Brisbane academic facing bankruptcy over $448k home bungle

An aspiring homeowner’s plan to purchase a property has gone so horribly wrong that she is now facing bankruptcy.

An aspiring homeowner’s plan to purchase a property has gone so horribly wrong that she is now facing bankruptcy.

EXCLUSIVE

An aspiring homeowner’s plan to purchase a property has gone so horribly wrong that she is now facing bankruptcy.

It’s every Australian’s worst nightmare – what should have ended with her dream home has instead turned into a nightmare that could see her lose everything.

News.com.au has previously reported on Queensland academic Dr Loretta McKinnon missing out on her chance to buy a property after her bank was 13 minutes too late in finalising the settlement.

Negotiations with the vendor have broken down so drastically in the years since that the matter has landed in several courts.

The vendor has now taken steps to recover $448,000 from Dr McKinnon over the failed deal.

Last month, Dr McKinnon received a bankruptcy notice from the vendor, Nancy Lee, sent via a solicitor.

“We attach by way of service a Bankruptcy notice issued by the official receiver … in the sum of $448,562.35,” the notice reads.

“I don't have anywhere to go, I’m stuck waiting for an outcome,” Dr McKinnon lamented to news.com.au.

Dr Loretta McKinnon at her Windsor property which she has been fighting over for more than two years. Picture: Matthew Poon

This picture was taken after Dr McKinnon won the auction, when she had no idea of the nightmare that would follow.

The epidemiology expert was renting a three-bedroom house in the Brisbane suburb of Windsor and made a winning bid of $580,000 for it at auction in 2021.

Dr McKinnon claims her bank, the Commonwealth Bank, was 13 minutes too late to finalise the settlement because an incorrect box had been ticked on the documents.

The seller then refused to grant an extension, allowed under Queensland contract rules at the time, and ended the contract.

Since then, Dr McKinnon has been in several drawn-out legal battles trying to take back the property which she claims is rightfully hers.

She lodged a caveat on the house, which protects her interest as an aspiring buyer, and blocked the vendor from selling to anyone else.

But in October, a court overruled the caveat, allowing the vendor to go ahead and sell it to someone else.

In a separate legal case which Dr McKinnon claims she was not aware of, the vendor sought to have her pay back their losses.

In December, the Brisbane District Court ruled in a default judgment against Dr McKinnon, ordering her to pay $448,562.35 to the vendor, calculated by the loss they have incurred over the debacle.

Dr McKinnon said she plans to appeal the court outcome and she has also since lodged another caveat.

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The home the dispute is over.

Banners at the site of the disputed property.

Dr McKinnon claims the issue at the centre of her curdled dreams is the fact that a 90-day settlement period was originally granted so she could get enough money together to fund the purchase.

However, during this three-month period before settlement, property prices in Windsor boomed, and the house next door sold for $200,000 more than what Dr McKinnon had won the auction with, just two weeks later.

This was during the 2021 housing boom sweeping Australia which saw the national average of property prices jump by 25 per cent.

As a result, Dr McKinnon claims the vendor wanted significantly more for the property and decided to end the contract over her late settlement.

The vendor also still has hold of Dr McKinnon’s $29,000 deposit which she paid more than two years ago to secure her purchase, and some of it came from borrowing funds from her dad.

She does not expect to get it back.

News.com.au has contacted the vendor, Ms Lee, for comment, via her solicitor.

Previously, the vendor’s solicitor pointed out their client was not legally obligated to grant the extension.

A CBA spokesperson said that the bank “was not a party to the proceedings” between Dr McKinnon and Ms Lee.

They added that they had been actively negotiating with Dr McKinnon and the owner of the house to come to a solution.

The spokesperson claimed that Dr McKinnon had not accepted CBA’s offers to resolve the dispute and the completion of the purchase has not been possible.

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Originally published as Brisbane academic facing bankruptcy over $448k home bungle