Putting offer on a property

safwan19

Just put an offer on a property and the estate agent said “ Our client is strongly considering your offer and our client has requested that you submit your full mortgage application and have the mortgage valuation carried out before they decide to formally accept an offer and raise a sales memorandum.” 

Is this normal? asked family and friends they said doesn’t work like this because there is no guarantee with out sales memorandum i will get the property even after getting a solicitor, paying my broker, paying valuation fees. 

Can I even apply for full mortar application with sales memorandum

Any advice will be helpful from 

Thank you

mlb95

That doesn't quite sound right. We've asked our mortgage company to complete the survey at the same time as the valuation. I certainly wouldn't be paying money like you say for all that without any commitment from her side. Does your mortgage advisor give any advice on this , it doesn't sound worth the time, effort and money if they've not accepted the offer. 

Do you know why they won't accept till all that is done ? 

AdrianC

There's never any guarantee until exchange of contracts anyway.

What they're trying to do is insulate themselves from somebody who offers, then discovers their lender are downvalueing the property, so tries to chip the price down or pulls out.

What is "normal" is irrelevant. If that's the way the vendor wants to work, then you have a simple choice...
1. agree to work like that
2. persuade them otherwise
3. walk away

The second option is unlikely to happen in the short term - and would require them to realise that yours is the only offer likely to be on the table.

MaryNB

My offer was accepted but they refused to mark the house as SSTC until I got my mortgage offer. It was very frustrating. Worked out in the end though. Hoping to exchange next week.

FinallyStoppedLurking

As vendors they can do what they want. Only you can decide if you are willing to jump through their hoops.

amandacat

It might be they have been let down before. It’s happened to me several times where the buyer couldn’t get the mortgage on full application. On the other hand they could be keeping it on the market with the hope of a better offer and if they do, will drop you. 
The thing is they haven’t accepted your offer, just said they’re seriously considering it. This would put me off personally if I was buying it because you’re applying for a mortgage on a property where your offer hasn’t been formally accepted. 

safwan19

Yeah it makes no sense applying for mortgage application when my offer is accepted I think I will leave this property. I am surprised there is nothing stopping estate agents to do all this. They can simply sell property whoever they want

Suseka97

Do you have a 'decision in principle' for your mortgage?  

We were not able to submit the full application (to Nationwide) until we had an offer accepted and even if you can do that, depending on who the lender is (if you read on the mortgages and endowment thread) it can take quite a while to get that actual offer in your hands.  I also wouldn't be looking to get a valuation done (and paid for) without some assurances that the vendor was likely to accept your offer.

Adrian C has pretty much summarised your options and I'd be trying to understand why they are insisting on your having the mortgage offer first, there could be a good reason.  Building a rapport between a buyer and seller is always helpful - but I appreciate that's difficult in the current climate.

Also, I guess one question is how much do you want this house - is it worth jumping through their hoops.  You could also say to the EA that if they won't accept the offer, you'll keep looking at other houses.  It's a two-way street.

caprikid1

I know it sounds risk and a pain but it does actually change nothing legally just in your head. If they accept your offer they are not bound to sell to you.

safwan19

Suseka97 said:

Do you have a 'decision in principle' for your mortgage?  

We were not able to submit the full application (to Nationwide) until we had an offer accepted and even if you can do that, depending on who the lender is (if you read on the mortgages and endowment thread) it can take quite a while to get that actual offer in your hands.  I also wouldn't be looking to get a valuation done (and paid for) without some assurances that the vendor was likely to accept your offer.

Adrian C has pretty much summarised your options and I'd be trying to understand why they are insisting on your having the mortgage offer first, there could be a good reason.  Building a rapport between a buyer and seller is always helpful - but I appreciate that's difficult in the current climate.

Also, I guess one question is how much do you want this house - is it worth jumping through their hoops.  You could also say to the EA that if they won't accept the offer, you'll keep looking at other houses.  It's a two-way street.

Yeah completely agree with you. Spoke to my broker even he said he will struggle to get mortgage offer with a offer accepted letter
The property is ideal for what I am looking for but it is not worth the hassle

Thanks mate

Linton

safwan19 said:

Yeah it makes no sense applying for mortgage application when my offer is accepted I think I will leave this property. I am surprised there is nothing stopping estate agents to do all this. They can simply sell property whoever they want

It will almost certainly be the vendor, not the EA.  It is in the EA's interest to get the place sold asap so they can get their commission with minimal effort and spend more time on selling more houses.  In this case the EAs interests are the samer as yours. Perhaps a sensible discussion with the EA may get them to persuade the vendor to relax the requirements or agree a compromise.