Conditional selling
conditional selling
If you’re currently in the process of selling your home, or looking to move house in the future, recent articles in the press around ‘conditional selling’ may have caught your eye.
It’s been reported that a handful of independent mortgage brokers have made further claims against the estate agency sector over ‘conditional selling’ following recent revelations that some Connells branches have been involved in the practice.
what is conditional selling?
Conditional Selling is when an Estate Agent, sales negotiator, or anyone with the power to sell a house asserts or proposes that a buyer’s offer will not be passed to the vendor (the seller) unless they engage the use the agency’s additional in-house services, such as mortgage advisors or legal services during the transaction.
There have been reports of first-time buyers wanting to put an offer on a property. The client showed the Estate Agent their agreement in principle but were then told their offer would not be accepted unless they sat down with the agent’s in-house broker first.
Independent Brokers are pulling together to make a stand, and claim they have enough evidence and clients prepared to back them to publicly report the agencies involved to the Association of Mortgage Intermediaries. Dubbed the ‘filthy cancer in the estate agency world’, something now needs to be done. This underhand practice is becoming more common as clients have been too scared to complain for fear of missing out on buying their dream home.
Some Estate Agents are arguing the case, pushing the idiotic notion that they ‘have to financially qualify the client’, even though the client has already run through the necessary financial checks with their broker of choice to obtain their agreement in principle with the lender.
Something needs to be done
Pressure selling creates an element of mistrust, between advisors and clients in an industry that’s already had its confidence knocked over recent years.
Debbie Whittaker, Owner of Abode Finance says;
“Pressure selling creates an element of mistrust, between advisors and clients in an industry that’s already had its confidence knocked over recent years. It should not be up to an unqualified estate agent to decide whose financial advice is sound within the industry. They should not be looking to or be allowed to financially benefit from the mortgage that the client has sought advice for.”
work with an Independent Mortgage Broker
Bear in mind that there is no legal obligation to show an Estate Agent your agreement in principle. Some Estate Agents will show you a property without one. This is perceived as another ruse to try to obtain as much information about your financial situation as possible. The Estate Agent may then try to offer you a better deal with their in-house brokers or try to obtain a higher sale price once they know your budget, resulting in higher commission.
We would recommend working with an Independent Mortgage Broker who has an affiliation with trusted Estate Agents that they will happily recommend without recompense. Moving home and buying property can be one of the most stressful things we encounter, so you need to be able to trust the people around you.
We also need to be mindful that if Estate Agents are insisting clients give their in-house services their personal details, it’s also a GDPR issue (the protection of your personal data). The client could also be credit scored again, which would impact their credit file.
It’s worth noting that Estate Agents don’t have any financial training – so they should not be advising or influencing who clients use for brokering.
The sad and disheartening thing about this, is these tactics are damaging to the industry and to the honest, trusted Estate Agents and Brokers who have their clients’ best interests at heart. But most importantly, clients are also losing properties if they refuse to use the Estate Agents services, which is not acceptable.
be mindful
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE