# Promessa deposit.



## Mr.Blueskies (Feb 24, 2009)

Hi all,

Can anyone tell me what is the correct procedure when one signs a
promessa and hands over their 10% deposit ? Some folk are saying that the
lawyer keeps the deposit in his client account until the deed signing has taken
place.

Others, have told me the exact opposite and that it is normal for the
lawyer to pass the deposit to the vendor at the promessa ??? Now if it is ok for
the lawyer to do this, what happens if the vendor next fails to complete ?
Surely your deposit could now be irrecoverable ?


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## silvers (Sep 22, 2008)

In my understanding the money goes to the vendor. If he then defaults and backs away from the sale, he is liable to refund you twice the amount back, if you back away, you lose the deposit. Bearing in mind he has a house for sale, he obviously has collateral. In the worst case, after court proceedings, which he would definitely lose, you would still get the money after the eventual sale of the house, if you no longer wanted it.


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## Mr.Blueskies (Feb 24, 2009)

Hi Silvers,

Thank you for your reply. Unfortunately, the situation that I have
got into seems to be more complex. Although I have agreed to pay the full
asking price, it has now come to light that the vendor has two mortgages on
this property. The price that I am paying is not sufficient for him to lift these
two mortgages. He is also trying to get a new line of credit to enable him to
achieve this and he also expects the bank to give him sufficient funds to
purchase a house in the Algarve. 

I am beginning to feel that he has been just stringing me along for
months now. I have had the money to complete since the beginning of June.
At this time he said that he just needed a few days to finalise things with his
bank. He has since given me two seperate dates for the signing which he has
both cancelled on some pretence that his bank is still not ready yet.

The problem is that I am in a rented house that I have to vacate at
the end of the month. There is also work that needs doing on the house that
I am purchasing. I had expected this work to be long finished by now, 
but everything is now totally messed up. I also have some items of furniture
stored at this house and more stuff that I have purchased is awaiting delivery.

I now believe that he has just used me to get a promessa 
agreement so that he could next go to the bank and use this to finance a new
line of credit. I believe that this has been rejected by the bank and this is the
reason why he is stalling for time. To make matters worse, he had yet to 
move his own stuff out and he asked me for the keys back two weeks ago so
that he could do so. Now I cannot gain access to deliver more stuff or to 
remove what I have already left there. The whole thing is a total mess.


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## silvers (Sep 22, 2008)

Lawyer time!


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## Mr.Blueskies (Feb 24, 2009)

I found this house myself and an estate agent that I felt was ok (I 
don't know now) I asked this guy to locate the vendor and talk to him about this
house which he did. After agreeing on a price, he next recommended a lawyer to
me. The deal we reached was this. The agent would receive a fee of 3% of the
purchase price. The vendor agreed that he would receive 97% of the asking 
price and that I would pay the agents 3%. The agent requested half of the fee
at the promessa and the balance at the signing. So he has got half already.

The lawyer also made three very strange requests. She also said that
it was normal for half of her fee to be paid at the promessa, so she has also had
that. Next and about one week after she informed me of the signing date (which
was later cancelled) she requested that I foward to her client account the costs
that were needed for the purchase, the balance of her fee and the FULL balance
outstanding on the sale price which she said that she would pay to the vendor
immediately at the signing. I thought that this was an odd request considering
that I am living here full time already.

Thankfully, I did not send her this or they would have had the lot.
Perhaps the whole affair is a set up, or am I just being paranoid now. ????


It does seem to me that it is a very very bad risk to send someone
the entire price of a house just on goodwill alone ? They could not only rip off
the lot but there is also nothing to stop them from moving your money about.
This could be done to get a new line of credit for a dodgy vendor who is skint.
Could this be the real reason why they sometimes make this request ???
I would like to know Omostra 06s opinion on this whole affair, because he does
seem to be very well versed in this whole area.


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## omostra06 (Sep 11, 2007)

in my experiance, if everyone, lawyer, estate agent etc, want 50% at the promessa, which is not normal, they might know something you dont about the property or the owner....

this way if/when it all goes wrong they have all been paid, even if the sale does not complete!

normally the lawyer and agent will wait until after a completion to get paid, this sounds like they were not expecting this sale to ge through! 

and i think you have now become aware of this reason, mortgages will not be removed unless he pays them off on the day you buy, watch out that you dont buy a property and inherit the debt of 2 mortgages along with it.


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## Mr.Blueskies (Feb 24, 2009)

Hi Omostra 06,

Thank you for your reply. What I cannot get my head around
though, is that this agent and lawyer have both been engaged by me (and
supposedly to look after MY best interests) the vendor turned up at the 
promessa with no legal representation ? If they both knew something that I
did not know from the beginning, surely it was their duty to inform me of this 
and not instead to deliberately set out to waste six months of my time, deceive
me and also rip me off ?

What could they hope to achieve from this if they knew that 
this guy would be unable to complete ??? Was it their combined goal to get
me to send the full balance of the purchase price and so take me for 
everything? What redress do I have now if this guy fails to complete. Legally
I am entitled to have double my deposit back, surely along with the purchase
costs that I have sent along with BOTH of their fees which they would have
both received by deception. Is this a matter for the G.N.R. ?

"Is there NO law in this country ????


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## silvers (Sep 22, 2008)

Call another lawyer. Try this guy.
mobile 91 345 32 60
work 262 180 232
work fax 262 180 233

home [email protected]

home Rua Frei Fortunato, No 31, 1st
2460-085 Alcobaca
Portugal


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## omostra06 (Sep 11, 2007)

its not unheard of for lawyers and agents to try to take advantage of people, there are good guys and bad guys everywhere,

it is suspitious that they made sure that they got paid upfront, this is a bad sign that at least they think the sale will not go through, but are insuring that they get paid at least some of the fee.

if the seller fails to complete his part of the contract, you are intitled to double the deposit back, you will of course have to fight for this in court, they dont just hand over the money when you ask, and if this guy is already in a financial mess, what are the chances of ever getting paid out,

this double deposit also has another side to the law that not many people are aware of, the law states that they either give you double deposit or they complete the deal, by this it means sell you the house, so they are forced by law to one of the two options, pay up or sell. you can force the owner tosell you the house, if they have no money and are unable to pay, then they will probably just sell you the house, what will happen at this point if you win this court case, is that the banks who right now have claim to the property might try to claim the house to cover the outstanding debt.

At the start your lawyer should have informed you of the debt on the property and the amount owing, before you choose to sign and pay a deposit.

if you feel your agent or lawyer have not acted correctly in your best interest then you can complain to the governing bodies for both, they are by law forced to have insurance that covers problems like this and can be claimed on to pay you back your deposit if it all goes wrong.

it could also be that there is nothing at all wrong and the sale will go through but as silvers says above get another lawyer to check for you, a few hundred spent now might save a lot more stress and money later.


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## PETERFC (Apr 3, 2009)

*Reply*

Hi Mr.Blueskies

I hope that everything works out as you would wish it to. Sorry i am not in any position to offer advice although i have problems myself but not of the kind to offer advice. 

Peter the 666 man


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## Mr.Blueskies (Feb 24, 2009)

Thanks guys for your opinions and advice. I have just got another
message from my lawyer and she is now giving me a THIRD signing date. :rolleye
I suppose that I just need to sit this one out and take it to it's final conclusion.

It is ridiculous though, that a guy who is basically skint and up
to his neck in debt, can keep a cash buyer during a property crash and recession
hanging about for months ?


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