Vendor Paying Buyers Solicitor Fee's/Other Incentives

jimbog

For the vendor this would be a disaster. The buyer would have spent nothing and so can pull out at anytime with no losses leaving the vendor with the bill. It would also leave the vendor vulnerable for gazumping

davidmcn

darrenmcneill wrote: »

But yet Banks have offered similar products if their mortagage is taken out?

Yes. Not sellers.

Like I said, it's allowed, as long the lender knows about it and is happy with it. But it generally means they'll redo their calculations and it will end up no better than just discounting the price. Lenders have had their fingers burned in the past with undeclared "cashback" deals and the like.

darrenmcneill

jimbog wrote: »

For the vendor this would be a disaster. The buyer would have spent nothing and so can pull out at anytime with no losses leaving the vendor with the bill. It would also leave the vendor vulnerable for gazumping

For the vendor this would be a disaster. The buyer would have spent nothing and so can pull out at anytime with no losses leaving the vendor with the bill - Not if it is only payable upon completion, but a good point and definitely one to consider!

sparky130a

I still don't get the point? Why?

darrenmcneill

davidmcn wrote: »

Yes. Not sellers.

Like I said, it's allowed, as long the lender knows about it and is happy with it. But it generally means they'll redo their calculations and it will end up no better than just discounting the price. Lenders have had their fingers burned in the past with undeclared "cashback" deals and the like.

I understand that it is allowed (My original post did not mean to mention illegal, but unfavourable). My interest is the number of lenders who allow X & Y, and whether the incentives would drastically reduce the number of vendors available to potential buyers. I have contacted my mortgage adviser directly for more concrete responses.

Having viewed the Council of Mortgages incentives rules for lenders, there are some that do not require anything to be reported if <10% or <5%, where-as some lenders wish to have all aspects disclosed. I have no issue with the reporting side.

https://www.cml.org.uk/lenders-handbook/englandandwales/question-list/2054/

From research it does look like white goods incentives are looked on more favourably than deposit contributions.

davidmcn

darrenmcneill wrote: »

I understand that it is allowed (My original post did not mean to mention illegal, but unfavourable). My interest is the number of lenders who allow X & Y, and whether the incentives would drastically reduce the number of vendors available to potential buyers. I have contacted my mortgage adviser directly for more concrete responses.

Having viewed the Council of Mortgages incentives rules for lenders, there are some that do not require anything to be reported if <10% or <5%, where-as some lenders wish to have all aspects disclosed. I have no issue with the reporting side.

https://www.cml.org.uk/lenders-handbook/englandandwales/question-list/2054/

Some might not want to know, and if it's relatively trivial then it's unlikely to make a significant difference to the others, but why make life more complex for your buyer? (who may, for other reasons, want to use one of the fussier lenders)

eddddy

It seems that a free meerkat toy influences some people's insurance buying decision - so maybe free legals, white goods and home furnishings would influence some home buyers' decisions.

But I suspect it would also deter some people who perceived it as a cheap gimmick - like the meerkat toy.

(And this sounds similar to a dodgy scheme run by an EA chain. People might suspect that you are up to the same tricks as them.)


With houses, it might be more usual to spend the extra money on upgrading the fixtures and fittings - rather than on 'cashback' type incentives.

Cakeguts

The houses that I have seen advertised like this have all been in areas where no one wants to live and a reduction in price wouldn't make any difference so they are trying to sell to someone who wants to buy a house but can't really afford it. I have seen houses advertised like this on several occasions over the years.

martindow

I suspect it could involve the vendor specifying the solicitor to use. This is analogous to using solicitors recommended by new build companies where there can be a possible conflict of interest.