Answer: It is unfortunate when a seller of a property behaves in this way. However, I’m afraid there is very little that can be done about it because there is no binding contract until exchange of contracts and so you and your seller are each entitled to change the terms of the agreement and/or withdraw from the transaction at any stage prior to exchange of contracts without penalty. Such behaviour will usually result in wasted costs for both parties.
If you still want the house and decide to pay the increased price, you must also inform any lender from whom you have a mortgage offer as the mortgage offer will require amendment to reflect the new price.
Indeed, if you need to borrow more money from your lender to pay for the increase in price, this may cause you delays as your lender will want to consider the new loan to value ratio and indeed whether your personal finances can sustain a larger mortgage.
Your lawyer should ensure that the sister signs the contract to confirm that she will vacate the property prior to or on the completion date and to acknowledge that she accepts she has no occupancy rights.
If you would ideally like to complete earlier, use the fact that you are paying a higher price as a bargaining tool.
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Fiona is a partner in the residential real estate team at Thring LLP (www.thrings.com).
These answers can only be a very brief commentary on the issues raised and should not be relied on as legal advice. No liability is accepted for such reliance. If you have similar issues, you should obtain advice from a solicitor.