Estate Agent asking to see AiP before submitting offer

techguy81

Hi, I am a first time buyer and want to place an offer on a house I like. I already have an Agreement in Principle from a major bank.

The Estate Agent is insisting on seeing the AiP before submitting my offer to the vendor, due to the number of failed offers they've had, which is fair enough.

Only thing that concerns me though, I am offering about 13% below the asking the price and the AiP shows we can borrow a higher amount than we are offering. I feel that this could give the EA an unfair advantage in haggling over the price.

Will the EA accept the AiP if I redact the amount available to borrow, but maybe leave the zeroes on? They will at least then know roughly how much I can borrow, but not the exact amount. Or am I overthinking this?

eddddy

The EA is legally required to inform the vendor of your offer, with or without seeing the aip - unless the vendor has explicitly said "don't forward any offers without seeing an aip" (which is very unlikely).

My guess is either:

i) the EA wants to judge whether you have scope to increase your offer (as you suggest).

ii) the EA wants you to meet with their own mortgage advisor, and the more they know about your aip, the more ammunition they have to persuade you to meet.

I agree that obscuring the amount available is the best approach. You are showing willing, but not giving away any info which can be used to your detriment.

If the EA continues to hassle you, say something like "as soon as the offer is accepted, I will ask my solicitor to confirm all the details with the vendor's solicitor".

betmunch

I agree with Edddy, we get this all the time.

Depending on how much of a fight you want with the EA you can stand your ground or give in.

Personally I advise clients that they should only provide the AIP when the price has been agreed.

techguy81

Thank you both for the advice.

The EA claims the vendor is insisting on proof as they've been messed around a lot. The house has been up for sale nearly 18 months and a few sales have fallen through so far, so maybe they are telling the truth. However, I think they have told me a few porkies so far so I'm not about to start trusting them now.

I have redacted a digit from the amount available to us, but the EA will at least know we are in the same ballpark. Be interesting to see how they respond.

eddddy

techguy81 wrote: »

Thank you both for the advice.

The EA claims the vendor is insisting on proof as they've been messed around a lot. The house has been up for sale nearly 18 months and a few sales have fallen through so far, so maybe they are telling the truth. However, I think they have told me a few porkies so far so I'm not about to start trusting them now.

I have redacted a digit from the amount available to us, but the EA will at least know we are in the same ballpark. Be interesting to see how they respond.

Be a little cautious - if a few sales have fallen through, I would say it's more likely to be because the surveys or searches are showing up a problem, rather than because a series of potential buyers have lied about having aips.

Bazshawkins

By redacting the amount, you are basically saying "I have more than what I've offered", otherwise you wouldn't mind them knowing.

techguy81

eddddy wrote: »

Be a little cautious - if a few sales have fallen through, I would say it's more likely to be because the surveys or searches are showing up a problem, rather than because a series of potential buyers have lied about having aips.

Thanks, I have asked them outright a few times if there has been a problem with the surveys but they are insisting not. Supposedly at least one fell through due to a change in circumstances and another because the buyers found a better house. But yes, I agree, take everything they say with a pinch of salt.

lfc321

We had the same thing and did give the EA the AIP. I don;t see the problem with it.

We made it clear that our (low-ish) offer wasn't related to how much we could borrow (we could have borrowed much more): it was a reflection of how much we believe the house was worth.

An EA could only use the information on the AIP 'against you' if you agreed to increase your offer. If you make it clear that your offer is as high as you're willing to go for that house it doesn't matter if the piece of paper says the bank will lend you £1 trillion - it's irrelevant.

And if the EA (and possibly the vendor) are insisting on it then I don;t see any point in being difficult from the start of the negotiation - unlikely to make them well-disposed towards you.

techguy81

Bazshawkins wrote: »

By redacting the amount, you are basically saying "I have more than what I've offered", otherwise you wouldn't mind them knowing.

True, but they would know this anyway if I didn't redact and at least this way they don't know just how much more I have to offer.

Jimbo1976

Whilst I understand the cynicism, the estate agent's duty is to their clients and clearly making sure that the person making the offer can afford the property is part of the job. You don't have to spend long on this forum looking for people who thought it would be a walk in the park to get a mortgage who seem rather surprised that their credit history/lack of earnings/lack of proof of earnings/lack of deposit etc prevents them from getting a mortgage.

Here is a link to the code practice on the Property Ombudsman site

http://www.tpos.co.uk/downloads/TPOE27%20Code%20of%20Practice.pdf

See section 8 on financial evaluation.

However I do understand that you are nervous that if you show you can afford more than the offer price that may put you at a disadvantage when you are negotiating. However all it means is that you can't say "I can't afford to pay more", you can say "I don't want to pay more"

martinsurrey

get a halifax online AIP for the exact amount you have offered, Halifax (to the best of my knowledge) only do a soft search on you at AIP stage, so it wont effect your credit file.

bobs your uncle, the agent has no room to push you up.