seller delayed settlement

Hi All,

My contract went unconditional in QLD and the settlement was supposed to be on 07-Feb and just on the day of settlement seller applied for a week's extension. I gave the extension and now again just one day before the settlement seller is asking for one more week's extension. I spoke to seller and asked what is going on and the reason given is weird. Seller's bank is not discharging mortgage because it thinks we (buyer and selller) are doing some kind of dodgy deal to save tax. seller's Bank thinks house is worth $520,000 and the price I am paying for the house is $415,000 is too low". Bank has done the valuation and it came back in 500ks and they want to do another valuation. Have you guys had any drama like this and what is your advise in this case. The property is in Gladstone where the prices have gone down considerably. Had it been 2011-2012 the house could have been sold in the range $of 500-520k but not now.
 
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It appears the seller's lender isn't recovering enough funds from the sale to discharge the mortgage to your lender.

Refer your solicitor.

pinkboy
 
This doesn't make sense. A bank doesn't do a valuation on a property that you sell, just on the ones remaining. Unless the bank is the seller - mortgagee in possession. But, if you have a valid contract then there may not be much that they can do.

Sounds like the seller may have realised that he has sold it too low and he is hoping you will pull out. Speak to your lawyer asap.
 
Sorry to piggy back on this post but Im having a similar situation, but in my case, settlement has already been delayed for 4 weeks.

Not that I'm desperate to settle since it's an ip but it's annoying.

Same reason - vendor x-coll'd and bank needs to do valuation on their other properties and reissue loans.

Does it really take that long to reval and reissue loans?

Property is in Queensland.
 
Yes, it can take ages as some people don't know and so only find out when the discharge of mortgage is sent me a few weeks - or even a week before settlement. This may trigger the bank to ask the person for a new application, then valuation, approval (maybe) then documents prepared, issued, signed sent back and then around 10 days to settlement.
 
I would expect vendors to know better, esp in Queensland where the buyer can sue for damages if not settled by agreed date.

Another question tho - my loan docs were issued and signed just before Xmas, would they expire? I'm using CBA @ 80% lend
 
Ours with Westpac expired 3 months after we signed and we had to do a whole new application. Thankfully they were very quick and we got settlement done a few days later.
 
I would expect vendors to know better, esp in Queensland where the buyer can sue for damages if not settled by agreed date.

Well real estate contracts always favour vendors. A buyer can't charge penalty interest which is the big cost for being late.
 
I received a call from my solicitor today - other side delayed settlement by a week. I suppose I can't complain, I asked and received an extension initially.
 
If it is a standard Qld contract (see below), you can sue for damages. But if they can't complete the contract, you could say they may not have funds to chase anyway!

Cheers.

9.3 If Buyer Affirms
If the Buyer affirms this contract under clause 9.1, it may sue the Seller for:
(1) damages;
(2) specific performance; or
(3) damages and specific performance.
 
If it is a standard Qld contract (see below), you can sue for damages.

Damages for a buyer? Reliance damages at best which are small money. The big amount is expectation damages which is only available to a seller (I expected to get $XX for my sale).
 
Hi All,

My contract went unconditional in QLD and the settlement was supposed to be on 07-Feb and just on the day of settlement seller applied for a week's extension. I gave the extension and now again just one day before the settlement seller is asking for one more week's extension. I spoke to seller and asked what is going on and the reason given is weird. Seller's bank is not discharging mortgage because it thinks we (buyer and selller) are doing some kind of dodgy deal to save tax. seller's Bank thinks house is worth $520,000 and the price I am paying for the house is $415,000 is too low". Bank has done the valuation and it came back in 500ks and they want to do another valuation. Have you guys had any drama like this and what is your advise in this case. The property is in Gladstone where the prices have gone down considerably. Had it been 2011-2012 the house could have been sold in the range $of 500-520k but not now.

More update - just been advised that the vendor's bank had to do valuation on the x-coll'd property as the one I am buying.
I dont understand why tho, since it's not even a mortgagee sale.
 
This happened to us yesterday - solicitor called and said other side have requested a 3 week delay for settlement. Ordinarily I wouldn't care but settlement was (/is) today and we have tenants moving in on Saturday. Asked the solicitor what the deal was in that situation and she came back and informed me that they can now settle, which happened at 2pm today. This is our first property in Brisbane.

Never got an answer as to what happens if we have a signed lease and settlement is delayed though?
 
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