Jump to content
House Price Crash Forum
loginandtonic

Estate Agents Refusing To Sell Homes To Buyers Who Don't Use Their

Recommended Posts

Some "expert" called Luke was on, and there was a short film with a IFA and buyers claiming this - that estate agents are giving pref treatment to FT buyers using their brokers, even buyers who already have a mortgage offer lined up elsewhere with a different mortgagee. Luke went as far as to say some of the larger agents are turning away FTBs who don't use their brokerage.

No shortage of buyers would be the spin from this. or truth.

if truth, HPC is postponed again it would seem.

quite unbelievable how in this economic climate people want to rush into taking on a huge commitment, oh thats right some people get our tax money paying their mortgage if they get redundant. nice one, gordon, but you're still out come election day.

unemployment up

debt at a record

world slump

property in great demand again in London at least

- it must all make sense somehow, i dont have the iq to see it though obviously.

Share this post


Link to post
Share on other sites

...this is corruption...tell the sellers...report to the FSA ...FSA not a lot of good in the past but hey ..they have to start some time..I would like to see these people jailed ...like tomorrow.... <_<

Share this post


Link to post
Share on other sites
why?

and this sounds illegal anyway

if you've got so many buyers that EAs can be choosy, obviously no HPC. unless the story is spin or distorted, ie for exec homes or exaggerated.

...this is corruption...tell the sellers...report to the FSA ...FSA not a lot of good in the past but hey ..they have to start some time..I would like to see these people jailed ...like tomorrow.... <_<

BBC London said it is NOT illegal.

Todays bulletin, 2nd item/package after police shot at: http://news.bbc.co.uk/1/hi/video_and_audio/default.stm

Edited by loginandtonic

Share this post


Link to post
Share on other sites
BBC London said it is NOT illegal.

Todays bulletin, 2nd item/package after police shot at: http://news.bbc.co.uk/1/hi/video_and_audio/default.stm

Perhaps their lawyer told them to add that just in case some other lawyer tried it on.

I suspect that, while it may not be illegal, it may very well be against various codes of conduct. The person I'd contact would be the EA ombudsman The Property Ombusman Scheme.

db

Share this post


Link to post
Share on other sites
Perhaps their lawyer told them to add that just in case some other lawyer tried it on.

I suspect that, while it may not be illegal, it may very well be against various codes of conduct. The person I'd contact would be the EA ombudsman The Property Ombusman Scheme.

db

I dont know if it is or isnt though i would have thought not, but they mentioned a well known large chain which i wont name as no point in giving the mods trichomania ;) but i will just say famous for their Minis.

My concern is what the feck is going on if this is true, are these largely bank of mum + dad brats with a large deposit? is there so much demand that agents can say "naaaaaah if you dont use our mortgage man then naff off" - this spin or true story from the BBC suggests high enough demand. gobsmacking really.

Share this post


Link to post
Share on other sites

I absolutely believe this to be happening. In fact this has been going on for some time but during the 'boom' years it was ignored.

I posted about this on the House Buying, Selling thread a couple of days ago. Somebody else posted recently about buying a car and the fact that although he was buying with cash the company was more interested in selling him credit. The commissions from selling credit/mortgages/finance outweigh the amount made on the actual house sale commission and therefore a cash buyer or someone with a mortgage already in place is not so lucrative. This means that the estate agent is therefore not acting in the best interest of the seller.

I am attempting to purchase a house at the moment. I am a cash buyer and need to move in at the end of this month. One agent with a property I wanted to look at for a second time (viewed last Friday) with view to putting in an offer (I told him this) has informed me that it is under offer although it is still listed and is vacant possession. Because of this I asked to view another property (again vacant) and he will not return my calls. When I first spoke to him I explained that I was a cash buyer and he twice on the phone and once in person suggested that I meet with the agency approved mortgage adviser!? I shall be dropping off letters to both vendors tomorrow explaining that I do not think the agent is acting in their best interest. The agency is part of a nationwide chain. A similar situation arose a couple of years ago with my parents where, although they were cash buyers, the agent advised the vendor to go with another purchaser where the agent had arranged the mortgage. Chain broke down and house has been rented on and off to this day.

