The tricks estate agents play on buyers
The tricks that Estate Agents play – Buyers
You must speak to our broker first!
This is one of the most common complaints from buyers, this tends to happen with some of the larger chains, who are only concerned with extracting as much as possible from the buyers, it is not about offering advice, it is about generating business for their in-house mortgage broker, which will in turn, earn them a handsome share of the commission, if the buyers use this route to get a mortgage.
The rules from the FCA are very strict, there should be no canvassing for any financial services, and although this is not always deemed to be ‘canvassing off trade premises’ it is a grey area at best, but at worst it is unethical and borders on bending, if not breaking the law. In this instance, the best course of action is to refuse and inform the seller. I have no doubt, that the average seller will not be happy, if you were to bring it to their attention that the agent has prevented a potential buyer from viewing their property and possibly making an offer, purely for their own benefit.
2. They refuse to take the property off the market, until your lender has instructed a surveyor.
This causes the buyer severe stress, as it is normally out of their hands. The time it takes for the surveyor to be instructed varies by lender and sometimes the buyers have no choice, as they may be restricted in their choice of lenders by their criteria and may not have any other option.
The only requirement a professional agent should really make, is to ask you to instruct a solicitor. In my case, on the acceptance of an offer, I inform the buyers that I will take the property off the market as soon as they instruct the solicitor and receive confirmation that they have paid the search fees, which is in their hands to do so. This demonstrates commitment from the buyer, it means the process is under-way and at this point, it is fair to the buyers and the sellers.
3. Agents insist on contacting your broker
This is very common, agents insisting that they almost have the right to probe in to your finances, otherwise your purchase may be at risk. In the first instance, the mortgage broker works for you, if they were to divulge any information whatsoever, that would be in breach of the GDPR laws.
The only information that the agent should normally ask for is evidence that you have a decision in principle, which is once again, information that you should only provide, should you wish to. Once again, when an agent contacts your broker to it is not only unethical, it also borders on illegal.
4. Pushy tactics – Especially Developers
Do not allow yourselves to be pressured or harassed by agents, it’s always the same story:
- There is always another buyer.
- There is always a reason that you may lose the house.
- You don’t have time
- You need to call your broker
- You need to chase your solicitor
This is little more than professional bullying!
They don’t want you to have time to reconsider, they want you to be so preoccupied with not losing the house, that you do not stop to question if whether you should be going ahead or not.
Think double Glazing salesmen,
In the old days, they would sit in your home and not leave until they either got a signed order (and a deposit) or if they were thrown out.
This is to pressure you to avoid you reconsidering, it is why the ‘cooling off period was introduced for most contracts. They want to avoid losing the deal due to ‘post purchase remorse’
Let’s pick on surveyors!
Selling at auction requires a seller’s pack, to include searches and all information, BEFORE the auction, should surveys be instructed by the buyer, before coming to market? This would definitely make the process faster and much less stressful, it would not only protect the buyers from paying more than one valuation fee, the successful buyers could reimburse the sellers for the cost of the fee on completion.
Many lenders would object, but as all surveyors are required to be RICS registered, does that indicated a lack of faith in the system?
This leads me to another question, if so many properties are down-valued, why is it that new homes, which are invariably more expensive are seldom down-valued? How do developers manage to get such high valuations?
Here is some food for thought, I have heard it first-hand, directly from surveyors, that when they value new properties, especially those on sale by large developers, they are actually too scared to down-value them.
The reality is, that where the surveyor’s opinion differs from the developers, they face a barrage of threats, comparisons (presented by the developer of course) and threats of legal action to pursue losses, if the valuation results in the loss of a sale.
Many of these high end developments in London had significantly lower valuations, but the developers responded with so much force that the surveyors buckled and subsequently went along with the asking price.
If you are a first time buyer, this could be catastrophic, especially now, when we are facing rising interest rates and falling prices. It could result in you buying a home that will put you in negative equity as soon as you complete, not only preventing you from selling, should you need to, but it will also restrict your options when you wish to look for another mortgage deal.
The moral of the story is, when is the valuation a valuation? Things are not always as they seem!