Estate agent making unreasonable demands?

DesperateHouseBuyers

Hi all

I wonder if anyone would be able to advise or shed some light on this situation?

My partner and I put an over asking price offer in on a property on Sunday, sent through our proof of deposit and mortgage in principle. They’ve asked for best and final offers by Wednesday. Now the estate agent has said:
- our mortgage in principle isn’t “valid” as no credit check has been done and they need proof that the lender has seen our payslips. From my googling I can only find two providers that do hard credit checks at the mortgage in principle stage. Besides, we don’t want a credit check on our record when we are hoping to apply for a mortgage soon. Does anyone know if this is allowed? It seems completely over the top and we’ve made a few offers now and not had any issues with our Lloyd’s MiP.
- as we have offered over the asking price (very common in our area), they are asking us to confirm in writing that we will cover any difference in the valuation. I’m hesitant to do this as what if the valuation comes back significantly less than our offer? We can cover 5-10% difference but no more.

We really love this house and keep losing out on properties, but I feel like the estate agent is asking for far too much. Does anyone have any ideas how we can show we are serious buyers and financially sound without having to do a pointless credit check with a lender we don’t intend to use for the actual mortgage?

Thanks!

Comms69

You aren’t bound to ANYTHING until exchange; they can ask for whatever they like.

eddddy

DesperateHouseBuyers wrote: »

Does anyone have any ideas how we can show we are serious buyers and financially sound without having to do a pointless credit check with a lender we don’t intend to use for the actual mortgage?

This might be a cynical attempt by the EA to get you to use their mortgage broker (so they earn extra fees).

In you position, I would send an email to the EA saying something like :

"As soon as our offer is accepted, we will make a full mortgage application, and ask our lender to contact you regarding a valuation as soon as possible. This should reassure the sellers that we are genuine ready, willing and able buyers.

Please pass this information on to the sellers along with our offer."

DesperateHouseBuyers wrote: »

- as we have offered over the asking price (very common in our area), they are asking us to confirm in writing that we will cover any difference in the valuation. I’m hesitant to do this as what if the valuation comes back significantly less than our offer? We can cover 5-10% difference but no more.

If you put this in writing it will be assumed to be 'subject to contract' - so it won't be binding. You can still change your mind.

If you want, you can clarify this by saying something like:

"We do not intend to reduce our offer following the valuation, but our offer is, as always, subject to survey and subject to contract"

steampowered

I would tell the estate agent to do one.

Just reiterate your offer, confirm that you have provided an MiP from your lender and say that you await the vendor's response.

It is up to the seller to decide which offer they want to accept - not the estate agent.

jennhg88

That's completely ridiculous, all of it.

I'd tell them to jog on, personally.

Pixie5740

eddddy wrote: »

This might be a cynical attempt by the EA to get you to use their mortgage broker (so they earn extra fees).

That's exactly what went through my mind as well.

AdrianC

DesperateHouseBuyers wrote: »

- as we have offered over the asking price (very common in our area), they are asking us to confirm in writing that we will cover any difference in the valuation. I’m hesitant to do this as what if the valuation comes back significantly less than our offer? We can cover 5-10% difference but no more.

Look at it from the vendor's PoV (and remember, the agent is working for the vendor).

They've got a potential buyer who has placed a bid higher than the asking price, and higher than they suspect the val will come back at. They want to know that you're actually ready, willing and able to put your money where your mouth is, and not suddenly say "Ooooh, but but but..." and chisel back.

Hardly unreasonable of them, is it?

SmashedAvacado

Just say you have the ability to call upon extra funds to make up any shortfall.

The agent is legally bound to put any offer to the seller so the best advice is to clearly explain your position in writing as part of your offer. The offer is not legally binding so you can always pull out at any stage.

As an aside, if you are successful - Presumably if there are sealed bids, the agent can share this with the valuer and that will be the best evidence of "market value". Make sure the agent is reminded to do this - the agent will be interacting with the valuer to get access to the property.

eddddy

SmashedAvacado wrote: »

As an aside, if you are successful - Presumably if there are sealed bids, the agent can share this with the valuer and that will be the best evidence of "market value". Make sure the agent is reminded to do this - the agent will be interacting with the valuer to get access to the property.

I don't think a valuer would take information from sealed bids into account.

If nothing else, I could offer £202K for a property and get 10 of my mates to offer £200k.

... or alternatively get 10 of my mates to offer about £175k

SmashedAvacado

Yes Eddy, but those bids would need some DD by the EA to be considered valid bids - just like the bid from the OP. So your mates might need to demonstrate proof of funds and mortgage offer in principle.

Valuers will look at a number of factors - this includes what is happening in the local market, and they get this from the agents. They have to look at more than the sold prices section of rightmove because not all properties are comparable and some markets move more slowly / quicker than others.

m0bov

You can ask your broker to contact the EA to confirm.

Nobody applies for a mortgage on a property they have not had an offer accepted on. It will damage your credit rating to keep making hard applications.

Go speak to the owners and tell them the EA is trying the hard sell and wont let you offer. If the lenders have instructed the EA to do all this, then best find another house.