Estate Agent Contract

gelato_cat

20122013 said:

gelato_cat said:

20122013 said:

gelato_cat said:

If they themselves sell your house, have they quoted you a fixed fee, or a percentage of the sale price for that? 

Clause B in your post above is fairly standard, although I've never seen a contract that quotes a minimum fee.

I've never seen anything like Clause A. For the avoidance of doubt, I think they need to specify the names of these "sub agents" and you also need a time limit to be specified. Eg you go with XXXX Estate Agents Limited, they don't sell it so eight months later you go with, and sell through, YYYY Estate Agents Limited, who was also a "sub agent" and brought some potential buyers to you previously. Under that clause, you need to make sure XXXX can't claim that the buyer came through YYYY during the time they were a "sub agent".

During valuation,  I was told  it was a fixed fee (not pecentage). However, in the valuaition email the fee went up and says 'MIN FEE'.  I had highlighred the fee is different and asked to see the TCs I was told a blank copy will be sent. I received a copy with completed details including the fee still unchanged and he did not want to increase the asking price. I am realstic and know the value. I did manage to get the asking price change (which I am happy with), later another simiilar property was listed at a higher price. The agent wanted to match that asking price.. (Due to Limited choices of 'able' agents, I will see how the negotiation goes and then decide). 

I'm curious as to why you've picked this agent. I think I'd be going with a different agent with a clearer contract.

There are a lot of  (10?) agents in the area and I have decided to instruct this one as they seem most transparent and now the area well  (I did say they did not want to increase the asking price but did get there in the end.  I was unsure when I pointed out another matter which I know it was due to the numbers they had used but they did not acknowledge that (not big deal at this point   On the other hand the other (5) agents valued the asking price for 5-  12% higher etc. and I am not sure who will be showing the viewers around with this agent I know who will be doing the viewings, Be interested to hear your views as may highlight things I am not seeing

My views are:

* Don't sign a contract you don't understand
* Given what you've said about their stated fees, they don't seem very transparent to me

theartfullodger

The only certain way of finding out what the agreement/clauses mean is if it gets to court and a judge rules.

Until then agent (or client) can tell what they THINK it means (unlikely always the same) but - who knows...

Could get a barrister's opinion but even that ain't certain.

Same as most terms/agreements... It's quite easy to write an unenforceable clause...

20122013

Next part of the TC reads:

'PAYMENT OF FEES:fees are due on exchange of contracts.the vendor will give his/her authority to the solicitors appointed at the time of sale to pay out of the proceeds of sale XXXX estate agents limited fees plus vat in accordance with the conditions herein agreed.  interest may be charged at the rate of 8% Natwest base rate if the account remains outstanding for more than seven days after completion. if during the sole agency a buyer is introduced by any other agent or source, these fees are still payable to XXXX estate agents limited. no charge will be made unless a buyer is introduced before the termination of the agreement and that buyer eventually purchases the property. '

I am unsure with some of this clause (see bold) 

1/ the way the interest rate is calculated? is this correct ? as I am used to seeing it as x %  above BOE rate?

2/ 'no charge will be made unless a buyer is introduced before the termination of the agreement and that buyer eventually purchases the property. '

Bookworm105

20122013 said:

Next part of the TC reads:

'PAYMENT OF FEES:fees are due on exchange of contracts.the vendor will give his/her authority to the solicitors appointed at the time of sale to pay out of the proceeds of sale XXXX estate agents limited fees plus vat in accordance with the conditions herein agreed.  interest may be charged at the rate of 8% Natwest base rate if the account remains outstanding for more than seven days after completion. if during the sole agency a buyer is introduced by any other agent or source, these fees are still payable to XXXX estate agents limited. no charge will be made unless a buyer is introduced before the termination of the agreement and that buyer eventually purchases the property. '

I am unsure with some of this clause (see bold) 

1/ the way the interest rate is calculated? is this correct ? as I am used to seeing it as x %  above BOE rate?

2/ 'no charge will be made unless a buyer is introduced before the termination of the agreement and that buyer eventually purchases the property. '

1 I think you have missed out the word plus
Where a late payment penalty is charged on a consumer facing contract, the rate is whatever the contracts says (but cannot be punitive). In contrast, on business to business contracts, it is set at 8% plus bank of England base rate. These EA appear to bank with Nat West, so to avoid any question of being punitive, they use that % but tied to Nat West base rate. All very standard stuff.

The chances of the money being paid over late and therefore incurring interest is slim to non existent. You would have grounds to seek redress from your conveyancer as that is their responsibility to process anyway.


2. as explained already, all prospective purchasers must come via that agency. The agent will keep a list of names of people they showed the property to. At the end of the sole agency period, if you then contract with another EA but one of the people on that list then comes back and buys the property "through" the other agency, you accept that said person was "introduced" to the property by the first agent, so the first agent has a right to fees for having done so, even though the contract period with the first EA has ended. 

That is core to the meaning of sole agency and is how every agency operates. All EA are red hot on this and if you were to go to a new agent at the expiry of this contract that new agent will ask for the list so they don't waste time and their own money dealing with a purchaser from the original agency 

that right to claim their fees continues ad infinitum as long as the actual purchaser first "saw" the property through the original EA, Consequently EA are known to scour sold lists to collate the purchaser name and to check that against their own introduction records so they can make a claim long after the sale may have completed. It is precisely why you as the seller need to be very careful to ensure the list of why they introduced is accurate if they ditch that EA and switch to another. All very standard stuff.

20122013

Bookworm105 said:

'1 I think you have missed out the word plus'

Good point and I have checked and there is no 'plus' in that clause. I will ask but if the agent does not amend it will be as it wil be an unlikely event.