EA delaying issue of sale memorandum

Nuddin4595

Hi all,

im in the process of buying and selling houses. Had an offer accepted on mine by an investor, and then shortly had my offer accepted on the property we wanted. The properties are with the same agents (different branches), and while things are finally looking positive for the purchase, our sale memorandum has taken almost a month to come. 

At first I was told this was due to the buyer not wanting it sent out due to waiting for a mortgage offer. Then I was told it’s because compliance are still waiting for them pass all checks, even though they have seen his proof of funds prior to the offer. A survey was booked a week after his offer was accepted, and it’s almost been 3 weeks since it was done. One agent said the valuation was fine but may require the buyer to pay a higher deposit, while the branch manager states they are chasing the survey outcome. 

I asked them to put the property on the market based on the fact that the buyer wasted most of the month without an update on his mortgage offer, instructing a solicitor or passing through compliance. Conveniently, these details came through overnight, and a sales memorandum was issued two days later (with incorrect details). In addition, the wording of this memorandum was different to my memorandum for the purchase, showing a price (subject to contract AND survey).

I’ve now asked about the buyers mortgage offfer and the valuation outcome (as it’s been almost 3 weeks) twice, and still no response. 

One agent also let it slip that he would be travelling from January to the end of Feb - conveniently when I expect all the legal work to occur..

I don’t understand how I can instruct agents to work for ME, only to keep having to overwork and triple check through things to ensure I’M the one not being screwed over.

Does anyone have any experience of why the agents may be doing this? Why delay the sales memorandum then lie about the valuation outcome. If your memorandums are automated and sent centrally, why would it be worded differently, and then the agent go quiet when clarifying the valuation outcome. My thoughts are that the investor is looking to string us along till we’re deep in the process, then reduce the price when it’s be most inconvenient, and the agents are facilitating this.

eddddy

Nuddin4595 said:

Does anyone have any experience of why the agents may be doing this? 

It sounds like your buyer is doing things in a slightly strange way - wanting to get a mortgage offer before they instruct a solicitor. That may be because...

• They're not sure if they can get a mortgage - based on their personal/financial circumstances
• They're not sure if the property is mortgageable
• They're looking for justification to reduce their offer
• They're slightly strange people 

The estate agent is giving you limited and sometimes wrong information. That may be because...

• They're not chasing the buyer effectively - so they don't know what's going on and making stuff up
• The buyer is refusing to tell them what's going on - so they're making stuff up
• Or I think least likely, there's some kind of conspiracy between the estate agent and the buyer

(Is this a 'conventional' estate agent who gets paid on completion, as opposed to one that's been paid in advance?)


In these kind of circumstances, sellers would sometimes decide to put their property back on the market. But realistically, that would be pointless at this time of year. You'd need to wait until January.

Nuddin4595 said:

Why delay the sales memorandum then lie about the valuation outcome. If your memorandums are automated and sent centrally, why would it be worded differently, and then the agent go quiet when clarifying the valuation outcome.

A key purpose of the Sales Memo is to tell you who the buyer's solicitor is. If the buyer hasn't instructed a solicitor, there's not much point in issuing the memo.

Are you sure that the 2 estate agencies are part of the same company? Many estate agency brands are run as franchises. So each branch can be a stand alone business, unconnected with any other branch. In that case, each branch might have different processes, different styles of sales memos etc.


I guess you need to push the estate agent to find out exactly what's going on, or maybe consider contacting the buyer yourself to ask them what's happening. (As long as you're fairly sure you can do that without it developing into a confrontation, argument, etc)

Hoenir

Sounds like your investor is intentionally playing games.  Probably continuing to view other property. Relist on the 2nd January. Market will pick up in the New Year. 

Nuddin4595

eddddy said:

Nuddin4595 said:

Does anyone have any experience of why the agents may be doing this? 

It sounds like your buyer is doing things in a slightly strange way - wanting to get a mortgage offer before they instruct a solicitor. That may be because...

• They're not sure if they can get a mortgage - based on their personal/financial circumstances
• They're not sure if the property is mortgageable
• They're looking for justification to reduce their offer
• They're slightly strange people 

The estate agent is giving you limited and sometimes wrong information. That may be because...

• They're not chasing the buyer effectively - so they don't know what's going on and making stuff up
• The buyer is refusing to tell them what's going on - so they're making stuff up
• Or I think least likely, there's some kind of conspiracy between the estate agent and the buyer

(Is this a 'conventional' estate agent who gets paid on completion, as opposed to one that's been paid in advance?)


In these kind of circumstances, sellers would sometimes decide to put their property back on the market. But realistically, that would be pointless at this time of year. You'd need to wait until January.

Nuddin4595 said:

Why delay the sales memorandum then lie about the valuation outcome. If your memorandums are automated and sent centrally, why would it be worded differently, and then the agent go quiet when clarifying the valuation outcome.

