gazumped on repossession

nads0622

Hi just wanted some general advice on a property we have just been gazumped on. We viewed the property a day after the estate agents had had a second round of sealed bids. The property was on at £250,000 and we decided to offer £275,000 as there were several offers over £250000. we got a call the next day saying that our offer had been accepted (22 december) and that we had to exchange by January 18 and the survey done by 31 december (bearing in mind this is over the christmas period.) We were advised the property would still be marketed which we appreciated as obviously the bank has to get the best offer.
we pushed to get the survey done, mortgage offer out and our solicitor has worked really fast so we were ready to exchange last thursday (6 jan.) On Weds (5 jan) we got a call saying they had a cash offer from a previous sealed bidder, the same as ours but the bank was waiting for our survey results? which came that day. On the thurs we got a call saying the other party had increased their offer and we had until they brought in proof of funds to exchange, which was too quick as I was in another city, they then rang to say they had seen proof of funds and we agreed to £277000 and that we had until monday (today 10 jan) to exchange. Last friday we were on the way to the solicitors to exchange when we got another call sayng that when they had told the other party they had given us until Monday to exchange the other party had increased their offer again and could we match the other offer at £285000 and if we could it was ours. Obviously by this point we were getting fed up so got back to them and upped our offer to £281000 which they got back to us and turned down. On friday it ended with them telling us that if we upped our price to £285, 000 or close to it would be ours at which point we decided to take a step back as we felt we couldn't trust the agents (at this point we were in the solicitors ready to exchange) and felt pressurised and told them we would get back to them. (plus the agents kept saying they wanted us to really have the property which we knew was a standard line)

Today morning the agents rang us up to see if we were upping our offer we got back to them later on in the day and said we would pay £285000 and they said it wasn't enough so it seems the other buyer has upped their offer again. Its not losing the property we mind, its the way we have been treated, we have pushed our solicitor/mortgage advisor done everything the agents and yet they kept changing the boundaries. Was their any need for them to tell the other party our offer and that we were ready to exchange on 2 occassions? the other thing we find suspicious is that when our offer was accepted we were told that it was bank policy not to put stc on rightmove as it had to be marketed until exchange, however today they have put the property on stc after accepting the other parties offer, even though our solicitor still has the paperwork so it will be at least a week before the other party exchanges.
I wanted to highlight how ruthless agents can be when dealing with repossessions as well as seeking advice as to whether the agents have been fair in dealing with us and the other party
thankyou

Doozergirl

It's not the agents, it's the lender, or the lender's agent.

They are obliged to find the best offer. I am surprised that they are finding nothing acceptable despite you being ready to exchange but if this is a very determined or experienced cash buyer then they too could be in a position to complete within hours if they wanted to.

Agents don't like selling houses twice once a price has been agreed but this is the nature of the beast with repossessions.

Perhaps with the SSTC, they have actually exchanged, or quite possibly, despite them not being supposed to, they've had enough of the sniping, think the property is at it's value and that one of you is definitely buying. Especially as you are ready to exchange.

I'm sorry it's working out like this for you, but the agent will not be getting any joy from this situation either. Yes they have to find the best price and while there are people wanting to buy potentially at higher prices, they need to do that by law.

As a last resort, ask your solicitor to push and see if their solicitor are ready to exchange at your best price just to get an answer back via the lender's official channel.

G_M

That's repossessions for you! If you'd searched for 'repos' on the forum you'd have known it works like this. Until you Exchange, nothing is guaranteed.

The bank (don't blame the agents for doing their job!) has a legal duty to mitigate the losses of the repossessee - ie to get the max price possible. If that means playing off several interested parties against each other, then that's what they'll do.

Where a property is competitivly priced, as repos often initially are, it can be very attractive to multiple buyers. There are three rules:
1) decide your max price and never go above it
2) move fast
3) accept that you might spend money (on survey, legals etc) and then lose out.

_bankrupted

I don't think the EA has been ruthless, they are obligated to get the maximum sale price for the property.

I have been in the same situation as yourself, and have posted about the experience, in my case I was never told the offers the other party had made, eventually I was forced to sit down with my girlfriend and discuss what the house was worth to us and hence we made that offer.

My philosophy in life is that you buy according to something's worth to you and sell in the same manner. What the agent did or didn't do is really unimportant as in this case the property wasn't worth more to you, and to someone else it was. The agent has merely allowed each party to show their true hand (so to speak). If you had made your final offer very early then the points you have issue with would never have arisen and you would have realised that another party was prepared to pay more.

It's natural to be miffed as you have lost out and in the process have been forced to offer more for the property that you have eventually failed to secure. But if you really think about it why are you annoyed, someone was prepared to offer more and you weren't, there isn't blame to be apportioned anywhere.


