BEWARE OF THE ESTATE AGENTS BREAKING THE LAW
Agents accused of ‘breaking the law’ with ‘conditional selling’ tactics, know your rights as a prospective buyer
Given that it is currently a seller’s market, many corporate agents are allegedly using people’s eagerness to buy and the sheer strength of demand in the market to sell in-house advice.
A growing number of independent mortgage brokers have expressed concerns in recent weeks to skyrocketing conditional selling practices at certain corporate estate agencies.
The negotiators at these agencies are accused of essentially intimating to prospective buyers that their offers to purchase a property will not be put forward for consideration to the seller unless they agree to additional in-house services offered, such as mortgage advice or legal services.
It is alleged that agents are claiming that they must ‘financially qualify’ buyers even though ‘all the customers in question had agreements in principle’. It is not a legal requirement to have a mortgage agreement in principle to view a property or make an offer to purchase a property.
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There is a mortgage broker who has a client prepared to go on the record about this practice and is building a case to present to the Association of Mortgage Intermediaries.
He commented: “I won’t mince my words: many agents are repeatedly breaking the law and don’t give a damn about it because clients are too scared to complain for fear of missing out on properties.
The same corporate estate agents crop up time and time again on the mortgage broker forums. In fact, I have evidence for the Association of Mortgage Intermediaries meeting next month and it is overwhelming, they and have an inbox of unethical and in some case illegal examples from other brokers as well from our own clients.”
The key issue is that some estate agents appear to be misleading potential buyers, and at the potential financial detriment of those selling a property. Buyers are being told their offer to purchase the property will not be put forward for consideration to the seller unless they agree to additional in-house services offered, such as
mortgage advice or legal services.”
I and other mortgage brokers have had numerous cases of estate agents trying to push financial services onto our customers; in the last three instances, they’ve all been with the same corporate estate agents. They’re pushing this idiotic line of ‘we have to financially qualify them’ even though all the customers in question had already been financially qualified by independent mortgage advisers.”
Jonathan Burridge, founding adviser at We Are Money, remarked: “This has been a problem for as long as I have been advising. It is not legal to insist that a buyer uses a specific mortgage broker, solicitor or surveyor, but it can be strongly suggested that such a route would be “beneficial”. The buyer has the option to make a fuss, but that will most probably mean their interest will not be pursued and they will lose out on the potential purchase.”
Peter Hunt at Moneywatch Finance, points out that by law estate agents cannot make it a condition of passing on offers to the seller that the buyer must use services offered by you or another party.
He said “You must not discriminate, or threaten to discriminate, against a buyer because that person declines to accept that you will (directly or indirectly) provide related services to them.”
Peter also highlights the fact that by Law, agents must put all offers to their seller client “even if the buyer has not been financially qualified at that stage”.
It is not acceptable for estate agents to impose conditions on any applicant wishing to view or make an offer on a property. All offers need to be put to vendors, the property ombudsman states that financial qualification does not have to be provided to the estate agents in house mortgage broker, financial qualification is acceptable from any independent financial adviser or mortgage broker, they do not insist that any customer needs to meet with any of the consultants based in an estate agents office.
Do not get bullied or intimidated by these unprofessional sales tactics, if you are happy with the service provided by your own financial adviser/mortgage broker, you are within your rights to say NO to the estate agent & your own mortgage adviser can help support you in making an offer.
For further information please contact Peter Hunt on: 0121 503 0961
www.moneywatchfinance.com
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THE MIDLANDS PROPERT Y GUIDE MONE YWATCH F INANCE
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