A key purpose of the Sales Memo is to tell you who the buyer's solicitor is. If the buyer hasn't instructed a solicitor, there's not much point in issuing the memo.

Are you sure that the 2 estate agencies are part of the same company? Many estate agency brands are run as franchises. So each branch can be a stand alone business, unconnected with any other branch. In that case, each branch might have different processes, different styles of sales memos etc.


I guess you need to push the estate agent to find out exactly what's going on, or maybe consider contacting the buyer yourself to ask them what's happening. (As long as you're fairly sure you can do that without it developing into a confrontation, argument, etc)

Hi @edddy

Thanks for your response. The agent is Bairstow Eves and they have completely stopped responding since I've asked for an update on the buyer's mortgage offer and valuation outcome. Not even a response regarding the error on the memorandum (put down the solicitors for the vendor of the property we're looking to buy).

The worst thing is this investor has no contact details anywhere on the wide web, even though I have his company details. The only way I could potentially make contact if I visit any of the registered addresses on companies house.

I think I'll chase it up again today and if they still cannot respond regarding the valuation outcome or mortgage offer, I know something is not right and I'll probably resume viewings in the new year. There is no way a level 1 valuation by Countrywide (the parent company for BE) would take 3 weeks to come back. At one point the agent said the lender was Nationwide and it may take a while because it was a buy-to-let, which I also do not believe as a) I am with Nationwide and had my offer notification on the same day of the valuation, and b) my broker said Nationwide do not typically deal with BTLs unless the investor is applying for a residential mortgage.

Tiglet2

Nuddin4595 said:

eddddy said:

Nuddin4595 said:

Does anyone have any experience of why the agents may be doing this? 

It sounds like your buyer is doing things in a slightly strange way - wanting to get a mortgage offer before they instruct a solicitor. That may be because...

• They're not sure if they can get a mortgage - based on their personal/financial circumstances
• They're not sure if the property is mortgageable
• They're looking for justification to reduce their offer
• They're slightly strange people 

The estate agent is giving you limited and sometimes wrong information. That may be because...

• They're not chasing the buyer effectively - so they don't know what's going on and making stuff up
• The buyer is refusing to tell them what's going on - so they're making stuff up
• Or I think least likely, there's some kind of conspiracy between the estate agent and the buyer

(Is this a 'conventional' estate agent who gets paid on completion, as opposed to one that's been paid in advance?)


In these kind of circumstances, sellers would sometimes decide to put their property back on the market. But realistically, that would be pointless at this time of year. You'd need to wait until January.

Nuddin4595 said:

Why delay the sales memorandum then lie about the valuation outcome. If your memorandums are automated and sent centrally, why would it be worded differently, and then the agent go quiet when clarifying the valuation outcome.

A key purpose of the Sales Memo is to tell you who the buyer's solicitor is. If the buyer hasn't instructed a solicitor, there's not much point in issuing the memo.

Are you sure that the 2 estate agencies are part of the same company? Many estate agency brands are run as franchises. So each branch can be a stand alone business, unconnected with any other branch. In that case, each branch might have different processes, different styles of sales memos etc.


I guess you need to push the estate agent to find out exactly what's going on, or maybe consider contacting the buyer yourself to ask them what's happening. (As long as you're fairly sure you can do that without it developing into a confrontation, argument, etc)

Hi @edddy

Thanks for your response. The agent is Bairstow Eves and they have completely stopped responding since I've asked for an update on the buyer's mortgage offer and valuation outcome. Not even a response regarding the error on the memorandum (put down the solicitors for the vendor of the property we're looking to buy).

The worst thing is this investor has no contact details anywhere on the wide web, even though I have his company details. The only way I could potentially make contact if I visit any of the registered addresses on companies house.

I think I'll chase it up again today and if they still cannot respond regarding the valuation outcome or mortgage offer, I know something is not right and I'll probably resume viewings in the new year. There is no way a level 1 valuation by Countrywide (the parent company for BE) would take 3 weeks to come back. At one point the agent said the lender was Nationwide and it may take a while because it was a buy-to-let, which I also do not believe as a) I am with Nationwide and had my offer notification on the same day of the valuation, and b) my broker said Nationwide do not typically deal with BTLs unless the investor is applying for a residential mortgage.

The Mortgage Works is a specialist Buy to Let subsidiary of Nationwide - perhaps that's who the agent meant?

Nuddin4595

Tiglet2 said:

The Mortgage Works is a specialist Buy to Let subsidiary of Nationwide - perhaps that's who the agent meant?

Thanks for this. Would it still be typical for them to take 3 weeks for a mortgage offer after a Level 1 valuation?

Tiglet2

Nuddin4595 said:

Tiglet2 said:

The Mortgage Works is a specialist Buy to Let subsidiary of Nationwide - perhaps that's who the agent meant?