If you think that there may have been no other party bidding ( I know you aren't really implying this) then just keep an eye on the property, if it's back on the market, then make an offer of your original 275k and stick to it!

Maybe a silver lining, that if it's back on the market the 1.3% fall this month and 2011 starting with a lot of doom and gloom there will be less of an appetite for a bidding wars on the property.

Enfieldian

As above, not the agents fault.

They really don't want to be having to show people around a property that already has a sale agreed on it, it can only sell to one person, after all....

Not to mention the fact that a new offer late in the day means they have to wait longer for their fee, which for 1.5 or 2% of 10,000 really isn't worth it.

Incyder

Tell them all to shove it up their pipes.

Doozergirl

Incyder wrote: »

Tell them all to shove it up their pipes.

Inspired.

Kicking out time is it?!

nads0622

Thank you Doozergirl for your reply i appreciate your comments Just a note
'Perhaps with the SSTC, they have actually exchanged...' our solicitor still has documents, although it is possible i suppose that they may want to exchange asap

G_M thank you for your constructive comments...i agree nothing is a guarantee until exchange the law of the land. Hence why we tried to exchange 12 days earlier than the bank had suggested, this shows our commitment to exchange and complete early especially if you take into consideration the long festive break......

The bank i believe have duty to the debtor to obtain the 'best price' and a duty not to incur additional costs to the debtor in reaching the 'best price'. My understanding is that the best price is not always the highest price. The bank in my view (understandably :-) are taking the risk with a buyer who may not complete (ie not undertaken a survey etc or just pumping up the price) and consequently not only not fulfilling the duty to obtaining the 'best price' but also incurring additional costs to the debtor and if the buyer did not complete and the bank did not achieve close to the price they could have, especially if i am (or anyone else is) no longer interested in the property. Does that not open the door to the debtor taking a damages claim against the bank. Is this worth the risk against a 100% certain ready on the day to exchange buyer, who maybe paying only slightly less. Just a thought!

I agree with the your final 3 points and this is good advice to others.

_bankrupted...thank you for your comments.
Just to give you a further insight into our experience..I agree with your point to make your best offer earlier on...We were requested by the EA that all parties to give best and final offers in a sealed bid. We offered £275000 the other buyer offered £260,000 and the guide price had been £250,000. Our price had reflected that a new boiler,radiators, doors, kitchen, toilets etc the usual in a repo had to be replaced as the previous owner had taken them with him as well as other costs including those we envisaged may come up on the survey. Fairly logical in any house buying process. Hence at that time that was the 'best offer' and by no means a repo bargain but a home that ticked all the boxes.

The survey was carried out and was not as bad as we had envisaged, so when the EA requested we up our bid by £2000 initially on the day before exchange to secure the property we thought that was okay in order to ensure we exchanged, as we had saved on some of the remedial work from the survey....when the EA subsequently requested we up our bid on the day of exchange the opportunity cost was of delaying moving in for a number months until we had monies to undertake the work required..not an ideal situation. I am sure you would agree no one could have had envisaged this situation at the sealed bid stage, or certainly not us, therefore we had not costed it. Hence we made the decision to live with parents until such time we had monies to do the work...so in short we at the time of the sealed bid as requested did give our best offer in good faith and did this early on, unlike the other buyer. So if there is a lesson to be learnt from this, it is to do the opposite to what you suggest and do what the other buyer did and wait until the day of exchange and then show your best hand ;-)

Contray to what you state i am not miffed at having to pay more and losing out, I am more miffed at the process (and losing out). As mentioned above we at the sealed bid stage put in our best offer at that time, well above the buyers and above the guide price. We were requested by the Bank to exchange by 18th Jan we contacted the EA on 5th jan to inform them we were ready to exchange the next day 12 days early (that shows our commitment to complete early a mean feat if you consider we had a long festive break in between) On the same day they get an offer from the other buyer which sets of the chain of events, i am convinced the buyer is mystic meg (not). Our mistake i suppose is we should have not informed the EA and gone via the solicitors directly. Although i still fully appreciate we have nothing until we exchange, but we were never allowed to get to exchange even after our best efforts.

I take your point and remain optimistic :-)

maninthestreet

".....the agents kept saying they wanted us to really have the property...."

This tells me that the other 'buyer' may have been a figment of the EA's imagination.

poppysarah

You are chasing rainbows until it's done and dusted.

I'd never up my offer on a repo - there are plenty of them out there and they're not going to stop appearing anytime soon.
Let someone else have it at a low price and this brings the prices down for an area.

Now an ea can honestly say "demand is up" because silly over-rich people are playing games.

Gwhiz

As a matter of interest, what are the best online sources for repos?