Question:

Exchange bond / Debt management.?

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Two years ago my partner and I exchanged contracts on a new build apartment off plan for £153,000 with the view to rent it out, to do this we used an Exchange Bond which cost us £2000 as a deposit

Since this happened unfortunately I lost my job and we run into money troubles which left us having to go on to debt management as we had £48,000 in loans and credit card. We already have a house that is worth £160,000 which is mortgaged up to £148,000 and also have a loan secured on this for £15,000. I now work and we have been keeping up our mortgage repayments and also our debt management and manage month to month budgeting for essentials.

We instructed our solicitor to pull us out of the sale for the apartment as we knew we could not afford this as well as our current mortgage and also there is no way we would get a second mortgae with us being on debt management. We have received a letter saying now that the builders of the apartments have claimed £15,000 off the exchange bond company and now they need us to reimburse them for this amount. We are worried to death and cannot see anyway out of this mess.

If our house has no equity in it then I am told that this is safe however we are not sure what to do for the best.

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  1. Unfortunately once you've exchanged contracts thatis when you are legally obliged to complete.  I would contatct a conveyancing or civil litigation solicitor who would have extensive knowledge of the implications.  Hope this helps.

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