Estate Agents asking for deposit amount

lheh

Hi,

I'm a FTB and am struggling to buy a house in London where there is basically massive demand (open houses with scores of other buyers etc) and things are selling for sometimes around £50,000 more than the advertised asking price.

We have made a few unsuccessful offers over the last few months and one was not accepted because the EA said that we didn't have a large enough deposit (despite our deposit being more than 10%).

We decided that next time we make an offer and are asked what our deposit is (which happens every time we have made an offer) we will give our total savings amount which includes the money we will set aside for buying furniture, making any improvements, stamp duty (which will be around £10,000) and other costs of moving) rather than just the amount we have decided will be the actually deposit.

We have made an offer today and when asked what our deposit is I gave our total savings as 'the money we have with which to move' which is technically true although I know that nearly half of this will not be used as the actual deposit.

What are people's thoughts on this? The offer is well under the amount we could get a mortgage for so I am not worried about our ability to purchase this with the amount we have for deposit and other costs, but I'm concerned that by giving the EA misleading information I could have caused problems later down the line? I don't understand quite why they need this information though, as all they need to know is that we have a MIP which shows we can afford the property. As a FTB I may be wrong, but I don't see how the EA / vendor will ever actually be aware of how much cash payment we put down; all they will know is that we have a mortgage in place, not the details of that mortgage?

They are also putting a lot of pressure on us to use their mortgage advisors and in-house solicitors and have said that the vendor is only likely to accept our offer if we do so. I am not really willing to be scared into using their services and will resist this as much as possible, if only because of the way they try to pressure us to. The problem with trying to buy in a popular area of London right now is that vendors invariably have many offers to choose from and EAs are able to exploit this.

Advice and thoughts very welcome,

Thanks

cattie

You most certainly do not have to use their in house advisors or solicitors, or any solicitor recommended by them. There is no vendor in the country who signs up with an ea on the basis that accepted offers will only be from buyers wishing to use services related/connected to ea. They get a backhander when clients use a recommended solicitor, so they tend to try to push this as it benefits them.


Your solution to any offer you feel might not be put forward (although they are legally bound to put any offer forward unless vendor has told them not to bother to do so with any offer under £xxx) is to put a note through vendor's door informing them of the offer & your fear of ea trying to pressurise you into using their inhouse services.

Tell the ea firmly that you have a solicitor who has offered you a discount via family connection & you're not interested in using anybody else unless they can do a bargain basement price (ie, £250 for the actual legal work). They should then get the message that you're not to be pursuaded.

donfanatico

they pray on FTBs inexperience and insecurity, do not listen to them.

they know that you are nervous and will say anything to create fear of 'losing' a property

get educated, read as many posts here as you can as a starting point and play your own game.

Foxtons by any chance?

donfanatico

cattie wrote: »

unless vendor has told them not to bother to do so with any offer under £xxx

is this actually correct? so even though they are legally obliged to put any offer forward, they are not actually if the vendor tells them not to? right? is this common?

Thrugelmir

Vendors can instruct EA's as they wish. Plenty of time wasters look at property and make non serious offers.

cattie

donfanatico wrote: »

is this actually correct? so even though they are legally obliged to put any offer forward, they are not actually if the vendor tells them not to? right? is this common?

Yes it is correct & is something I've done each time I've sold. It saves wasting everybody's time when I know I won't want to have the bother of listening to & turning down silly offers.

The ea then doesn't have to go through the process of trying to contact me as they know straight off to tell the person making the offer that the offer is too low & vendor has asked that offers that are not at a particular level are not put forward.

lheh

Thanks for your helpful replies.

I'm not concerned that they haven't forwarded our offer to the vendor (which is slightly over asking price), my main concern is that I have given a misleading answer about our deposit amount (even though the cash we will be using for the deposit will be over 10%, but this has apparently worked against us in the past although I'm not sure why as we have a healthy combined income, no debts other than student loans etc) and don't know whether this could come back to bite us, particularly as they also try to sell their in-house mortgage adviser and say we have to go in to be 'financially verified' despite having a MIP certificate which I have offered to show them.

We've never been through the process before but from what I understand the EA and vendor will never know how much our actual cash deposit is as this will just be between us and the mortgage company, all they need to know is that we have a mortgage agreed but not how much we've borrowed - am I wrong about this?

Many thanks for your advice

hcb42

You are correct, you do not have to tell them your deposit - none of their business -

I dont think I have ever even proven I have a mortgage promise in the past either. (although as you need to move swiftly with a survey then this should be pretty clear pretty soon