Common sense tells you that a cash buyer who can move quickly if needed is by far the best option for any seller.

The amounts of money STILL being made via commissions/fees on encouraging debt has not stopped.

Share this post


Link to post
Share on other sites

This has been happening for years. It happened to me in 1999. I already had an offer from another broker but the estate agent wanted to "financially vet" me and insisted that I used their inhouse broker.

Share this post


Link to post
Share on other sites
BBC London said it is NOT illegal.

....that is where the law does not reflect justice....the conflicts of interest arising would not be seen as corrupt by a government who cover up the fiddling of MPs' expenses....they don't understand the basics of right and wrong....... <_<

Share this post


Link to post
Share on other sites

Heres a thought / suggestion. Why don't we move to the American model. The buyer uses an agent to find a place, help gain finance if needed and gets comission from the buyer I believe for doing so.

Would it be illegal for 'me' to just setup a business acting on behalf of buyers. I then contact the seller directly (not via any agency they may use) and help negotiate an equitable deal? Seems like an ideal answer to me. I'd even be able to advise on properties that match your search so you don't waste time looking at lamers.

Can anyone advise if this is a legal and workable business model. If it is would anyone like to start up with me :)

Share this post


Link to post
Share on other sites
Some "expert" called Luke was on, and there was a short film with a IFA and buyers claiming this - that estate agents are giving pref treatment to FT buyers using their brokers, even buyers who already have a mortgage offer lined up elsewhere with a different mortgagee. Luke went as far as to say some of the larger agents are turning away FTBs who don't use their brokerage.

As other posters have said, this has been going on for years. When we first started lookign for a place to buy back in in 2000, various agents made it clear that our offers had much more chance of success if we used both in-house mortgage, and conveyancing services. One then promptly tried to sell us an endowment mortgage. In the end, we ended up waiting nearly 2 years to buy a place - partly as a result of sales falling through (due to amongst other things agents telling lies). My advice for any FTB would be: 1) take your time - there are loads of properties out there. 2) do not believe a word any agent tells you.

Share this post


Link to post
Share on other sites
Heres a thought / suggestion. Why don't we move to the American model. The buyer uses an agent to find a place, help gain finance if needed and gets comission from the buyer I believe for doing so.

Would it be illegal for 'me' to just setup a business acting on behalf of buyers. I then contact the seller directly (not via any agency they may use) and help negotiate an equitable deal? Seems like an ideal answer to me. I'd even be able to advise on properties that match your search so you don't waste time looking at lamers.

Can anyone advise if this is a legal and workable business model. If it is would anyone like to start up with me :)

Try contacting Phil Spencer (of "Location, Location, Location" fame) - I understand his business doing just that went broke a little while ago. Maybe he would like to start again with you. :lol:

db

Share this post


Link to post
Share on other sites

Simple solution.... bypass the agent, knock on the door and say "hello, I'm Mr. X, and I am willing to give you X pounds for your gaff".

If they accept, get straight down to the solicitors, draw up a contract, and purchase.

We don't actually need estate agents.

Share this post


Link to post
Share on other sites
Simple solution.... bypass the agent, knock on the door and say "hello, I'm Mr. X, and I am willing to give you X pounds for your gaff".

If they accept, get straight down to the solicitors, draw up a contract, and purchase.

We don't actually need estate agents.

In that case, the EA would issue the vendor with a bill for the contracted sale fee. It's all in the contract the vendor signs.

I had to deal with this recently with a house I had to sell (probate). I had a private buyer interested after signing the EA contract. I had to make sure the HIP was stopped and no board was placed outside so if the buyer bought, I would have no fee to pay as the EA couldnt claim their advertising attracted the buyer. The EA insisted I would have to pay but legal advice said otherwise (sole agency, not sole selling rights).

