Student, 24yr, loses $60k deposit on apartment

Forums › Off topic › Student, 24yr, loses $60k deposit on apartment

FineWine

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#254315 6-Aug-2019 16:13

Sugartree apartment buyer decries $60k deposit loss, developer says 'hard lesson to learn'

"Not only would the $60,000 be legally retained, but Campbell was now liable for full and final settlement, he said, because she had agreed to that in a written contract."

Sorry but READ the small print and engage a lawyer BEFORE signing.

'Sadly, the agent was my mum' - Sugartree unit buyer lost $60K deposit, can't settle purchase

"She did not warn me whatsoever about the difficulties I might face getting finance," Campbell complained about her mother.

Oh dear - Blood not as thick as water - so sad really.

Now she has the cheek to start a 'Give-a-Little' page

'Mum sold me unit I couldn't afford' student seeks help, advertises Sugartree apartment

Life lesson learnt move on. Take responsibility for YOUR life.

No sympathy here.

Whilst the difficult we can do immediately, the impossible takes a bit longer. However, miracles you will have to wait for.

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#2291035 6-Aug-2019 16:18

Better yet, She did consult a lawyer and ignored their advice.

"My agent stated that I was to simply ignore the advice given by my lawyer to have a meeting with a bank. She was aware that I was in no position to obtain finance as I am currently studying, and this would jeopardise her sale," Campbell said.

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alasta

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#2291039 6-Aug-2019 16:23

It doesn't say why she can't get finance but I would guess that it would be because banks don't want to lend on an apartment that small, and the fact that her mortgage would be $540k which could quite possibly be ten times her income.

This is one of the risks of buying off the plans. You usually can't get a pre-approval from a bank more than 90 days from settlement, and off-the-plans purchases are typically at least two years in advance of completion. If you don't have at least a 25% deposit, or would need to borrow more than three or four times your income, then you can't assume that you will be a mortgage approved when the time comes.

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#2291041 6-Aug-2019 16:24

I was an idiot at that age (some say I still am) but even I wouldn't have put down any deposit on a place without ensuring I had secured financing to settle along with a backup option...

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#2291046 6-Aug-2019 16:34

If I had to take a guess, I reckon mum and her cooked it up but failed to read the small print properly.

"buy this apartment, I will get the commission as the agent and then you can on sell it and get your money back plus profit"

...except she had to settle before on-selling and then couldn't get funding and mother-dear left her in the dung.

dt

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#2291048 6-Aug-2019 16:39

she's started a give a little.. can't believe people have already donated a whopping $30

Imagine being reimbursed on every loss you've ever made..

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#2291051 6-Aug-2019 16:41

Has the NZ Herald just become a site for promoting Givealittle causes?

There is absolutely nothing newsworthy about this case, but it has dominated their homepage for two days now.

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#2291052 6-Aug-2019 16:43

dt: she's started a give a little.. can't believe people have already donated a whopping $30 Imagine being reimbursed on every loss you've ever made..

Probably got a few friends to make donations - virtual equivalent of some gold coins planted in the collection hat before you pass it around.

The entitlement and inability to assume personal responsibility being displayed here is particularly galling.

Hope "Give A Little shut" it down pronto.

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#2291059 6-Aug-2019 16:52

What an idiot!! Only one person to blame here

tripp

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#2291062 6-Aug-2019 16:55

*rolls eyes*

Even at 18 you should be smart enough to know to listen to your lawyer more than your mother when buying a house/apartment.

She called into 1 of the radio stations talking about her "issue". Funny thing is as soon as she finished the call the company director of the sales agent called in saying they tried to help her but she demanded that they sell it so she get high profits and when they said they don't think it would get much more than what she has to pay she did the media thing.

The company director even said when she signed she was doing high paid model work so that is why they did not think she would have an issue with settlement 2 years later.

sen8or

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#2291065 6-Aug-2019 16:59

Sympathy level = nil

Suspicious person is suspicious. Mother as agent sees opportunity to make a quick buck, both through the original sale of the property (via commission) and then via onselling with profit. Mother / daughter concocted scheme to split profits. Market goes pear shaped, scheme fails. Mother no where to be found (supposedly) and now "poor innocent daughter" left carrying the can.

I can only hope she isn't a law student of studying for a business degree......

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#2291070 6-Aug-2019 17:09

alasta:

It doesn't say why she can't get finance but I would guess that it would be because banks don't want to lend on an apartment that small, and the fact that her mortgage would be $540k which could quite possibly be ten times her income.

This is one of the risks of buying off the plans. You usually can't get a pre-approval from a bank more than 90 days from settlement, and off-the-plans purchases are typically at least two years in advance of completion. If you don't have at least a 25% deposit, or would need to borrow more than three or four times your income, then you can't assume that you will be a mortgage approved when the time comes.

I'll go out on a limb and guess that its because she has no regular income and can't satisfy the bank's loan to value deposit criteria ( apartment pre commits don't count)

I'm also guessing she has been sold a line of , "just buy on off the plans and then flick it for profit when it comes due".... the problem is you need the title before you can transact it....

What I simply can't believe is that it was her Mum ( who appears to have vanished) who sold it to her.....

The give a little page is going on my "check once a week for a chuckle list"

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#2291073 6-Aug-2019 17:17

what i want to know is how much can you sell apartment for?

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#2291082 6-Aug-2019 17:23

Item: "buy this apartment, I will get the commission as the agent and then you can on sell it and get your money back plus profit"

This is a frequent part of an apartment sales pitch. The buyer probably has a case ; )

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#2291083 6-Aug-2019 17:29

gzt:
Item: "buy this apartment, I will get the commission as the agent and then you can on sell it and get your money back plus profit"

This is a frequent part of an apartment sales pitch. The buyer probably has a case ; )

except that the agent is the mother

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#2291100 6-Aug-2019 17:52

This happened all over the place during what was a slight contraction in the market back in the early '90s.

If the completed apartment had a true market value greater than what she'd contracted to pay, she'd have been able to get short term finance to enable her to flip it. I'd have lent her the cash myself, for a decent cut of the gains.

One could assume from this that the true value of the apartment in the market today is more that $60k less than the contract price.

Heavily leveraged speculators who thought they were on to a sure thing often take big tumbles.

If there's a lesson in this, it's that some heat has come out of the market, and if stories like this become more common, then the construction/developers are going to go for a huge slide.

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