Need advice

GDB2222

kiwi07 said:

GDB2222 said:

kiwi07 said:

eddddy said:

kiwi07 said:

eddddy said:

kiwi07 said:

RAS said:

Walk away.

That is why this agent is so cheap 75% plus vat - because there is a catch! 

I'd be pretty certain it's just badly written contract wording by the estate agent. Phone them and ask, and then get it clarified by email.

Most estate agents are members of the Property Ombudsman Scheme (TPOS) which specifies what an estate agent's contract must say.

In fact, assuming the estate agent is a member of TPOS, and you complain to TPOS, the TPOS rules will override what the estate agent's contract says.

Here's an extract from the TPOS rules:

Fee Entitlement and Client Liability

5t At the time of receiving instructions from a seller you must:

• point out and explain clearly in your written Terms of Business that you may be entitled to a commission fee if that seller terminates your instruction and a memorandum of sale is issued by another agent to a buyer that you have introduced (see definition of effective introduction (*) and supplementary TPO ‘Dual Fee’ guidance) within 6 months of the date your instruction ended and where a subsequent exchange of contracts takes place.

• If no other estate agent is involved this time limit extends to 2 years.
  

Link: https://www.tpos.co.uk/images/codes-of-practice/TPOE27-8_Code_of_Practice_for_Residential_Estate_Agents_A4_FINAL.pdf

I strongly suspect that somebody at the estate agents has just made a mess of paraphrasing the above.

So TPOS confirms that if I sell my property without a new agent, so assuming privately, during 2 years after termination of contract, first EA can still claim their commission? 

No. Maybe it's easier using an example...

• The EA introduces a potential buyer named Sam Smith (e.g. the EA arranges a viewing for Sam Smith)

• Sam Smith doesn't make an offer

• Then you terminate the EA's contract on 1st March 2025

• If Sam Smith changes their mind and buys your house through another EA within 6 months (i.e. before 1st September 2025) - you have to pay the first EA a fee

• If Sam Smith changes their mind and buys your house without another EA being involved within 2 years (i.e. before 1st March 2027) - you have to pay the first EA a fee

But that only applies to Sam Smith, or other people introduced before 1st March 2025 by the first EA (or another EA).

It doesn't apply to anyone introduced after 1st March 2025 (or to any buyer you found privately).


For example, if you move to a new estate agent on 2nd March 2025, and they introduce somebody named Alex Green on 2nd March 2025 and Alex Green goes on to buy your house - you don't have to pay the first EA a fee.


All the above is completely standard, and you will find those terms in the vast majority of estate agents' contracts.

 

Thanks for explanation. May be EA got the wording wrong as it looks like they try to implement Sole selling right for a period of 2 years after termination disregarding if a buyer was first introduced by them or not.

Quick question- what is so good about this agent that you want to use them? Is it just that they are cheap?

Is it a new firm, or have they been around for years, with a solid track record? 

There’s clearly a mistake in the wording of their contract. If they thank you for pointing it out, and immediately agree to alter it, that’s a positive thing. If they refuse, I would not use them. 

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

It doesn't sound like he's understood the point. 

kiwi07

GDB2222 said:

kiwi07 said:

GDB2222 said:

kiwi07 said:

eddddy said:

kiwi07 said:

eddddy said:

kiwi07 said:

RAS said:

Walk away.

That is why this agent is so cheap 75% plus vat - because there is a catch! 

I'd be pretty certain it's just badly written contract wording by the estate agent. Phone them and ask, and then get it clarified by email.

Most estate agents are members of the Property Ombudsman Scheme (TPOS) which specifies what an estate agent's contract must say.

In fact, assuming the estate agent is a member of TPOS, and you complain to TPOS, the TPOS rules will override what the estate agent's contract says.

Here's an extract from the TPOS rules:

Fee Entitlement and Client Liability

5t At the time of receiving instructions from a seller you must:

• point out and explain clearly in your written Terms of Business that you may be entitled to a commission fee if that seller terminates your instruction and a memorandum of sale is issued by another agent to a buyer that you have introduced (see definition of effective introduction (*) and supplementary TPO ‘Dual Fee’ guidance) within 6 months of the date your instruction ended and where a subsequent exchange of contracts takes place.

• If no other estate agent is involved this time limit extends to 2 years.
  

Link: https://www.tpos.co.uk/images/codes-of-practice/TPOE27-8_Code_of_Practice_for_Residential_Estate_Agents_A4_FINAL.pdf

I strongly suspect that somebody at the estate agents has just made a mess of paraphrasing the above.

