Upfront deposit - the only way to test a buyer's bona fides?

Jolanta_Nowak

Have sellers on here found that asking for a reasonable-size, upfront, non-returnable deposit has sorted out the genuine buyers from the hedging-their-bets types?

I have even heard of one seller who charged a fiver for each viewing and found that this neatly disposed of the 'just nosey' gawkers.

Any experience in this area of the game?

gingin_2

In this market (a buyers market), if I was asked to pay an upfront deposit or even 50p to view a property I would not look at the property out of principle unless it was a bargain bucket price (and I mean bargain bucket).

I'm pretty sure you would alienate a fair percentage of buyers.

Now what can we do to check if a seller is bona fide?

Jolanta_Nowak

gingin wrote: »

In this market (a buyers market), if I was asked to pay an upfront deposit or even 50p to view a property I would not look at the property out of principle unless it was a bargain bucket price (and I mean bargain bucket).

I'm pretty sure you would alienate a fair percentage of buyers.

Now what can we do to check if a seller is bona fide?

You can ask for a similar, non-returnable deposit, to be held in common by an agreed third party. This is not rocket science.

There is an awful lot of misrepresentation taking place, I agree, on both sides of the equation.

The situation has been crying out for some time for a system to keep both parties honest. As far as I can see, if the market returns to being more in sellers' favour, there is absolutely nothing like this in place to stop practices like gazumping, just as there is nothing now to stop the timewaster, hedging-their-bets 'buyer'.

epz_2

doesnt the buyer paying for the surveys etc prove they are serious.

what happens if the buyer finds there is something genuinely wrong like industrial waste on the grounds etc, arent they within there rights to walk away.

gingin_2

Jolanta_Nowak wrote: »

You can ask for a similar, non-returnable deposit, to be held in common by an agreed third party. This is not rocket science.

There is an awful lot of misrepresentation taking place, I agree, on both sides of the equation.

The situation has been crying out for some time for a system to keep both parties honest. As far as I can see, if the market returns to being more in sellers' favour, there is absolutely nothing like this in place to stop practices like gazumping, just as there is nothing now to stop the timewaster, hedging-their-bets 'buyer'.

but unless it becomes "law" then you are likely to alienate potential buyers if you are one of few sellers in the market asking for a deposit.

We are potential ftb's and I would never choose a house where I had to pay an upfront deposit unless it was at an auction. We need to have the ability to pull out were anything to happen that meant we couldn't forward on the sale.

Lavendyr

Jolanta_Nowak wrote: »

I have even heard of one seller who charged a fiver for each viewing and found that this neatly disposed of the 'just nosey' gawkers.

Absolutely ridiculous and would certainly alienate me as a possible buyer. If the seller wants to sell their house they should be as accommodating as possible to anyone who shows an interest, particularly in today's buyer's market.

As for asking for a deposit, also a total alienator in my book.

I wish that, well, a sense of common decency would keep people honest myself. Unfortunately I agree that's not likely to be the case all too often these days. Still, I think that requesting a deposit upfront smacks too much of "guilty until proven innocent" and would not want to do business with anyone on that premise.

m00m00

having to pay a deposit would have no impact on me whether I made an offer on a place or not.

however, having to pay a deposit, means I'd be convinced the seller was grasping after every penny, and wouldn't be viewing the property anyway.

Jolanta_Nowak

Ok, then obviously none of these respondents have any issues with a seller proceeding on multiple fronts (and not telling them so) ... finishing up only with the one who moves fastest.

Two can play at the lack of openness game.

Charlton_King

Actually JN, your suggestion is pretty much right - the only way to cut out the huge amount of disingenuity happening on both sides of the housing market is a change in the law to enforce financial loss on the part of the offending party in the event of a sale falling through.

Both house purchase and sale are serious matters and something of this sort needs to be in place to underline that you should treat the other side with due respect and consideration. Unless my memory is mistaken, the law in Scotland already has something like this in operation.

What we have here is a dog's breakfast/free-for-all where, depending on the state of the market, one side or the other has an unfair advantage and there are countless tales of woe to attest to this.

Nenen

Jolanta_Nowak wrote: »

Ok, then obviously none of these respondents have any issues with a seller proceeding on multiple fronts (and not telling them so) ... finishing up only with the one who moves fastest.
Two can play at the lack of openness game.

I don't know if it is intended but you sound as if you are trying to be very vindictive rather than conduct an honorable transaction. I know it is an absolute pain in the proverbial when buyers (or sellers) mess you about but you can't really take that out on the next buyer or tar everyone with the same brush! It is human nature to want to 'lash out' when we've been wronged but the next buyer might be a very genuine and honorable person and you could well isolate yourself and scupper your chances of any proceedable sale by taking that approach.

I'm pretty sure... but perhaps someone more knowledgable than me can say for certain... that the vendor's solicitor is obliged to tell any buyer's solicitor if there are other buyers and they will be in a 'contract race'. Certainly when we were put in that position our solicitor told us straight away and we withdrew our offer until such time as the vendor wanted to proceed with only one buyer.

I think I understand where you are coming from and, like you, I wish there was some kind of deposit system set up whereby both vendor and buyer were at least liable for the other party's expenses if the sale fell through for no good reason e.g. guzumping, guzundering, vendor decides s/he doesn't want to sell after all or buyer decides they've seen something they like better. Obviously, if a survey reveals costly issues or buyer/seller becomes seriously ill/dies etc then there needs to be some flexibility. However, this would need to become common legal practice on both sides for it to work.

Having said that, Scotland has a system whereby once a price is agreed then there are legal and financial consequnces if you don't proceed and that has produced a system whereby you often have to go to sealed bids (having paid upfront for your survey and searches etc). I've heard that this often means buyers lose their survey fees several times before they get lucky!

I wish there was some sort of deposit scheme but until such time as this becomes law I think you will grossly reduce your chances of selling by charging for viewings and/or asking for a deposit in advance of exchange. Pesumably, it would also cost you money to set up a legal agreement with a solicitor for this anyway!

Lavendyr

Jolanta_Nowak wrote: »

Ok, then obviously none of these respondents have any issues with a seller proceeding on multiple fronts (and not telling them so) ... finishing up only with the one who moves fastest.

Two can play at the lack of openness game.

Why is it "lacking openness" to not want to pay a deposit up-front on a property before even having done searches, surveys - heck, before having even viewed the place (albeit only £5)?

To me, such behaviour as you describe suggests that the seller is the one lacking openness, not the buyer. In today's market, sellers cannot afford to alienate potential buyers, even if it means having to put up with the odd time-waster.

Like I said above, I do agree that things should be fair and people shouldn't be able to just back out of deals agreed - but it's not always that simple.