VMR.

Share this post


Link to post
Share on other sites
As other posters have said, this has been going on for years. When we first started lookign for a place to buy back in in 2000, various agents made it clear that our offers had much more chance of success if we used both in-house mortgage, and conveyancing services. One then promptly tried to sell us an endowment mortgage. In the end, we ended up waiting nearly 2 years to buy a place - partly as a result of sales falling through (due to amongst other things agents telling lies). My advice for any FTB would be: 1) take your time - there are loads of properties out there. 2) do not believe a word any agent tells you.

Great impartial financial advice then, I wonder if the commission was higher on endowment mortgages when you went for advice?

Share this post


Link to post
Share on other sites
I absolutely believe this to be happening. In fact this has been going on for some time but during the 'boom' years it was ignored.

I posted about this on the House Buying, Selling thread a couple of days ago. Somebody else posted recently about buying a car and the fact that although he was buying with cash the company was more interested in selling him credit. The commissions from selling credit/mortgages/finance outweigh the amount made on the actual house sale commission and therefore a cash buyer or someone with a mortgage already in place is not so lucrative. This means that the estate agent is therefore not acting in the best interest of the seller.

I am attempting to purchase a house at the moment. I am a cash buyer and need to move in at the end of this month. One agent with a property I wanted to look at for a second time (viewed last Friday) with view to putting in an offer (I told him this) has informed me that it is under offer although it is still listed and is vacant possession. Because of this I asked to view another property (again vacant) and he will not return my calls. When I first spoke to him I explained that I was a cash buyer and he twice on the phone and once in person suggested that I meet with the agency approved mortgage adviser!? I shall be dropping off letters to both vendors tomorrow explaining that I do not think the agent is acting in their best interest. The agency is part of a nationwide chain. A similar situation arose a couple of years ago with my parents where, although they were cash buyers, the agent advised the vendor to go with another purchaser where the agent had arranged the mortgage. Chain broke down and house has been rented on and off to this day.

Common sense tells you that a cash buyer who can move quickly if needed is by far the best option for any seller.

The amounts of money STILL being made via commissions/fees on encouraging debt has not stopped.

Sorry, untrue.

The commission on a sale far outweighs the commision on the finance.

Not to say that the finance commission is worthless of course.

Share this post


Link to post
Share on other sites
Some "expert" called Luke was on, and there was a short film with a IFA and buyers claiming this - that estate agents are giving pref treatment to FT buyers using their brokers, even buyers who already have a mortgage offer lined up elsewhere with a different mortgagee.

Why is this news? If the house you're trying to buy is worth having, it is likely, except in an extreme slump, that you'll have some competition from other people that like that house too.

In which case it makes sense to use the estate agent's mortgage broker, to give them more incentive to favour you over other people.

Share this post


Link to post
Share on other sites
Why is this news? If the house you're trying to buy is worth having, it is likely, except in an extreme slump, that you'll have some competition from other people that like that house too.

In which case it makes sense to use the estate agent's mortgage broker, to give them more incentive to favour you over other people.

i dont decide the news agenda at the bbc, nick. i wish i did.

it is supposed to be a slump big enough to mean that agents cant pick & choose who they sell a property to. so if this story is true then there is quite a new boom in london at the moment. a thing i find very troubling. therefore the boe needs to up rates today before it stores up yet more trouble upon trouble upon trouble.

Share this post


Link to post
Share on other sites
Sorry, untrue.

The commission on a sale far outweighs the commision on the finance.

Not to say that the finance commission is worthless of course.

It all adds up.... The main reason for an EA to use an internal Broker is to find out how much your salary is and how much money they can take off you. If they know your limits then they can invent other fake buyers and bid you up to your maximum... But the commission helps aswell

Share this post


Link to post
Share on other sites

Some "expert" called Luke was on, and there was a short film with a IFA and buyers claiming this - that estate agents are giving pref treatment to FT buyers using their brokers, even buyers who already have a mortgage offer lined up elsewhere with a different mortgagee. Luke went as far as to say some of the larger agents are turning away FTBs who don't use their brokerage.

