In recent years the number of distressed properties been sold by Receiver/Liquidator/Mortgagee in Possession on behalf of financial institution has increased exponentially.
Unfortunately for purchasers a practice has emerged whereby many of the standard warranties and representations that a purchaser would expect to receive when buying a property are been diluted by the insertion of numerous special conditions within the Contract for Sale, conditions which would not be found in a standard contract. Example of such conditions include;
- Condition refusing to provide any warranty or representations in respect of the planning history of the property
- Condition refusing to pay any outstanding charges affecting the property (NPPR, LPT, service charges, rates, water rates, financial conditions re planning etc.
- Condition refusing to deal with a Lis Pendens or any proceedings issued between the date of sale and the closing date which affect the property for sale
- Condition excluding the obligation to disclose any notices served by any state or local authority in respect of the property, unless such notices have come to the receiver's actual attention prior to a sale
Although pressure has been exerted by the Conveyancing Committee of the Law Society on the Irish Banking Federation in relation to the practices set out above it is unlikely that anytime soon making the task of purchasing a distressed property even more onerous for purchasers and their advisors.