"Cash" buyer doesn't have the cash

Doozergirl

cardiffborn, it seems like the EA is really wriggling.

Would it be possible to send a message via your solcitor to theirs, asking if the EA had indeed requested proof of funds, or indeed whether you could speak to your buyer directly? I can guess you mightn't want to talk to them but the reward might be worth it - I think the EA is responsible for not checking and I would be looking for a pretty discount. Especially if they are still lying.

It is possible that a buyer might provide proof of funds but then remortgage, in which case you could force their hand to exchange as they do indeed have the money!

I think it's more likely that your buyer did think they were cash buyers because they weren't using an actual mortgage secured against your place though they may as well be I think your EA probably didn't check. I have been asked for proof of funds far less than EAs have just taken my word for it!

Whelk2006

Hi. New to this forum so hello to you all and please excuse any mistrakes I make.

I've always assumed the term "Cash Buyer" to mean someone who either has sold their own property or has sufficient funds not to need to sell a property. They may not have the cash available in the bank, that would be losing them interest at the very least, but they would be able to raise the necessary funds to buy the property without having to wait.

Personally if I had sold my house, or had the kind of money one gets from selling property I wouldn't dream of leaving it in the bank, I'd invest in something which would give me a decent return, and if time was of the essence I'd raise a mortgage/loan on the purchase if necessary using my investments as collateral.

In either case it would, I think, be fair to describe me as a Cash Buyer.

Cardiffborn

Let me explain that I was told by now that the sale would be complete by now and its not and the delay is because of this re-mortgage.

The EA verbally admits they made a mistake because a less experienced member of staff dealt with the sale.

They are waiting now for searches, where if they'd been cash these would have been done by now.

My problem is firstly time, by delaying it has caused me problems. Secondly, I wasn't told the truth. Thirdly I could have had a higher sale from a non-cash deal (we were offered one). I don't think that is splitting hairs at all.

Cardiffborn

Let me explain that I was told by now that the sale would be complete by now and its not and the delay is because of this re-mortgage.

The EA verbally admits they made a mistake because a less experienced member of staff dealt with the sale.

They are waiting now for searches, where if they'd been cash these would have been done by now.

My problem is firstly time, by delaying it has caused me problems. Secondly, I wasn't told the truth. Thirdly I could have had a higher sale from a non-cash deal (we were offered one). I don't think that is splitting hairs at all.

General_Mayhem

IANAL, but AFAIK
A cash buyer is not someone who needs a mortgage, they should have funds readily available (not necessarily in cash, it could be other investments) to fund the purchase themselves. As such thier offer is not subject to conditions other than their own: for example if a mortgage is required, the lender may impose conditions as a result of the survey.

If they need to remortgage, the are not cash buyers. Simple.

You should keep a record of any extra cost to yourself, and request that the buyer pays this as they have misled you and the EA (although they should have known better). They have more to loose than you, as they have likely paid for survey and searches by now, so they will probably agree.

I am a first time buyer, and had this explained to me by the EA when making an offer. I had a mortgage agreement in principal in place, but could not be termed as a cash buyer as it is an agreement in principal, not anything else.

regularsaver1

I used to arrange further advances for people and sometimes used to be a same day completion - £100k could be in the bank the same day as day.

I have seen parents raise money on their own property to give children and then the children are classed as cash buyers

there must be a reason why their remortgage/advance has not completed yet

there is a difference in no chain than cash buyers

PasturesNew

A ‘cash buyer’ can only be described as such if he has realisable cash assets

http://www.oea.co.uk/downloads/codeofpractice.pdf (4 page PDF format)

Code of Practice for Residential Estate Agents.

See 16b

hearts

PasturesNew wrote: »

A ‘cash buyer’ can only be described as such if he has realisable cash assets

http://www.oea.co.uk/downloads/codeofpractice.pdf (4 page PDF format)

Code of Practice for Residential Estate Agents.

See 16b

Exactly my and a few others point, I think. The person in question here had the asset. A house. He was not selling his house to then buy the OPs house. He was remortgaging a house (perhaps not his main residence) He may have, and probably does have, a great deal of equity in this house. This is an asset the same as shares etc from which cash can usually be raised quite quickly.
He was not dependent on a mortgage on your property to buy it so he is indeed a cash buyer.;)

Doozergirl

hearts wrote: »

Exactly my and a few others point, I think. The person in question here had the asset. A house. He was not selling his house to then buy the OPs house. He was remortgaging a house (perhaps not his main residence) He may have, and probably does have, a great deal of equity in this house. This is an asset the same as shares etc from which cash can usually be raised quite quickly.
He was not dependent on a mortgage on your property to buy it so he is indeed a cash buyer.;)

Quoted from the relevant 16b referred to by Pastures New:
"16b Cash Buyer. A ‘cash buyer’ can only be described as such if he has realisable cash assets – that is:

* he has sufficient cash in the bank, building society or other investments, which can be realised in a reasonable time. ie. it will be available by the estimated or proposed exchange of contracts and completion dates.
OR he has actually sold a property – ie, he has exchanged contracts (in Scotland, conclusion of missives) and is expected to achieve completion on his sale before exchange on his purchase – AND he does not require a mortgage to make up any difference in the purchase price of the new property."

A house may be an asset, but it is not a cash asset. He is not a cash buyer!

hearts

lol..fair doos DG. I made the mistake of not actually reading it. ;-) but I don't think it says what you are thinking it says.
In my opinion you are misinterpreting the passage referring to a mortgage. I think this means a mortgage on the purchasing property, which he does not need.

In my opinion, for me personally I would consider him a cash buyer. My reasoning for this is.
He does not have to sell anything to raise the capital to purchase the house. I think a house fits into paragraph one under "other investments". ;-)