Well, anecdotally, I'm an FTB interacting with 10-20 EAs in London on a frequent basis and have never had the slightest suggestion of this. About one third of agents have asked if they can have their broker call me and been fairly pushy salespeople for their brokerage, but have always taken my flat 'No' with their customary grace and continued trying to sell me properties that don't fit the bill for money I can't afford as assiduously as ever.

That said I feel this is an area that would benefit from legislation/regulation. Affiliation between brokers and EAs clearly contributed to a 'liar loan' boom and is a deeply pernicious aspect of the current housing economy.

Share this post


Link to post
Share on other sites

Some "expert" called Luke was on, and there was a short film with a IFA and buyers claiming this - that estate agents are giving pref treatment to FT buyers using their brokers, even buyers who already have a mortgage offer lined up elsewhere with a different mortgagee. Luke went as far as to say some of the larger agents are turning away FTBs who don't use their brokerage.

No shortage of buyers would be the spin from this. or truth.

if truth, HPC is postponed again it would seem.

quite unbelievable how in this economic climate people want to rush into taking on a huge commitment, oh thats right some people get our tax money paying their mortgage if they get redundant. nice one, gordon, but you're still out come election day.

unemployment up

debt at a record

world slump

property in great demand again in London at least

- it must all make sense somehow, i dont have the iq to see it though obviously.

estate agents have always tried to push business through their own brokers for the commission gain and this has gone on to a greater degree recently.. however as most of these brokers have access to most of the market the customers really only lose out if they pay a feee ( as there are free brokers) and I doubt it has much impact on the wider housing market.

Share this post


Link to post
Share on other sites

Well, anecdotally, I'm an FTB interacting with 10-20 EAs in London on a frequent basis and have never had the slightest suggestion of this. About one third of agents have asked if they can have their broker call me and been fairly pushy salespeople for their brokerage, but have always taken my flat 'No' with their customary grace and continued trying to sell me properties that don't fit the bill for money I can't afford as assiduously as ever.

That said I feel this is an area that would benefit from legislation/regulation. Affiliation between brokers and EAs clearly contributed to a 'liar loan' boom and is a deeply pernicious aspect of the current housing economy.

I'm in a similar position - I always ask whether they want to sell me a house or a mortgage. They get to pick one, not both.

Share this post


Link to post
Share on other sites

From the Property Ombudsmans website and the Code of Practice for Sales (for Estate Agents):

http://www.tpos.co.uk/make_complaint_sales.htm

Discrimination

6c By law you must not discriminate, or threaten to discriminate, against a prospective buyer of the seller’s property because

that person declines to accept that you will (directly or indirectly) provide services to them. Discrimination includes – but

is not limited to – the following:

• Failing to tell the seller of an offer to buy the property.

• Telling the seller of an offer less quickly than other offers you have received.

• Misrepresenting the nature of the offer or that of rival offers.

• Giving details of properties for sale first to those who have indicated they are prepared to let you provide services to

them.

Making it a condition that the person wanting to buy the property must use any other service provided by you or

anyone else.

Share this post


Link to post
Share on other sites

this thread is 11 months old. I very much doubt this would be happening at the moment! Eas wil always push their in house mortgage advisors though whatever the Market.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now

  • Recently Browsing   0 members

    No registered users viewing this page.

  • The Prime Minister stated that there were three Brexit options available to the UK:   295 members have voted

    1. 1. Which of the Prime Minister's options would you choose?


      • Leave with the negotiated deal
      • Remain
      • Leave with no deal

    Please sign in or register to vote in this poll. View topic


×

Important Information

We have placed cookies on your device to help make this website better. You can adjust your cookie settings, otherwise we'll assume you're okay to continue.