Thanks for this. Would it still be typical for them to take 3 weeks for a mortgage offer after a Level 1 valuation?

I don't know the answer to that, but all the mortgage lenders will take however long they want to issue a proper offer.  They might need additional information, as you hinted in your opening post - the buyer may need to find additional funds for the deposit.  The mortgage offer will be delayed until the buyer can prove he has those funds. 

Level 1 surveys undertaken by the lender are for their own use - they don't usually show it to anyone, although it is sometimes attached to the buyers' solicitor's copy of the mortgage offer. 

If the EA can't answer your queries about the outcome of the valuation, it will probably be because they don't know it.  The lender is very unlikely to tell them.  The most they'd hear, would be that the valuation is fine or not fine.  You indicated in your opening post that it was fine.  So, perhaps the buyer needs to provide something else to the lender, which is between him and the lender.

The buyer may well undertake a survey themselves once the mortgage offer is issued and the transaction is off the starting block.  This could be a Level 2 or 3 survey that the buyer pays for and is for their own satisfaction.  This is what the EA means when they state that the offer is subject to contract AND survey.  If this survey suggests that there are major or urgent works needed to the property, the buyer may well want to renegotiate the price - that's what the sales memorandum is referring to. 

You say that the sales memorandum has now been sent to all parties.  The EA can only send this once they have details of the buyer, seller, and both solicitors.  It is not dependent on a mortgage offer. 

Sales memorandums do sometimes have mistakes on them, spellings of names, addresses etc.   It is not overly important - the EA knows it is not a legal document and all details will be verified/checked during the legal work done by the solicitors.  

Nuddin4595

Tiglet2 said:

Nuddin4595 said:

Tiglet2 said:

The Mortgage Works is a specialist Buy to Let subsidiary of Nationwide - perhaps that's who the agent meant?

Thanks for this. Would it still be typical for them to take 3 weeks for a mortgage offer after a Level 1 valuation?

I don't know the answer to that, but all the mortgage lenders will take however long they want to issue a proper offer.  They might need additional information, as you hinted in your opening post - the buyer may need to find additional funds for the deposit.  The mortgage offer will be delayed until the buyer can prove he has those funds. 

Level 1 surveys undertaken by the lender are for their own use - they don't usually show it to anyone, although it is sometimes attached to the buyers' solicitor's copy of the mortgage offer. 

If the EA can't answer your queries about the outcome of the valuation, it will probably be because they don't know it.  The lender is very unlikely to tell them.  The most they'd hear, would be that the valuation is fine or not fine.  You indicated in your opening post that it was fine.  So, perhaps the buyer needs to provide something else to the lender, which is between him and the lender.

The buyer may well undertake a survey themselves once the mortgage offer is issued and the transaction is off the starting block.  This could be a Level 2 or 3 survey that the buyer pays for and is for their own satisfaction.  This is what the EA means when they state that the offer is subject to contract AND survey.  If this survey suggests that there are major or urgent works needed to the property, the buyer may well want to renegotiate the price - that's what the sales memorandum is referring to. 

You say that the sales memorandum has now been sent to all parties.  The EA can only send this once they have details of the buyer, seller, and both solicitors.  It is not dependent on a mortgage offer. 

Sales memorandums do sometimes have mistakes on them, spellings of names, addresses etc.   It is not overly important - the EA knows it is not a legal document and all details will be verified/checked during the legal work done by the solicitors.  

Thanks for this. I totally understand that there may be errors in the memorandum - my solicitors are fine with it as they have what they need. I also understand that not every mortgage application is straightforward.

My issue is not getting a straight response from the EA who are selling the house for me, getting different responses from different agents and then when asked to clarify, getting no response. For e.g., why not mention if the valuation is fine and the offer still needs approving rather than have two different narratives. Or clarify that he wants to do a homebuyers (if he did).

Instead, all I've got is a) valuation was fine but buyer requires a higher deposit, b) valuation is still being chased, c) buyer will be traveling for two months when things are most crucial to get this done before April and d) no answer about his mortgage being accepted. 

When you put the above 4 points together, the other minor ones e.g., memorandum delay, memorandum errors, wording including 'survey' are all just additional reasons to be doubtful/suspicious. I was hoping the EA would be better suited to telling me that this buyer is or isn't in the best situation to give you the price he has offered in time for April. But I guess this is too much to ask for from people who are getting %1.25 of your house sale!

Tiglet2

The EA is not acting on behalf of the buyer though.  The buyer or his lender is not obliged to tell anything to the EA that the EA doesn't need to know.  I would suggest that the EA hasn't been told anything regarding the valuation and they are just guessing what the delay is and providing you with a possible reason for the delay, but they really don't know.

Tracet74

A Level 1 is not a valuation.  This is a survey which is normally undertaken by a buyer.  If this is a buy-to-let purchase, the lender may require one but each case is different.