Buyers can't complete purchase contract in time

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This topic contains 1 reply, has 2 voices, and was last updated by Profile photo of Perrypower1 Perrypower1 2 years, 3 months ago.

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  • #182825
    Profile photo of elaine
    elaine
    Participant

    We’re selling our frontline beach penthouse on the costa blanca. Last August we signed a contracto de compraventa/señal with our buyers and received a 12,000euro deposit to hold the property for them for 13months to give them time to sell their house in France. The contract is valid till 30th September 2014.

    Last March they sent us an email informing us they had accepted an offer on their house.

    Last May the buyers sent us and our agent an email saying they want to extend the contract till January31st 2015, as their buyers can’t complete till December 2014.

    We told our agent to inform them that we much prefer to complete before 30th Sep 2014, as agreed in our contract. Shortly after this our agent told us that our buyers will be coming to Spain in August for a holiday and to arrange bridging finance. Last week the buyers visited us. They told us again that they cannot complete by 30th Sep. They say they cannot get finance from a spanish bank because they are non-residents , when asked they said they cannot ask their buyers to get bridging finance therefore enabling them to keep our contract, as their buyers are paying cash (I don’t know what that has to do with it!) They said that they could give us a further deposit of 3,000 euros for us to extend the contract for the time from 30thSep till 31January. We told them we need to think about it.

    We don’t feel inclined to offer them an extension to our contract, considering they haven’t respected our present one!

    We would like to put our penthouse back on the market. I understand on 1st October 2014 they will have forfeited their deposit to us, because it is through their error that the contract wasn’t fulfilled, and we don’t agree to sign another contract with them. My question is, we know now, and have it in writing, that as of today’s date they are unable to fulfill our contract, so can I put our flat back on the market now, before 30th September, without running the risk of us breaking the contract? Of course, we would tell anyone interested that to buy they must wait till 1st October (if we get a buyer so quickly) I would just like to cover our backs and get on with the sale of our penthouse.

     

    Also, maybe when our buyers hear that we are putting the house back on the market and they will be forfeiting their deposit, they might be more motivated to get their finances in order to complete before the contract runs out! We were also thinking of offering them  the option that even though the contract specifies they have forfeited their deposit by not completing in time, after the contract runs out we would still honor their deposit if they complete before any other buyer does. But if another buyer completes before them, they’ve lost their 12grand.

    Thanks for any input on this…

     

     

     

  • #182828
    Profile photo of Perrypower1
    Perrypower1
    Participant

    You don’t tell us the full purchase price so it is difficult to determine whether the deposit represents a small or large proportion of the transaction.

    The buyer has until 01 October 2014 to complete the sale. If you start to market the apartment now they could argue you had no intention of completing the sale.  They may not be successful in their claim but there is room to argue the point in law.  If you entered into an agreement for sale prior to 01 October then the old buyer could make a claim for twice their deposit back.  If you sold the apartment as a result of marketing prior to 01  October they could attempt to claim the same damages.   Basically you cannot act prior to the contract  being breached without risking tainting the whole transaction.

    While it is frustrating to have the the transaction dragged out, the offer of an increase deposit is in your favour.  If it was me I would also ask for damages equivalent to the rental value of the property for four months.

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