EA dodgy tactics

MK__2

Thought I'd share a worrying experience with an EA recently - (you know, one of those branch-in-every-town ones)...

Tried to book a viewing with a house just entered the market - and was quizzed by EA about how much our LTV % was. Thought that was a bit odd, but managed to duck the question saying my partner deals with that stuff and was unavailable.
We viewed the house and liked it, but when we contacted the EA to submit the offer, they said they would need to see "full Agreement in Principle with a HARD credit check", and see proof of funds! :eek: Having a laugh?! This is BEFORE an offer was submitted or accepted.

Spoke to my solicitor who said we don't have to show them anything until an offer is accepted, so we haven't. Offer is still on the table, and they've said they are "waiting to see how the market responds". Their tactics have made us feel so uncomfortable we're thinking of just walking away.

eddddy

MK_ wrote: »

Their tactics have made us feel so uncomfortable we're thinking of just walking away.

I guess it depends how much you want the house. (i.e. Avoid cutting off your nose to spite your face etc.)

Maybe just confirm your offer by email (or letter), and say that you will provide financial details if/when the offer is accepted.

By law, the EA must pass your offer on to the seller. But the EA might advise the seller to wait before accepting or rejecting an offer.

Obviously, the seller can choose to follow the EA's advice, or ignore it (and accept or reject your offer immediately, if they want).

AdrianC

The EA are making sure you're not wasting the vendor's time - that you can actually afford to buy the place. And you're going to find that with a LOT of EAs - some for viewings, almost all for an offer.

No, you don't HAVE to show it, and yes, they do HAVE to pass any offer on. But the vendor (who decides whether to accept an offer) might easily agree with the EA that somebody who won't/can't prove they can afford it isn't somebody they're willing take the house off the market for.

What's the problem in showing them the details? Just because you can afford more than you've offered doesn't mean you are necessarily willing to pay more for this place.

MK__2

What's the problem in showing them the details? Just because you can afford more than you've offered doesn't mean you are necessarily willing to pay more for this place.

That bit is fair enough, but by the fact that they haven't accepted or rejected the offer yet, my guess was the EA wanted to know our position so they could advise whether to hold out for more, or even use our offer to get more out of other clients if this is what they do as a matter of course.

It was the 'hard' credit check I really couldn't get my head around. EA specifically said hard check. Why would we waste 2 hours of our lives going through a mortgage application and leaving a footprint on our credit file if we hadn't had an offer accepted?

Surrey_EA

It's a tricky one. Not an approach I personally take.

However, there's a slight chicken and egg situation here. If the EA cannot verify that a purchaser can be reasonably expected to obtain finance for the purchase a seller may not wish to accept an offer.

An AIP/DIP without a hard credit check is not always sufficient, as a prospective lender may not have access to all of the information necessary to decide whether to offer finance.

Believe it or not it is not uncommon for a buyer to make an offer for a property, and then later discover they cannot obtain the finance needed to go ahead with the purchase. The EA is employed by the seller, and one of their tasks is to try to avoid this situation occurring.

As others have said, it really comes down to how much you want the property in question.

ETA: Not sure I'd describe it as "dodgy tactics". Perhaps a process you don't agree with, but not necessarily dodgy. They may be asking as a result of instructions from their client.

LoopyLoops

We accepted an offer from someone, took our house of the market only to find out a week an a half later that they couldn't get the mortgage after all to buy our house. Next offer we wanted to know that they had already started the process to get a mortgage, the buyers broker has been in touch with our EA and the EA has the buyers solicitors details. We feel much more confident in this buyer.

AdrianC

MK_ wrote: »

That bit is fair enough, but by the fact that they haven't accepted or rejected the offer yet, my guess was the EA wanted to know our position so they could advise whether to hold out for more, or even use our offer to get more out of other clients if this is what they do as a matter of course.

Is your offer based on the absolute maximum you can afford? Or the absolute maximum you're willing to pay for that house...?

No matter which it's based on, other people may yet be willing to pay more - but that doesn't mean you're willing to pay more, does it?

eddddy

MK_ wrote: »

... or even use our offer to get more out of other clients if this is what they do as a matter of course.

To be fair, when I sell, that's the sort of thing I would pay an EA to do.

I pay them 1.5% in the expectation that they might get, say, 3% more for my property.


Just present your offer, and yourself, in the best light you can. I'd say it's very unlikely that a seller would reject an acceptable offer, simply because you haven't been hard credit checked yet.

(Although, I suppose if they have two similar offers - one from a buyer with a hard check, and the other from a buyer without one - that could swing the balance.)

KateySW

I understand it might swing the balance and make you seem like credible buyers... but do they really expect you to go through a hard credit check before you've even had an offer accepted? Sorry, I know they're probably just wanting to make sure you're serious but that seems ridiculous. I've been house hunting recently and I made offers on several other places (pretty brutal market where I live) before I had one accepted.

Do you have a MIP? Could you not just show them proof of that to placate them? Proof of funds wouldn't be too illogical either but hard credit check before you've even put an offer forward doesn't seem reasonable to me.

MK__2

AdrianC wrote: »

Is your offer based on the absolute maximum you can afford? Or the absolute maximum you're willing to pay for that house...?

Max we are prepared to pay. We've got a decent deposit and banks will lend us up to the value of the house anyway. I just felt really uncomfortable about providing the EA with all that information. Surely they just need to know we are proceedable?

Based on what others have said, maybe the EA are just being a bit belt-and-braces...

saajan_12

MK_ wrote: »

It was the 'hard' credit check I really couldn't get my head around. EA specifically said hard check. Why would we waste 2 hours of our lives going through a mortgage application and leaving a footprint on our credit file if we hadn't had an offer accepted?

Because you want to buy that house and that's what the vendor / their agent demands to consider you..

If you're looking to buy something anyway in the next few months (as opposed to holding out for a particular house) then you'd be applying for a mortgage anyway, so does it really matter whether you do the hard search for this property or another?