r/Luxembourg • u/Primary_Bad_3019 • 2d ago
Ask Luxembourg Mortgage timelines
We placed an offer and it was accepted.
The owner gives bank to reply 45 days to give an answer upon application or else we end up paying 10%.
Was curious if this is a common thing?
It feels unusual as we thought that it would take at least several months to get answer from the bank, so we are reaching out to community to understand how this goes
8
u/mondelyoko 2d ago
45 days are more than enough Once you obtain an appointment with the bank and submit your documents, it can take them more or less 1 week to revert back to you
The challenge if there, is to find an appointment with the banks and to do bank shopping, to ensure you get the best offer among all the bank
4
u/randomzy876 2d ago
30 days is the normal term…banks will take 2 weeks-ish to get back to you, they know the game.
4
u/Klegi073 2d ago
Worst case the bank is able to provide you with a document stating that they “are working on your file and that they need XX amount of time to come with a decision”. This should cover you in case you would exceed the 45 days.
Make sure to ask different banks in case the owner requested more than 1 bank response.
3
u/Beginning_Animal9978 2d ago
If you already had conversation with the bank and you got a 'pre-approval' or in-principle approval up to a certain upper limit, this should be quick. If this is the first time ever you are initiating a conversation with the bank, it can take 3-4 weeks easily. Either ways, 45days looks doable.
5
u/charly11292 2d ago
If you have a bank refusal you do not have to pay 10%. 10% is also too high as a penalty. This will never hold up against court.
2
u/LuxDude 2d ago
10% is standard as far as I know, and the option to get out with a bank refusal (a type of “clause suspensive”) is a common condition in these contracts, but it is not mandatory (I hope it is in OP’s contract)
1
u/Primary_Bad_3019 2d ago
Yes if bank refuses we won’t pay but I was scared what if they take their sweet time and somehow pass the 45 days deadline. Owner has no incentive to wait for me, he can sell the apartment all the same to somebody else + 10% from me.
2
u/Italian_Saffa_Boy 2d ago
If the owner is serious to sell, he will wait. I waited a long time for my bank to approve ( over the time ) and the seller was okay with a delay. If the seller refuses to sell, and claims the 10%, if the bank approval is longer than 45 days, I doubt the court will find in his favor. It would seem he entered the selling contract to get 10% fee and no real intent to sell.
1
2
u/post_crooks 2d ago
This will never hold up against court.
On the contrary, it often goes beyond that amount taking into account legal interests, part of the legal fees of the seller, and court fees. If you don't agree with the penalty, you should sign an amount both parties can agree. The penalty can also work in favor of the buyer, and it's usually the same.
3
u/KohliTendulkar 1d ago
10% works both way, if the owner decides he found a better deal or fails to deliver the apartment or house, they are also liable to pay 10%.
2
u/Infamous-Ad7832 2d ago
Yes I had that as a clause too.. 3 refusals or 1 acceptance within 1 month. Penalty was 10% It’s a greedy clause.. better have the paper work with banks going as soon as possible
3
u/journey2theearth 1d ago
45 days is definitely doable especially at this time. I had 30 days during peak period and during holiday season. One bank had said that they would take 6 weeks (and to be honest, I did not want to move to them anyway since I have had terrible things about them- I was just hoping to get a rejection letter from them incase I needed it). You will be fine. Start asap. Your bank will probably be faster.
1
u/Outrageous-Occasion 1d ago
Smart. @ OP: you should only be liable for the 10% if you DONT TRY to get a loan. A rejection letter SHOULD clear you from liability.
2
u/post_crooks 2d ago
45 days is OK, even if you have 3 months, banks will delay their reply to make it more difficult for you to negotiate
2
2d ago
[removed] — view removed comment
1
u/AutoModerator 2d ago
Hi, your Reddit account is not allowed to comment in our community. Low comment karma is not trusted. You are only allowed to post. Until you have a trusted account with enough postive karma to satisfy our Automoderator, please accept the answers you are given. If you have a support-related inquiry, please search the community for similar posts, including the weekly Megathreads which are pinned to the top of our home page. Take the time to learn about being a good Redditor. Consult these resources ( r/NewToReddit | https://www.reddit.com/r/help/| https://support.reddithelp.com/hc/en-us/p/redditor_help_center )
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
1
u/TopSilent9410 2d ago
I’m amazed how it is normalised this greedy owner and then he will get the loan and still need to pay +10% ! Really? Whats the risk owner is taking?
2
u/LuxDude 2d ago
I would agree that 10% is high, but the reason for these provisions is simple, namely to avoid buyers who are not serious and those employing stalling tactics.
3
u/MarcosRamone 2d ago
I am at the buyer's side of things but need to agree with this. These clauses become necessary because people sign contracts before even going to their bank to ask how much they can spend. A conversation that is for free, takes a couple of hours of gathering documents and going there to talk with them, and provides very valuable information towards the house hunting (basically how much you can spend) and a commitment from the bank. All easy and free of charge. All this said, 10% is absolutely excessive for wasting a contract signature and losing two months. But everything has a price ...
15
u/Italian_Saffa_Boy 2d ago
The greed of some homeowners (and agents) match Galacticis and Thanos levels.
I know a person, whose partner died unexpectedly between the loan being approved and signing the final transfer at the notary. They have two small kids. The deceased was the sole income earner.
So as expected, the home owner won't let them cancel the deal, but wants 10% fee. Agent is pushing for 10% fee. Bank won't cancel. So person stuck with a mortgage, 2 small kids ( both under 5) no job in Luxembourg..
Truly a heartless bunch of sods.....