Is this legal ?

castle96

House is for sale through local branch of major Estate Agents. To be considered a "preferencial buyer" and take it off the market (they did), a £1000 fee is required to be paid to a stipulated solicitor named by Agent. For this you would get all local searches etc. Still allowed to use your own solicitor. Fee is not refundable or deducted from sale price at completion.
Have looked at Agents code of practice and find no reference to this either for/against. Another branch of same Agent has not heard of it either. Buyer was 'allowed' to use own mortgage broker and solicitor.  Thoughts please    TIA

??????

Chief_of_Staffy

It doesn't sound legal but that's moot. If it's as you'd say, you'd need a screw loose to deal with them, so in a way it's a good thing they make their disrepute so obvious.

Herzlos

Can you proceed without being a preferential buyer?

castle96

Good Q. It has been "taken off the market" but what if someone knows it hasn't completed and offers a higher price... The Agent HAS TO (Code of Practice), pass on the higher offer. Seller accepts..does person who has paid £1000 get it back? I know the person and will try to get a copy of what the original detail said

castle96

This property is offered for sale using the Committed Buyer process.
When an offer is accepted, the buyer will be required to make payment of a non-refundable fee of £996 including VAT (in addition to the final negotiated selling price). This will secure the transaction, and the property will be taken off the market.
As part of this fee, the buyer will receive a legal pack for the property (includes copy of register, title plan, searches, TA6, TA10) and £200 service credits for conveyancing, survey and removals via GOTO Group - see gotogroup.co.uk or email for more information.

castle96

Reservation-Fee-Guide.pdf

silvercar

castle96 said:

Good Q. It has been "taken off the market" but what if someone knows it hasn't completed and offers a higher price... The Agent HAS TO (Code of Practice), pass on the higher offer. Seller accepts..does person who has paid £1000 get it back? I know the person and will try to get a copy of what the original detail said

In practice, I would expect the estate agent to pass the offer on but say the buyer is unverified so they can’t vouch that the buyer is in a proceedable position. I would guess that the seller has paid something extra to be classified as a priority seller in some way. You a have to ask yourself why a seller would sign up to all this.

MeteredOut

Purely out of principle, I'd not be paying the vendors agent anything to submit an offer for a property, and I doubt I'm the only one.

user1977

Chief_of_Staffy said:

It doesn't sound legal

In what way wouldn't it be legal? I agree it's certainly not advisable, but not sure what would be unlawful about it.

Chief_of_Staffy

user1977 said:

Chief_of_Staffy said:

It doesn't sound legal

In what way wouldn't it be legal? I agree it's certainly not advisable, but not sure what would be unlawful about it.

I don't know whether it is or not, that's just my impression. I had the idea that an EA couldn't demand you use a specific solicitor, for any purpose, but I haven't researched it.

It seems to me a way of 'trapping' a buyer into making the purchase once they've put in an offer. In reality, the process we're forced to abide by means most of the pertinent information that informs a purchase cannot be obtained until after the offer is made, meaning that it's a cheap trick.

Chief_of_Staffy

Saw this on a listing I was looking at today.

You can secure the purchase today by paying an exclusivity fee of £2,000 which gives you the rights to purchase within a given timeframe. The exclusivity fee is returned to you upon successful completion of the property.

A processing fee of £200 is required in order to draw up an exclusive legally binding contract between the buyer and seller. This gives the buyer exclusive rights to purchase within a pre-agreed timeframe.

That sounds like a great deal. You pay the EA £2k for the privilege of having the property withdrawn from the market when an offer is accepted - the protocol of all honest agents and sellers across the land - and then you pay another £200, which isn't even refundable, for the privilege of you paying that £2k.

The wonderful EA in question is British Homesellers, National. Just so you know who to avoid.