vendors solicitor told the EA the procedure I mentioned above. I am extremely wary about it and am seriously considering running as you suggest.

gmisk

Sun in Capri wrote: »

Thanks Driver. The vendors solicitor told the EA the procedure I mentioned above. I am extremely wary about it and am seriously considering running as you suggest.

Good advice from people here.
Read the other very long thread here, from my own experience run a mile!

Woshy

http://www.boards.ie/vbulletin/showthread.php?t=2057011064&page=13

That's the long thread about people buying houses in negative equity. I read it before house hunting and it meant that when we were looking I was extra vigilant about finding out if houses were in negative equity. Personally, I'd run a mile in your situation.

crisco10

Funny, I just bought a house requiring this consent. 2.5 months from sale agreed to getting keys.

In my case, the vendor was keen to offload their second property so had everything reasonably lined up ready to go.

TheDriver

crisco10 wrote: »

the vendor was keen to offload their second property so had everything reasonably lined up ready to go.

That's the unusual part, most don't have any consent even tho we are told they do, as has luckily been the case in your situation.

Sun in Capri

OP here - yes the Vendor in this case has not got their banks consent and to find out what the procedure would be took 6 weeks. I will have a look at the thread mentioned above. I am going to withdraw my offer on this house as I feel I would be looking for trouble. You would have to wonder at Estate Agents who put houses up for sale on behalf of a vendor who has no consent to sell the house.

Uno my Uno.

TheDriver wrote: »

I would run run run. There's a big thread on I somewhere but that's strange, I think you are being told fibs. Mire like the vendor wants a sale guaranteed to get leverage to negotiate the debt. That contract would have no end date and keep you hanging for ages. Consent first, talk after

Usually the Bank will give consent in principle to the seller before the contracts are signed but will only give formal written consent after contracts have been signed once all the costs and deductions have been figured out and a final figure established.

So there is nothing unusual in the situation the OP is in but it is designed to protect the Bank and is what suits them best from a security point of view. The biggest concern is how long it may take to get consent from the Bank, if the vendor has been talking to the Bank and reached an agreement such as the Bank will consent to sale at the asking price for example it may not take too long, a few months perhaps. If the bank aren't aware of the proposed or the Vendor drags their feet at all then it could take a very long time. Consult your solicitor and get their opinion.

campingcarist

In my case, the vendor had everything worked out and agreed with the bank. He knew how much he had to pay the bank on top of what he got for the property.

However, it seems that the majority of home owner vendors do not know the process for selling and haven't got any agreement from the mortgage company.

Saw a house the other day and the owner said to me that he wanted to sell two of his properties but the bank was holding up the proceedings.

Where there is a repossession, it seems the banks are holding out for house prices to rise. I spoke to an EA today about a property they were advertizing and was told that the receiver and banks had put a hold on the sale (as with other properties in the estate) until further notice. BUT, they insist that the advert remains on daft.ie. In my opinion there should be a law preventing someone advertizing when in fact the property is not currently for sale.

alias no.9

Sun in Capri wrote: »

Thank alias. How long did you have to wait after paying deposit?

Sale agreed in early March, contracts signed mid April, closed end of July

castle2012

Hi there where just in the process of buying a house in negative equity. For me, we where the highest bitter early Dec 2014. But estate agent would not take the deposit till the letter of consent came from bank . We got to put our deposit down at the end of Jan . Where getting our keys the first week in May. So it does need a bit of patience and time I'm afraid.