So TPOS confirms that if I sell my property without a new agent, so assuming privately, during 2 years after termination of contract, first EA can still claim their commission? 

No. Maybe it's easier using an example...

• The EA introduces a potential buyer named Sam Smith (e.g. the EA arranges a viewing for Sam Smith)

• Sam Smith doesn't make an offer

• Then you terminate the EA's contract on 1st March 2025

• If Sam Smith changes their mind and buys your house through another EA within 6 months (i.e. before 1st September 2025) - you have to pay the first EA a fee

• If Sam Smith changes their mind and buys your house without another EA being involved within 2 years (i.e. before 1st March 2027) - you have to pay the first EA a fee

But that only applies to Sam Smith, or other people introduced before 1st March 2025 by the first EA (or another EA).

It doesn't apply to anyone introduced after 1st March 2025 (or to any buyer you found privately).


For example, if you move to a new estate agent on 2nd March 2025, and they introduce somebody named Alex Green on 2nd March 2025 and Alex Green goes on to buy your house - you don't have to pay the first EA a fee.


All the above is completely standard, and you will find those terms in the vast majority of estate agents' contracts.

 

Thanks for explanation. May be EA got the wording wrong as it looks like they try to implement Sole selling right for a period of 2 years after termination disregarding if a buyer was first introduced by them or not.

Quick question- what is so good about this agent that you want to use them? Is it just that they are cheap?

Is it a new firm, or have they been around for years, with a solid track record? 

There’s clearly a mistake in the wording of their contract. If they thank you for pointing it out, and immediately agree to alter it, that’s a positive thing. If they refuse, I would not use them. 

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

It doesn't sound like he's understood the point. 

Or just if he is simply ignoring that fact...

eddddy

kiwi07 said:

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

I don't see a need to "officially amend" the contract.

I'm pretty sure that the email clarification of the contract will be good enough for any court.  Especially as you also have the option to complain to TPOS.

But if I was to be pedantic, the email mentions "interested parties". The term "interested parties" does not appear anywhere else in the contract, and it's meaning isn't defined.



In your position, I would reply with something like this (i.e. removing the reference to "interested parties")...

I am happy to proceed with instructing you on the understanding that paragraph 1 b means...

"when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to someone we introduced, via another agent, then our fee will become liable. " 

(It's bad English, but it's what the estate agent wrote!)

And for extra reassurance, write on the contract "subject to my email dated xx/01/2025, as attached", before signing the contract.

kiwi07

eddddy said:

kiwi07 said:

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

I don't see a need to "officially amend" the contract.

I'm pretty sure that the email clarification of the contract will be good enough for any court.  Especially as you also have the option to complain to TPOS.

But if I was to be pedantic, the email mentions "interested parties". The term "interested parties" does not appear anywhere else in the contract, and it's meaning isn't defined.



In your position, I would reply with something like this (i.e. removing the reference to "interested parties")...

I am happy to proceed with instructing you on the understanding that paragraph 1 b means...

"when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to someone we introduced, via another agent, then our fee will become liable. " 

(It's bad English, but it's what the estate agent wrote!)

And for extra reassurance, write on the contract "subject to my email dated xx/01/2025, as attached", before signing the contract.

Regarding interested parties he said "this is relevant if we were a larger firm (corporate) with other branches & we offered to promote your property in those branches. 

We dont have other offices, so its irrelevant."

Regarding the paragraph 1b - why they cant just crossed it out "b) if no other estate agent is involved,  an exchange of contracts takes place within 2 years of the date this agreement ended." Because my understanding they are saying something like that "our fee become payable if you sell your property within 2 years of termination to anyone disregarding if the buyer was first introduced by us or not". 

Because if they are not willing to admit bad wording so me thinking if this was intentional..

GDB2222

kiwi07 said:

eddddy said:

kiwi07 said:

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

I don't see a need to "officially amend" the contract.

I'm pretty sure that the email clarification of the contract will be good enough for any court.  Especially as you also have the option to complain to TPOS.

But if I was to be pedantic, the email mentions "interested parties". The term "interested parties" does not appear anywhere else in the contract, and it's meaning isn't defined.



In your position, I would reply with something like this (i.e. removing the reference to "interested parties")...

I am happy to proceed with instructing you on the understanding that paragraph 1 b means...

"when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to someone we introduced, via another agent, then our fee will become liable. " 

(It's bad English, but it's what the estate agent wrote!)

And for extra reassurance, write on the contract "subject to my email dated xx/01/2025, as attached", before signing the contract.

