Estate agents' hard sell on mortgages etc..

Senior_Paper_Monitor

The repsonses above are accurate and excellent advice ...

It may be of assistance if I post (not for the first time) the content of document we provide to any of our clients who bring this issue to our attention:

We regularly have clients advise us that the estate agents for the property are ‘pressurising’ that “unless you use their broker you may not be able to get the property”- we have no problem with you seeing anyone you wish, BUT it is not legal to ‘make you do so’, nor to indicate that it will ‘impact on your ability to buy the property ifyou do not’.

Additionally, extra ‘credit checks’ / ‘Decisions in Principal’ may adversely affect your credit rating:

You may find the following extract useful:

Extract from The Property Ombudsman Code of Practice for Residential Sales (as of 22.02.10)

· as recognized by the National Association of Estate Agents (NAEA)

· as approved by the Office of Fair Trading under its Consumer Codes and Approval Scheme


6. Submission of Offers

6a By law, you must tellsellers as soon as it is reasonablypossible about all offers that you receive at any time until contracts have been exchanged (in Scotland, missives have been concluded) unless the offer is an amount or type which the seller has specifically instructed you, in writing, not to pass on. You must confirm each offer in writing to the seller, and to the buyer who made it, within two working days.

6b You must keep written or computerised record of all offers your receive – including the date and time of such offers – and the seller’s response. Such records should be made promptly.

Discrimination

6c By law you must not discriminate, or threaten to discriminate, against a prospective buyer of the seller’s property because that person declines to accept that you will (directly or indirectly) provide services to them. Discrimination includes – but is not limited to – the following:

· Failing to tell the seller of an offer to buy the property.

· Telling the seller of an offer less quickly than other offers you have received.

· Misrepresenting the nature of the offer or that of rival offers.

· Giving details of properties for sale first to those who have indicated they are prepared to let you provide services to them.

· Making it a condition that the person wanting to buy the property must use any other service provided byyou or anyone else.

betmunch

SPM - Brilliant.

moneysavingplumber

Thanks again to everybody. I had a preliminary chat with a local independant today who brought up something that had already occured to me, that Senior Paper Monitor also pointed out. He doesn't generally offer AIPs unless there's a specific reason to do so because of the potential damage to credit rating (which, I assume, could defeat the object by making products that were previously accessible not so later on) as well as the fact that what is the best product available at that time may not be so when the buyer is finally ready to make an offer.

Thanks for the legal stuff too, may come in very handy. :beer:

Senior_Paper_Monitor

Thanks for the responses Messrs Betmunch/Plumber (we find that EAs go 'very quiet' if/when our clients hand over that document).

Sounds like your new broker knows his stuff

betmunch

I love it, I dont think its a good idea to start a fight as suggested earlier, but if its going to come down to it, having that in your arsenal would put the wind right up mortgage salesman!

moneysavingplumber

The problem is that these people's dogged 'don't take no for an answer' attitudes and lack of respect for us as customers makes it difficult to avoid confrontation over the matter. I've already sent an email to my contact at the agent, querying the suggestion that my offer won't be considered seriously unless I have an AIP through them, citing that there must be a misuderstanding as they surely wouldn't suggest such a thing in contravention of section 6c blah, blah, blah (thanks Senior!). We'll see what she comes back with!

moneysavingplumber

How strange. Following my aforementioned email, my wife rang them today to chase up a couple of viewing appointments and was given them immediately, without a sniff of 'what about your mortgage?'! Thanks all, great help and I will no doubt be seeking help again as the process goes on.

Senior_Paper_Monitor

I love it when a plan comes together

DVardysShadow

moneysavingplumber wrote: »

I've already sent an email to my contact at the agent, querying the suggestion that my offer won't be considered seriously unless I have an AIP through them, citing that there must be a misuderstanding as they surely wouldn't suggest such a thing in contravention of section 6c blah, blah, blah (thanks Senior!).

Good move!

moneysavingplumber wrote: »

How strange. Following my aforementioned email, my wife rang them today to chase up a couple of viewing appointments and was given them immediately, without a sniff of 'what about your mortgage?'!

It undoubtedly paid off, very quickly.

luckyfool

moneysavingplumber wrote: »

Thanks again to everybody. I had a preliminary chat with a local independant today who brought up something that had already occured to me, that Senior Paper Monitor also pointed out. He doesn't generally offer AIPs unless there's a specific reason to do so because of the potential damage to credit rating (which, I assume, could defeat the object by making products that were previously accessible not so later on) as well as the fact that what is the best product available at that time may not be so when the buyer is finally ready to make an offer.

Thanks for the legal stuff too, may come in very handy. :beer:

At the point you are making an offer on a property if you do not have an agreement in principle already in place then it will disadvantage your bid against competitors potentially. How is the vendor to know whether you are someone hoping to get a 100% mortgage with a £20k ccj, vs an ultra creditworthy person putting down 40% at 2 times income who could get a mortgage from any lender on the high street.

It may be that your local independent just happens to do it this way, is keying in off your own opinions (i.e. you aren't keen to get an aip now so he is going with the flow), or they may just think you are a tyre kicker/time waster and want to wait until you have a property in the same way L&C do.

In your circumstances I would be getting your broker to research the entire market and find you the best deal. Then, lender you are leaning towards based on their current products... if they leave a hard footprint then I would look at getting an agreement in principle from a different soft footprint lender (basically any, that you meet the criteria for) which would mean that the aip will not impact on your credit score at all. That gives you a certificate you can wave at the agents when making an offer, and gives you some peace of mind that the mortgage is definitely going to be available (with that lender at the very least). Once your offer is accepted your broker can redo the lender research and you can go forward with a proper aip and then application to the best lender. As per the posts above the agent cannot refuse to pass your offer on, but if there are multiple different offers and you did not have an agreement in principle in place they are perfectly within their rights, and you could argue that they have a duty to(and almost certainly will) make the comparison between your offer and the offer from Joe Bloggs. i.e. Joe Bloggs is a first time buyer, has a mortgage agreed already and on the table and is ready to go, whereas Mr Moneysavingplumber doesn't have their mortgage agreed yet and we could find ourselves 3 or 4 weeks down the road before we find out they can't get a mortgage and have to put your property back on the market. Take my advice mr seller and just go with Joe Bloggs, its the safer option.

This route involves a bit more work for the broker, but it is more likely to get you there in the end and doesn't impact on your credit score. To be honest I personally would not be too fixated on hard footprints vs. soft as long as you're confident your credit history is good and you don't go shopping around getting searches run right left and centre. One search at aip stage, and potentially another in a month or 2 once an offer is accepted is not going to make a big difference on your score unless you are very much borderline anyway, having said that if its the credit searches that you are worred about then doing it the way I've outlined above solves your problem.