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Trading up and fall-trough scenario

GalwayBmw · 2020-03-14 19:08:48

You are trading up, selling a cheaper property for 100K, and buying a more expensive one for 200K. You are dependent on the funds generated by the sale. You sign contracts with the buyer and seller, after which you become legally bound and have to pay 10% of the purchase price if you pull out, same applies to the buyer. If…

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14-03-2020 8:08pm

#1

GalwayBmw

Registered Users Posts: 91 ✭✭

Join Date: March 2015

Posts: 71

You are trading up, selling a cheaper property for 100K, and buying a more expensive one for 200K. You are dependent on the funds generated by the sale.

You sign contracts with the buyer and seller, after which you become legally bound and have to pay 10% of the purchase price if you pull out, same applies to the buyer. If the sale falls though because of your buyer pulls out (i.e. this isn't your fault by any means) you end up with -10K balance (20K have to be payed to the seller, 10K the buyer's deposit).

I heard the situation is rare but the money is involved and we need to understand how to deal with this. Is trader-up always exposed and it's just an acceptable risk for them?

Can breakage fees be mutually suspended or how to minimize the risks otherwise.

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