Is the agent being illegal???

jamesd

thesaint, I trust that you agree that an act described as breaking the law is an illegal act.

"The OFT can issue a warning order if you break the law relating to:

information on charges
definition of terms
your personal interest in a sale
information to clients about offers
information to clients about services provided to buyers
misleading statements
bias against buyers
interest on clients' money."

Now, your hypothetical vendor agreement:

"Avoiding bias
You must not discriminate against potential buyers because they don't want, or might refuse, to take services from you or a connected person.

For example, you must not:

refuse to provide information about a property to these buyers
take longer to send property information to these buyers, compared to others
set additional requirements, as a condition of passing on an offer, eg, forcing them to have a mortgage survey before you will pass on their offer to your client."

Hence it is illegal for an estate agent not to pass on an offer in writing unless the prospective buyer talks with their mortgage adviser, because that breaches the bias against buyers part of the law. Your hypothetical agreement with the vendor appears to be one the agent is prohibited from making.

thesaint

AndrewSmith wrote: »

As it is your perogative to clarify anything you do not understand, however having over 8 years prior experience as a Financial Services Manager/Director in estate agency I know that I am correct. By your own admittance you have very little experience of estate agency dealings, however I respect you opinion right or wrong.



No I am saying nothing, merely quoting from the government information website direct.gov

I was seeking clarification because you stated information as fact, namely post #5

They are in breach of the Estate Agency Act whereby all offers must be put forward to the vendor in writing.

Despite 8 years experience..., this is incorrect.
This isn't opinion.

thesaint

jamesd,
I understand what the estate agents act says, but what is not clear to me is whether a vendor can stipulate the terms.

Estage agents must not:

set additional requirements, as a condition of passing on an offer, eg, forcing them to have a mortgage survey before you will pass on their offer to your client.

The legislation seems to prevent Estate agents doing it without their clients knowledge. Can the client set the term?

thecutestlittlefish

Thanks very much for all your advice, I will ask my mortgage advisor to fax something confirming I can afford the property but not how much I can afford. And when I go take my parents for a look I will check with the vendors that they are getting offers as the estate agent is being difficult, I cant imagine the vendors saying offers under a certain amount are not to be put forward as I know they are in a rush to move and have taken an offer before.

And yes it was Bairstow Eves!!

Thanks again!! :beer:

lynzpower

thesaint wrote: »

jamesd,
I understand what the estate agents act says, but what is not clear to me is whether a vendor can stipulate the terms.

Estage agents must not:


The legislation seems to prevent Estate agents doing it without their clients knowledge. Can the client set the term?

vendors can stipulate a lot of things and in the main EAs have to abide by their desire s HOWEVER, I would suggest as both Andresw & Rick have said that in terms of the "in houser mortgage advisor bit" I would expect that IF the vendor wanted to stipulate that any buyers had to have seen the inhouse mortgage advisor, I would say at this point, the EA should then say to the vendor, we will be breaking FSA guidelines here and thus the law ( as andrew has said) and thats not something we can do.

The EA where I worked would never entertain that from a vendor.

courtjester

For the sake of clarity, *IT IS ILLEGAL* for an agent to REFUSE to pass on an offer on grounds that the agent requires the purchaser to be 'qualified' by their mortgage advisor first.

This is discrimination against the purchaser which is defined specifically as an undesirable practice for which the agent can be prosecuted and or their trading licence endangered.

It has NOTHING to do with any instruction the vendor may have given the agent over the level of offers, it is purely about the agent trying to sell their financial services to purchasers, which is a clear and direct conflict with their client's interest.

See:
Statutory Instrument 1991 No. 1032
The Estate Agents (Undesirable Practices) (No. 2) Order 1991
http://www.opsi.gov.uk/si/si1991/Uksi_19911032_en_3.htm

Schedule 2
Discrimination against purchasers on grounds of services taken or not by purchaser.
Disclosure (to client) of applications for services by purchasers (i.e. mortgages being arranged by agent for buyer).

Schedule 3
Failure to forward offers promptly in writing and accurately...

******

Schedule 3 provides the defence that offers do not have to be forwarded if the vendor has indicated (in writing) that he does not wish to accept such offers, but this is quite disctinct from the agents liability under Schedule 2 (discrimination against purchaser). In such cases (offer below clients minimum), the agent should be advising purchasers that the offer is not within the requirements of the client authority and cannot be forwarded.

Note, the OFT do NOT make the law, they merely enforce it and provide guidance on good business practice for estate agents. They don't always get their guidance clear, so reference to the wording on the OFT site should be made only with some care.

thesaint

I think we are going around in circles.

The guidelines make it clear that the Estate agents would be acting illegally if it could be conflicting with their clients interests.

What if their clients are party to the agreement(full disclosure), is what I am seeking clarification.

blessings3

No your being a pompose little twit offering nothing in the way of real guidance or advice to the OP

thesaint

blessings3 wrote: »

No your being a pompose little twit offering nothing in the way of real guidance or advice to the OP

Pot calling kettle...

jamesd

thesaint wrote: »

what is not clear to me is whether a vendor can stipulate the terms. ... The legislation seems to prevent Estate agents doing it without their clients knowledge. Can the client set the term?

The Act prohibits bias against specific buyers relating to the taking of additional services from the agent.

I see no part of this section of the law which allows a vendor to agree to it, nor would it make sense for there to be one, since one purpose of this section is to protect buyers.

For example, without this section all prospective buyers could be required to purchase a survey or home information pack, or pay a fee to make an offer, regardless of the merits of their offer, and the vendor and agent could agree that the vendor would not be charged at all.

The legal obligations of the agent aren't solely to the vendor.