Lied to about “cash buyer with no chain” .

helzbelz1984

Hi , I’m looking for advice re. house selling and estate agents. We put our house for sale in June &, within the first week ,we had 6 viewings and of these we had 2 offers above the asking price. The offers were similar , price-wise , but as one of the buyers was (supposedly!) a cash buyer with no property to sell and no chain, we accepted her offer. We’re also not in a chain as we own another property in another city that we rent to lodgers and so we planned to move there. Given that there was no chain etc , we thought it would be a quick sale and so moved everything to our other house. Our lodgers moved out and so we were paying for both mortgages , bills etc . It was expensive but we thought we could just about manage it for couple of months because our estate agent and solicitors assured us that our sale wouldn’t take long . Anyway things dragged on for months and after doing my own detective work , I found out that our buyer actually DID have a house to sell and that it had only just been reduced in price at the beginning of October ! Her estate agent  said that she had had a buyer but they’d  pulled out in May - ie before she put the offer on our house. Our estate agent said  she didn’t know her house sale had fallen through (which I don’t believe for a second obviously)!

So we put our house back on the market but ofc no one really wants to buy a house at the moment - we’ve had hardly any viewings and our estate agent has recommended we reduce the price by 10k (the house was previously valued at 200k so 10k is quite a difference!). I’ve made a formal complaint to the estate agents and am hoping to get our fees refunded especially if we can no longer find a buyer . If they won’t refund us then I’ll go to the property ombudsman, but is there anything else we can do ? Do estate agents have a legal obligation to conduct financial checks on buyers ? We’ve now got a lodger back in our other house to help cover some (not all) of the costs of bills etc , but the mortgage for the house we’re selling ends in March & so I’m getting desperate to sell quickly to avoid the extortionate interest rates. However we also can’t really reduce the price of our house yet b/c the agents said that if we change the price then this would void their money back guarantee policy! Feel like I’m stuck between a rock and a hard place - any advice would be very much appreciated! Thanku so much !

Upcycling_Queen

Unfortunately the EA has absolutely no right to pry into a persons affairs. They come out with it that they need to know but they have no legal right. Also they must put forward any offers in writing to you legally.

TO be honest if I was interested in a property (just moved but two fell through after we’d paid for surveys), I would happily offer up my details so the vendor knew I was serious.

youth_leader

I believe the EA does have to get proof of funds when an offer is accepted, following the money laundering directive in 2020.

This article is self explanatory

The Estate Agent has asked me for proof of funds. Why? And do I have to provide them? - Alexander JLO - A Highly Respected Firm of London Solicitors (london-law.co.uk)

jj_43

Simply the buyer made an offer to you which they couldn’t meet, and you are now a motivated seller. Not sure why you care about some money back guarantee policy? Take the property off the market if you have a choice. 

user1977

Even if the EA did check the funds (and it’s not clear from the OP that they didn’t), they can’t stop the buyer from changing their mind and deciding they only want to proceed if they sell their property.

Upcycling_Queen

youth_leader said:

I believe the EA does have to get proof of funds when an offer is accepted, following the money laundering directive in 2020.

This article is self explanatory

The Estate Agent has asked me for proof of funds. Why? And do I have to provide them? - Alexander JLO - A Highly Respected Firm of London Solicitors (london-law.co.uk)

user1977 said:

Even if the EA did check the funds (and it’s not clear from the OP that they didn’t), they can’t stop the buyer from changing their mind and deciding they only want to proceed if they sell their property.

I didn’t know this and found the EA’s a bit intrusive. Thank you.

housebuyer143

If your contract with the agent says that they will vet the buyer for suitability then that is what they should do. That means getting ID, mortgage in principle if they have one or proof of funds if they don't. 
If they didn't do this and your contract says they should have then they are in breach and you should be due some compensation.

To say though, did any legal work take place in 3 months? Surely that would have been a red flag? Did you ask the agent to chase the chain at any point? 

The agent if they accept liability are not likely to cover any of your expenses for the other house. You chose to evict your lodgers long before anyone had exchanged. Sales can fall through at any time so that is a risky thing to do.
If they did check funds and the buyer changed their mind there isn't much you can do. Potentially they planned to rent the house they had to break the chain then decided against it. The agent should have picked up somewhere along the lines though that the sale wasn't moving though. 

trakky14

If they did no legals in all that time surely you questioned it?? No survey etc?

newsgroupmonkey_

Just as an aside, you have a tenant in your house, not a lodger.

There's a huge difference, particularly if the tenant doesn't want to leave at the end of the term. It could take 6 months or more to evict them.

BikingBud

newsgroupmonkey_ said:

Just as an aside, you have a tenant in your house, not a lodger.

There's a huge difference, particularly if the tenant doesn't want to leave at the end of the term. It could take 6 months or more to evict them.

But they've moved out so a moot point.

BikingBud

helzbelz1984 said:

Hi , I’m looking for advice re. house selling and estate agents. We put our house for sale in June &, within the first week ,we had 6 viewings and of these we had 2 offers above the asking price. The offers were similar , price-wise , but as one of the buyers was (supposedly!) a cash buyer with no property to sell and no chain, we accepted her offer. We’re also not in a chain as we own another property in another city that we rent to lodgers and so we planned to move there. Given that there was no chain etc , we thought it would be a quick sale and so moved everything to our other house. Our lodgers moved out and so we were paying for both mortgages , bills etc . It was expensive but we thought we could just about manage it for couple of months because our estate agent and solicitors assured us that our sale wouldn’t take long . Anyway things dragged on for months and after doing my own detective work , I found out that our buyer actually DID have a house to sell and that it had only just been reduced in price at the beginning of October ! Her estate agent  said that she had had a buyer but they’d  pulled out in May - ie before she put the offer on our house. Our estate agent said  she didn’t know her house sale had fallen through (which I don’t believe for a second obviously)!

So we put our house back on the market but ofc no one really wants to buy a house at the moment - we’ve had hardly any viewings and our estate agent has recommended we reduce the price by 10k (the house was previously valued at 200k so 10k is quite a difference!). I’ve made a formal complaint to the estate agents and am hoping to get our fees refunded especially if we can no longer find a buyer . If they won’t refund us then I’ll go to the property ombudsman, but is there anything else we can do ? Do estate agents have a legal obligation to conduct financial checks on buyers ? We’ve now got a lodger back in our other house to help cover some (not all) of the costs of bills etc , but the mortgage for the house we’re selling ends in March & so I’m getting desperate to sell quickly to avoid the extortionate interest rates. However we also can’t really reduce the price of our house yet b/c the agents said that if we change the price then this would void their money back guarantee policy! Feel like I’m stuck between a rock and a hard place - any advice would be very much appreciated! Thanku so much !

If you are now in the house that you want to be in, can you rent the one you moved out of?

This may require notification to your mortgage providers, you will need to check the T&Cs of the 2 loans.