Builders going under?

[Raiden328i]

So this is my wife’s idea and she wants a holiday home and had an offer accepted on a new build flat and paid a reservation fee.

One of the letting agents we might use has said you do realise the builders have gone into receivership last week and this will probably delay the purchase but don’t worry a buyer should be taking over soon?

To me if you’re going into receivership your going under and your not going to complete the project and I’ll lose my money. According to the mortgage company and estate agent this is normal? Am I missing something here

[AlexR]

Builders are feeling the pinch because building materials have risen steeply within the timeframe of a fixed price contract - thus reducing their profit margins. The Estate Agent is bound to try and 'save' the sale and have been known to say things that turn out not to be 100% accurate.

I would be discussing this situation with my solicitor .

[Raiden328i]

https://www.portsmouth.co.uk/busines...dation-3752209

She’s got her heart set on it but I’m not convinced

[Gordon999]

Have you exchange sale contracts ?

[Raiden328i]

No literally on Monday we agreed on the price and just put down a reservation fee of £1000

[loanarranger]

When did you get your mortgage offer, remember that a BtL/ Holiday Home may only be valid for 3 months, a minority 6 months, The valuation is again only valid for six months and whilst a degree of tolerance might be given by the lender for the mortgage offer, there is the risk that if it overran the 3/6 months the mortgage might have to start again and present or future rates apply; certainly after 6 months there will have to be a new valuation undertaken but on a moderated valuation fee basis.

[royw]

Be grateful you only stand to lose £1000,it could have been much worse.