EA won't put my offer forwards ("Reckless offer")

Bunnymahoney

Hi 

I tried to make an offer on a BTL property this morning, but the EA has said it is a legal requirement to have an agreement in principle to progress the offer. 

I have offered proof of funds (more than enough for the deposit and legal fees), and can prove that we just had a mortgage offer expire because the seller pulled out right at the last minute, and that offer has now (just) expired. The last 2 properties I offered an had accepted earlier in the year were completed without the AIP being in place and by providing proof of funds. I also can't find much by Googling this legal term he informs me is a "reckless offer". 

I am trying to get hold of my IFA to get the AIP in place ASAP as I don't want to lose out on this property, but I hadn't come across this before and wondered what other peoples' experience of this is? Thanks

AdrianC

You have a (6mo+?) offer on a different property.
That doesn't mean you'll get an AIP now - your circumstances may have changed.

Until such time as you can demonstrate that you can indeed borrow the purchase price, then of course the EA is entitled to view you as not being a viable buyer.

So get an AIP. Then your offer will be taken seriously. You may, of course, miss this particular property.

Is there a good reason you won't work with the EA's own mortgage broker to tick that AIP box off? You don't have to actually take their mortgage if you can find a better deal elsewhere, of course.

Tiddleshalifax

Due to the financial situation of many at the moment, a lot of estate agents won’t even consider letting someone view who doesn’t have an AIP. Deposit doesn’t prove anything - and an expired AIP I’m afraid is as good as a chocolate fireguard.

I don’t believe that’s an official term but in essence it could be considered reckless as if the vendor accepts it, the EA haven’t done their job in ensuring affordability 

newsgroupmonkey_

It's not a legal requirement at all. What a load of bobbins.

I'd ask to speak to the slimy person's manager and consider reporting them to whichever body they belong to.

They could say that it's their practice, which is fine - anyone can make up any rules of how they conduct business, but legal? No.

In fact, BY LAW (and now let's start quoting law back at them)...

"By law estate agents have to pass on every offer they receive to the seller, however ridiculous. Some buyers try and unnerve sellers by putting in very low initial offer"

Make sure it's in writing. The EA may well tell the vendor to ignore your offer because they're not convinced you have the funds, but if you make it clear you've requested an MIP, that would be a moot point.

user1977

newsgroupmonkey_ said:

In fact, BY LAW (and now let's start quoting law back at them)...

"By law estate agents have to pass on every offer they receive to the seller, however ridiculous. Some buyers try and unnerve sellers by putting in very low initial offer"

That's not a law you've quoted, is it?

Bear in mind it's entirely possible that their client has asked them not to trouble them with offers which don't meet certain criteria.

Bunnymahoney

Thanks all - just to confirm, the offer was in writing and only £5k short of asking price. 

grumiofoundation

You can get an AIP online in a few minutes, you don’t need an IFA to get one.

Bunnymahoney

Thanks all - speaking to my IFA he says that during the height of COVID many EAs were asking for AIP or proof of funds so as not to show properties to non-proceedable buyers, but most had stopped that practice now. 

He agrees that this is nonsense (i.e. not a legal requirement) and they should present my offer, that's its probably a tactic to get me to use their IFA. Getting it sorted via my IFA now...thanks all 

AdrianC

Bunnymahoney said:

Thanks all - just to confirm, the offer was in writing and only £5k short of asking price. 

But with no proof you can afford it, it could have been for more than the asking price for all it's worth.

StandingInTheSun

It's not a legal requirement at all.

onylon

Bunnymahoney said:

Thanks all - speaking to my IFA he says that during the height of COVID many EAs were asking for AIP or proof of funds so as not to show properties to non-proceedable buyers, but most had stopped that practice now. 

He agrees that this is nonsense (i.e. not a legal requirement) and they should present my offer, that's its probably a tactic to get me to use their IFA. Getting it sorted via my IFA now...thanks all 

You could probably get an AIP in 15 mins from whichever bank your current account is with. Its a simple online form, there's no hard credit check or obligation to take your application any futher.