How can you confirm the buyer is financially qualified to proceed

20122013

I have been with my current estate agency for at least 10 months and it is going down hill due to continuous lies, no communications even within their team and providing details that belongs to other clients and the list goes on. Worse of it all, I had found out that the buyer mortgage appointment was two weeks after the offer was accepted (which I had to accept) I then found out that they had since cancelled that appointment and booked another for a few weeks later as they wanted another product. This sounds very odd to me. Could they not have discussed another product during that appointment? why cancelled, if you are keen on the property, I asked myself.

I have also discovered that even when I was speaking to the agency face to face they were still able to lie and gaslight me and still have to join all the dots for them so I can piece up the information. I was sucking it up as I would like the sale to go through but as said above I feel I am losing out all round.

As I now have my doubts about this sale, I would like to know 'How to confirm whether the buyer is financially qualified to proceed?' As the agent claims that the buyer has passed the agency checks (to me that does not mean they can get a mortgage as they are not using the agent's broker).. I had asked them to carry on with viewings and I have been told that is not possible as I have accepted the offer and I have now also asked whether the buyer is willing to show financial proof that they can proceed (instead of waiting for at least a few more weeks which there is a chance they will cancel and then rebooked to delay the sale).

My reason is that, if I was the Buyer, and got a great price I would have kept the mortgage appointment and make sure the agent let the Seller know that they are keen but that is just me.

The strange thing is that the Buyer had only viewed my property and then made their offer.. and when I asked the agent to ask for a higher offer (their comment was rude and I am unsure whether that was ever asked)

Is this a common practise amongst estate agents ? As I am no longer tie in with this agency and I do not feel this buyer is ready to proceed (and the solicitors have not had any communications - so the Buyer should not have a big bill) So when shall I end my agreement? asap? and find a new agent? or wait and see whether the Buyer is willing to provide proof of their finances?

elsien

I do wish people would stop using the term gaslighting quite so often on here for issues which are no such thing.

Aside from that, as you have completely lost faith in your estate agent just end the contract in line with the terms and conditions.

However as the estate agent has introduced the current buyer to you, if they are proceedable then you will still have to pay the agency fees again in line with the contract that you signed.

So read the contract and see what it says.

20122013

https://forums.moneysavingexpert.com/discussion/comment/81954023#Comment_81954023

Re: 'Gas lighting' I can see your point of view. This agent do try to make me doubt myself in to cover whatever they are lacking.

35har1old

https://forums.moneysavingexpert.com/discussion/comment/81954038#Comment_81954038

In my case it was the agent that saw prove of positive financial means

jones_guitar

Over the last weeks banks have been withdrawing products to increase interest rates.

Your estate agent would normally ask to see a mortgage in principle / proof of funds.

The mortgage might have been withdrawn and they needs to reapply.

This is normal in the market over the last weeks - which intern, will probably cause a slow down in sales.

bobster2

You are concerned that your buyer has not had a "mortgage appointment" with your estate agent? Is this one of these appointments where they try to convince the buyer to use their mortgage broker etc?

As a buyer I would never use a broker recommended by the seller's estate agent - I would simply show them the agreement in principle I have obtained elsewhere.

Jemma01

My agent asked to see proof of bank (for deposit) and my mortgage DIP before they presented the offer to the seller. They accepted my lower offer over the other person because they determined I was proceedable (had money in the bank ready for withdrawal). If you're sure the agent is lying, I'd wait for this sale to fall through and find another agent.

I don't see the agent sharing personal and financial details about their clients with you, there's no need for you to see those details, it is their job to assess and make determination of buyer's suitability.

Questions I'm sure you are already asking BEFORE accepting offers, on the phone, then make sure it is in writing as that would formally date the timeline:

• Have you seen a proof of deposit? How was that presented to you? (Dig into the details to find out if they're lying, e.g. is the fund coming from a single or multiple accounts? Obviously it doesn't matter from which accounts, but if they fumble, you know they're messing you around)
• Are the funds readily available? Not tied to an asset, or just about covering the deposit (since they still need to pay movers and solicitor fees at minimum)
• Have you verified the source of funds?
• Any unusual circumstances about the buyer? E.g. self employed, in job probation, or anything that could make their mortgage application harder. I'm self employed my first application took 1 week, 2nd with same papers took 2 5 weeks, it all depends on the skill of the underwriter.
• Check if they're in a chain. We've had our chain broken twice by the same person and when he broke it the 3rd time, we told him, empty the property or we're walking away. He emptied the property and moved into a rental.
• Whether AML/ID checks have been done before you're tied up to the contract. You should check what the terms and conditions are between you and the agent, what constitutes "proceedable"? What checks must they have done before that status is determined?

