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Estate agent requesting Proof of deposit/ mortgage agreement before offer accepted

Hi

We are first time buyers and looking to make our first offer on a house. I called up the estate agent this morning to make the offer and they told me that they would need us to send in proof of deposit and evidence of our agreement in principle before they made the offer to the sellers. Is this common practice? I thought you would only need that after the offer was accepted - I can provide it but cautious about showing that information to the estate agent/ seller now and having them decline our offer because they think they can get more money from us.

Thanks in advance for any advice!
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Comments

  • Seems strange that the EA is asking for this unless they have been messed about by lots of people in which case drafting an email together with a screenshot showing the money in the account is not hard to do if you wish to be taken seriously.
  • In my (very limited) experience it seems to vary from EA to EA. May also depend upon the vendor.

    Nationwide will do you an online AIP in minutes. Can you move money around in accounts so you have one with the precise amount required for the deposit? You could use that and a nationwide AIP for precisely what you need to give them the evidence you can afford the offer without having to reveal how much higher you could go.
  • PThome
    PThome Posts: 46 Forumite
    It happened to me exactly the same few months ago when we where looking for our first house. I have the same opinion as you, I didn't want to give this information to the EA. So I spoke with my mortgage adviser and she agreed that they should't ask this information. So she called them and spoke to them confirming that she have seen the proof of deposit and wrote an email confirming that we have the deposit and she was confident that we wouldn't have any problem getting a mortgage. So they accepted this has proof :) and the best part was our offer was accepted (even not being the best one!) :D

    Good luck!!
  • From the other side of the coin I understand why the EA and the vendor want the information... having a FTB pull out from buying our house two weeks down the line after offering when they discover they can't afford to get a mortgage after all, it proves that the affordability is there. I'd certainly be more cautious next time.
  • hjd
    hjd Posts: 1,214
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    My son has just bought his first flat and was faced with the same request.
    We just let the solicitors have evidence of the money/mortgage and she confirmed it directly with the agent.
  • eddddy
    eddddy Posts: 16,245
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    As you suggest, it would be more usual for the EA to want to see this after an offer is accepted.


    But I can also see that if the EA calls the vendor and says

    "Muffle123 has offered £X, they're a FTB, we've seen evidence of their deposit, and we've seen their AIP - so they look like really strong proceedable buyers"

    ... it might make the vendor slightly more likely to accept your offer. But who knows?
  • Thanks for the replies. I understand that they want to have confidence we won't pull out. I have the AiP from our bank so could provide that. The deposit is more tricky to get proof of within the next day as its in a few different accounts. It is a large amount as we have inherited money we are using for part of the deposit but some of that wont be in our account for another couple of weeks - the rest comes from our savings in a few different accounts. We will certainly have it in plenty of time to pay if the offer is accepted but it makes it harder to evidence now! We also don't have a solicitor yet - we have one lined up but haven't instructed them to act officially for us yet as we thought we wouldn't need them until after an offer has been accepted.

    We really like the property and don't want to miss out on our offer being put forward to the seller but as its our first time we want to make sure we are doing things correctly.
  • :wave:

    We had similar but from the other side of things ... after a really enthusiastic buyer viewed our house twice, the EA phoned us to say there was 'an offer in progress' but they were not going to put anything forwards until they'd checked the finances of the buyers. I thought this was because they are cash buyers ... the EA didn't even tell us what the offer was until they had this information!

    Since accepting their offer, when making offers for our own purchase I've fully expected to be asked to provide similar information (as we're going to buy with our equity and not get a mortgage). However, of the two different agents we've made offers through (one purchase fell through very quickly) neither have asked for any financial verification, only checked with our EA that we have a buyer and are in a position to proceed.

    So there certainly seems to be no hard and fast rules, just each EA to their own. I'd certainly proceed in the way suggested of getting solicitor or mortgage co to verify your finances, I wouldn't be revealing all to the EA!

    :) Good luck with it all! PN x
    £1000 Emergency fund challenge #236 - £ 5 / £332.05 + 365 day penny challenge - £ 18.15 / £667.95; 52 weeks challenge = £183 / £1,378;Frugal Living 2018 #42 <£11,500
    :p
  • cloo
    cloo Posts: 1,291
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    It's not standard practice but it's fairly common - I think more people are failing to secure mortgages than used to be the case, even when they look good on paper, which is why agents check. It's happened to some people I know, even at offer stage, although more usually after acceptance.
  • As the above have said, it is quite common now to make sure you can afford what you are offering to save people wasting their time.


    You could always ask the bank or your solicitor to write something up confirming you can afford what you are offering instead of giving full information of how much you are able to get?
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