Regarding interested parties he said "this is relevant if we were a larger firm (corporate) with other branches & we offered to promote your property in those branches. 

We dont have other offices, so its irrelevant."

Regarding the paragraph 1b - why they cant just crossed it out "b) if no other estate agent is involved,  an exchange of contracts takes place within 2 years of the date this agreement ended." Because my understanding they are saying something like that "our fee become payable if you sell your property within 2 years of termination to anyone disregarding if the buyer was first introduced by us or not". 

Because if they are not willing to admit bad wording so me thinking if this was intentional..

The reality is that you are very unlikely to sell your home without the involvement of an agent of some sort. So, as a money-making exercise for this agent, it doesn't work. That's why I think it's unintentional. 

You can write to him, setting out in simple terms what you think the contract means in this respect, and ask him to confirm. 

kiwi07

GDB2222 said:

kiwi07 said:

eddddy said:

kiwi07 said:

EA responded by saying " this Is relevant when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to one of our interested parties/someone we introduced to the property, via another agent, then our fee will become liable. "

No offer to officially amend the contract...

I don't see a need to "officially amend" the contract.

I'm pretty sure that the email clarification of the contract will be good enough for any court.  Especially as you also have the option to complain to TPOS.

But if I was to be pedantic, the email mentions "interested parties". The term "interested parties" does not appear anywhere else in the contract, and it's meaning isn't defined.



In your position, I would reply with something like this (i.e. removing the reference to "interested parties")...

I am happy to proceed with instructing you on the understanding that paragraph 1 b means...

"when we work on a sole agency basis (standard for all agents) & should you disinstruct us & then proceed to sell the property within 2yrs of disinstruction, to someone we introduced, via another agent, then our fee will become liable. " 

(It's bad English, but it's what the estate agent wrote!)

And for extra reassurance, write on the contract "subject to my email dated xx/01/2025, as attached", before signing the contract.

Regarding interested parties he said "this is relevant if we were a larger firm (corporate) with other branches & we offered to promote your property in those branches. 

We dont have other offices, so its irrelevant."

Regarding the paragraph 1b - why they cant just crossed it out "b) if no other estate agent is involved,  an exchange of contracts takes place within 2 years of the date this agreement ended." Because my understanding they are saying something like that "our fee become payable if you sell your property within 2 years of termination to anyone disregarding if the buyer was first introduced by us or not". 

Because if they are not willing to admit bad wording so me thinking if this was intentional..

The reality is that you are very unlikely to sell your home without the involvement of an agent of some sort. So, as a money-making exercise for this agent, it doesn't work. That's why I think it's unintentional. 

You can write to him, setting out in simple terms what you think the contract means in this respect, and ask him to confirm. 

EA can easily cross that sentence out, especially if he is the only person in the agency, so he doesn't have to ask for the permission. If he doesn't want to loose the client..

eddddy

kiwi07 said:

Because if they are not willing to admit bad wording so me thinking if this was intentional..

You're over thinking this.

I think the bottom line is, the estate agent just isn't good at writing accurate English.

• His contract is badly written
• His email is badly written

Your  email exchange has clarified the the situation - so there really is no problem. You can go ahead.

kiwi07 said:

Regarding the paragraph 1b - why they cant just crossed it out "b) if no other estate agent is involved,  an exchange of contracts takes place within 2 years of the date this agreement ended." Because my understanding they are saying something like that "our fee become payable if you sell your property within 2 years of termination to anyone disregarding if the buyer was first introduced by us or not". 

Because crossing out that paragraph is the wrong solution.

A better solution could be to change the wording to something this:

"The agent will be entitled to a commission fee if the client terminates this agreement, and either

a) a memorandum of sale is issued by another agent to a buyer that the agent has introduced within 6 months of the date this agreement ended and where a subsequent exchange of contracts takes place , or

b) if no other estate agent is involved,  and an exchange of contracts takes place with a buyer that the agent has introduced, within 2 years of the date this agreement ended."


But this has been clarified by email. So you're good to go.

kiwi07

eddddy said:

kiwi07 said:

1. Marketing issues
The client agrees that details of the property may/will be circulated to the offices of members of ****** on a sub-agency basis and they will then also be authorised to offer the property for sale at no extra cost to the client. A sub - agent is defined as a person/agent who receives and acts upon instructions from a principal agent rather than directly from the seller. Remuneration will be by separate agreement between the agents concerned. 
Yes x   No x

Does anyone know what this is about?

You will be instructing Estate Agent A to sell your property.

