There might be good reasons why you’re thinking about threatening to pull out of your house purchase, as the sellers may be messing you around and you’re getting fed up. You may also be getting pressure from your buyers, who are equally as stressed and frustrated as you are, so the question remains, should you threaten to pull out of house purchase?
Only threaten to pull out of a house purchase if you mean it, as they may call your bluff and the sellers may put their house back on the market. Having said that, the threat to pull out of house purchase may be enough to kick them into action, especially if the sale is important to them.
Should you pretend you’re going to pull out of house purchase
Pretending you’re going to pull out of house purchase is a bit of a dangerous game, as you may annoy the sellers and they may pull out from the sale. It’s unlikely the vendors will pull out if they are keen to sell their house, but only threaten if you really mean it.
What is effectively putting a gun to the sellers head shouldn’t be done lightly, and it’s not a good game to play by pretending.
Can you threaten to pull out of house purchase?
You can can threaten to walk away from a house purchase at any time prior to exchanged of contracts, but you will lose your conveyancing costs and survey fees spent to the point you walk away. If the sellers are reliant on the sale of their home to buy another property, you have them over a barrel.
How much will I lose if I pull out of house purchase?
If you pull out of house purchase before contracts are exchanged, you’ll lose what you’ve spent on survey and valuation fees, conveyancing costs and search fees. But if you pull out after exchange of contracts you’d break a legally-binding contract, lose your deposit and suffer penalties too.
Is it a good idea to pull out of house purchase
It’s only a good idea to pull out of a house purchase if you’re prepared to begin again looking for another home, and you’re happy to lose what you’ve already spent so far buying this property. The conveyancing process will begin again, and if you have buyers for your home, you may lose them in the process.
If you feel the sellers are messing you around and taking too long, it might be a good idea to begin looking for another property in any event. But be aware that by asking to view properties with the estate agent who sold you the current house you’re trying to buy, they will tell the current sellers, as they are in contract with them.
But before you threaten to pull out, it’s a good idea to find out why the sellers appear to be delaying. There may be good reason for the delays, and it might even be their solicitors who need pressure putting on them. Ask the estate agent for answers, and if necessary, request a meeting with the vendors.
It’s better to ask for an exchange date than to threaten to pull out of house purchase
A better way to get your house purchase moving, without resorting to threatening to pull out, is to ask your solicitor to offer a date for exchange of contracts. Be reasonable with how soon this date is, and allow at least 2-3 weeks ahead, otherwise you may upset the sellers. If this approach doesn’t work, and there’s no exchange date agreement forthcoming, it may be necessary to threaten to pull out after all.
Good reasons when to threaten to pull out of house purchase
If you going to become homeless: If you’re about to become homeless unless the house purchase proceeds on time, this is a good reason to force the purchase. But if you are going to become homeless and the purchase is delayed, you may need to start looking for a contingency plan in any event.
Your buyers are threatening to pull out: If you are able to put the blame on someone else, it is less likely to annoy a seller. If the sellers are keen to sell, they won’t want you to lose your buyers, as this will hold their sale up too.
Loss of mortgage offer: Most mortgage lenders will extend their offer for a few more months, but if they won’t do this, or if they’ve already extended once, you may be nearing when the offer will be withdrawn. If this is the case, you have good reason to push the sellers for a completion date or to threaten to pull out.
Moving to start a new job: It may be you have to move by a certain date because you’re starting a new job. If your new home is a long way from where you currently live, and if the commute is unreasonable, this is a good reason to push the sellers.
Stamp duty deadline: The government have given reduced stamp duty rates and imposed certain deadlines, which makes a difference to the cost of a house purchase. This is a reasonable reason to push sellers into an exchange and completion dated.
Pulling out of a house purchase before exchange UK
If you are considering pulling out of a house purchase before exchange of contracts, you will lose the conveyancing costs spent so far and other buying costs such a survey fees and search fees.
How to pull out of a house purchase UK
If you decide to pull out of a house purchase you need to let the selling estate agent know immediately so they can let the sellers know, but also notify your conveyancing solicitor too, who will confirm this to the vendor’s solicitor and will stop working on your case.
Final thoughts about should you threaten to pull out of house purchase
If you are worried about your mortgage offer expiring, there’s normally no need to, as often times most mortgage lenders will extend the deadline. Speak with the lender, or with your broker if you use a mortgage broker, to see if the deadline for your mortgage can be extended. In most cases, lenders will extend the deadline at no cost to you.
If you are a first time buyer, a cash buyer or living in rented accommodation, and the seller is in a chain, by you threatening to pull out will mean they could lose a strong buyer and their chain and onward house purchase. But for you, this purchase isn’t quite so important, as you have nothing to sell.
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Should You Threaten To Pull Out Of House Purchase
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Article written by Russell Bowyer who has been investing in property since purchasing his first commercial property in the 1990's for his own Chartered Accountancy business. But his first property investment project was to turn an old dilapidated restaurant into a large 5-bed home, which he purchased for £117,500 and sold for £450,000 (to see an "after" photo of the house before it was sold see here: About). Russell owns a number of investment properties, which includes houses, flats and HMO's. More recently he has turned his creative side to investing in property using lease options. His largest lease option deal to date was to acquire 12 properties worth over £2 million for just £12, which means he paid just £1 to acquire each property!