Good luck

RelievedSheff

Our agents required proof of our buyers proceed ability prior to our property being taken off the market and flagged as SSTC. Which was the same for our onward purchase as well.

In the current mortgage market though with mortgage products being withdrawn at short notice I'm not sure what use a DIP really is other than to show that in principle they can lend the money.

eddddy

20122013 said

I would like to know 'How to confirm whether the buyer is financially qualified to proceed?'

If the buyer is a 'first time buyer' (or has no property to sell) an estate agent would normally ask to see…

• Bank statements - to prove the buyer has the deposit
• Mortgage agreement in principle - which indicates that the buyer could get a mortgage

If the buyer has a property to sell, an estate agent would normally ask…

• To see a Mortgage agreement in principle - which indicates that the buyer could get a mortgage
• Details of the estate agent who is selling the buyer's property. They would then phone the estate agent to confirm that the buyer's property is under offer

20122013 said

As I now have my doubts about this sale…

Is your estate agent paid on exchange/completion?

If so, they should be as keen as you are to get your property to exchange of contracts - so they get their fee.

So even if your buyer is a bit 'flaky', presumably the estate agent thinks they're the best bet for getting the property to exchange of contracts quickly.

(But it might be different if you paid the estate agent in advance. Then they have no incentive to get to exchange of contracts.)

20122013 said

As I am no longer tie in with this agency and I do not feel this buyer is ready to proceed (and the solicitors have not had any communications - so the Buyer should not have a big bill) So when shall I end my agreement?

You can give notice of termination of the estate agent's contract now, if you want - most contracts require 2 or 4 weeks written notice.

Terminating the estate agent's contract shouldn't be a problem - but think more carefully about withdrawing from the sale.

i.e. The sale to your current buyer can continue, even though you've ended the estate agent's contract. And you'd have to pay the estate agent if the current buyer completes.

But if you withdraw from the sale… the estate agent might try to claim that the buyer was "ready, willing and able", and therefore demand their full fee from them.

If you want, you could try wring an email to the estate agent something like this:

"I don not believe that <name> is a ready, willing and able buyer. If you disagree please let me know, and explain your reasons.

My understanding is that:

• <name>'s solicitor has yet contacted my solicitor
• <name> doesn't yet have a mortgage agreement in principle
• <name> hasn't yet applied for a mortgage for my property
• <name. hasn't yet booked a mortgage valuation

Please address these points in your reply to me.

If I don't hear from you within 3 working days, I will assume that you agree that <name> is not a ready, willing and able buyer."

If you want, you could also add…

" Also, based on the above, I don't believe that <name> is a serious potential buyer, I wouldn't even describe them as proceedable.

Therefore I would like you to start remarketing my property, and it should remain on the market until <name> shows they are serious by booking a mortgage valuation."

horsewithnoname

a friend of mine had an AIP, then when they said they’d like to go ahead and borrow, the mortgage company refused to lend anywhere near the amount they’d said.
The broker attached to the EA got the mortgage needed and my friend is now a very happy homeowner paying less in mortgage than previously in rent.
obviously this caused a bit of delay, so maybe something like that happened? Just a thought.

Myci85

I may have missed this, but when did you accept this offer? And do you know if the buyer has even instructed a solicitor? That would usually be done immediately, even if they ask the solicitor to hold off doing any chargeable work until they have the mortgage offer, so that your solicitor can issue the memorandum of sale to their solicitor. Maybe ask your solicitor if this has been done?

As others have said, the fact they haven't gone ahead with their mortgage appointment isn't necessarily a reason to decide they're not proceedable, indeed most people on this forum advise against doing this, but if it has been weeks and no evidence of progress in any form, then I would be worried.