A senior financier has lost a deposit of £500,000 after having to walk away from a deal to buy a £3.25m north London property because of the credit crunch.
He had exchanged contracts earlier this year to secure the house, but could not complete the purchase after he and his wife failed to receive expected pay bonuses.
I hate it when a plan doesn’t come together. Chickens, hatched… natch.
In a separate deal in Chelsea, west London, a buyer is said to have forfeited a £1m deposit when he failed to complete the acquisition of a £12.75m, seven-bedroom home.
Oh my. There appears to be a spate of these failures. Is it systemic?
The banker who has forfeited £500,000 is a managing director of a City investment firm. He said this weekend: “There is no way I can complete the transaction. I did not realise the market would collapse when I made the exchange.”
When a friggin’ banker doesn’t recognize a bubble collapsing, what do the rest of us rely upon? The groundhog?
Pulling out of completion after exchange is a breach of contract. If the seller loses money because the property value falls before another buyer can be found, they may be able to sue the original buyer.
The banker’s lawyer, Simon Thomas, a senior partner at Thomas Legal Group, said: “They are resigned to losing the £500,000 but the seller wants to pursue them for every penny they’re got.
Of course they will. Show them no mercy! Nevermind what this house is not “worth” anymore- it was an inflated value to begin with. But, a deal’s a deal.
Man, law UK-style can be a short-scorcher.
And if you thought we had a bubble here in the US, it pales incomparison to the Brits.