Estate Agent A might pass details of your property to Estate Agent B, Estate Agent C etc - so that they can try to sell your property as well.

Estate Agent A will have agreements with Estate Agent B and Estate Agent C about how the 0.75%+vat would be split between them, if B or C find a buyer. It won't cost you any extra if B or C find a buyer.

I don't see a problem with that.

kiwi07 said:

2. Sole agency /joint sole agency. - liability to pay commission.
Where the agent acts on the clients behalf as sole agent /joint sole agent, the client will be liable to pay remuneration to the sole agent / joint sole agent , in addition to any other costs or charges agreed , if at any time unconditional contracts for sale of the property are exchanged:
1. With a buyer introduced by the agent during the period of the agents sole/joint sole agency or with whom the agent had negotiations about the property during that period or,
With a buyer introduced by another agent during that period. 
The agent will be entitled to a commission fee if the client terminates this agreement and either:
a) a memorandum of sale is issued by another agent to a buyer that the agent has introduced within 6 months of the date this agreement ended and where a subsequent exchange of contracts takes place , or 
b) if no other estate agent is involved,  an exchange of contracts takes place within 2 years of the date this agreement ended. 
Reference above to the exchange of contracts shall be deemed to include completion of a sale of the property where no contracts are exchanged. 

That is a completely standard 'Sole Agency Agreement'.

Any estate agent that offers 'Sole Agency' should have very similar wording in their contract.

I'm not sure which parts you're concerned about and/or don't understand, but in simple terms it means....

• If the estate agent finds you a buyer, you have to pay the estate agent a fee

• While your contract is running with this estate agent, you shouldn't use another estate agent as well. If you do, and the other estate agent finds a buyer - you'll probably have to pay a fee to both estate agents

• If this estate agent introduces somebody (e.g. arranges a viewing for somebody), and then you end the estate agent's contract - if that 'somebody' later buys your house, you still have to pay the estate agent a fee - for up to 6 months / 2 years.

Other things to look out for in the contract include...

• Is there any mention of a 'Ready Willing and Able' buyer? That can be a bit messy sometimes

• Is there any mention of fees that have to be paid if the property doesn't sell? Sometimes called 'Withdrawal fees', 'Termination fees', 'Marketing fees' etc.

• Is there mention of any other types of fees?

• How long is the 'Minimum Contract Period'? You should try to negotiate that down to about 8 weeks. (That means you can sack them after 8 weeks, if it turns out they are useless.)

8. Ready, willing and able buyer
A buyer is a ready, willing and able buyer if he is prepared and is in a position to exchange unconditional contracts for the purchase of the property. The client will be liable to pay commission to the agent, in the addition to any other costs or charges agreed, if such a buyer is introduced by the agent in accordance with your instructions and this must be paid even if you subsequently withdraw and contracts for sale are not exchanged, irrespective of the reasons."

eddddy

kiwi07 said:

A buyer is a ready, willing and able buyer if he is prepared and is in a position to exchange unconditional contracts for the purchase of the property. The client will be liable to pay commission to the agent, in the addition to any other costs or charges agreed, if such a buyer is introduced by the agent in accordance with your instructions and this must be paid even if you subsequently withdraw and contracts for sale are not exchanged, irrespective of the reasons."

That's almost word for word what the regulations say:

Ready, willing and able purchaser

“READY, WILLING AND ABLE PURCHASER

A purchaser is a “ready, willing and able” purchaser if he is prepared and is able to [exchange unconditional contracts for the purchase of your property].

You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, if such a purchaser is introduced by us in accordance with your instructions and this must be paid even if you subsequently withdraw and [unconditional contracts for sale are not exchanged], irrespective of your reasons.”

Link: https://www.legislation.gov.uk/uksi/1991/859/schedule/made

I'm not keen on "ready, willing and able buyer" clauses in estate agent's contracts, because there is so much scope for arguing about what constitutes a "ready, willing and able buyer".

But it's often difficult to persuade estate agents to remove those clauses.

So I try to qualify the clause by adding a something like

"The buyer is only 'ready willing and able' if they are prepared to exchange contracts and complete within a reasonable timescale, and on the terms agreed when the offer was accepted. If the buyer demands a change in price, and/or demands any terms which were not stated when the offer was agreed, they are no longer 'ready, willing and able'."

 

GDB2222

Personally, I insist on only paying the commission if contracts are exchanged. That way, even if the buyer defaults I can pay the agent from the buyer’s deposit. 

I agree with Eddie. This agent is poor at writing clear English. But, that’s not what you are hiring him for.