Estate agent disclosure of buyer details

Collapse
X
 
  • Filter
  • Time
  • Show
Clear All
new posts

    Estate agent disclosure of buyer details

    What is the law/rights/regulations here.

    I'm selling a property in a narrow time-window. Selling estate agent has a number of offers of which one sounds most acceptable. Agent states that buyer is chain free, has no need to a mortgage as he has "capital from a remortgage". I want to carry out due scrutiny on the potential buyer myself (bank statements, full knowledge of their exact full name and current living circumstances...).

    I see no reason to accept an offer, invite the other side to submit enquiries, and then have the thing fail predictably (and then incur legal costs and also a delay which might be fatal). Agent says I have no right to this information (including even the exact identity of the buyer -- but I want a lot more) before accepting the offer and inviting queries.

    Someone enlighten me.

    #2
    There may be something in the agent's terms and conditions about this, obviously, I don't know what they say, so this is more general.

    I don't think the agent is wrong, you don't have a general right to know who's making an offer, or to know more details about them.
    In the same way you don't have a right to know my name or address (or whatever other information that you might want to know).

    But, similarly, you don't have to accept their offer and have every right to make your acceptance conditional on certain things (with the obvious proviso that the conditions are lawful in themselves.)

    It's possible that the agent doesn't want you to try and cut them out of the deal, rather than doesn't want you to know that the potential buyer isn't in the position that they say they are.
    The agent does owe you a fiduciary duty, so they really shouldn't be anything other than truthful and transparent.

    But it is odd, if you were selling your home, the chances are you'd have met all of the potential buyers and have had every opportunity to get to know them when you met.
    When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
    Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

    Comment


      #3
      You do not have a "right" to the information, but there is nothing to stop you saying you will not accept his offer until the information you require is produced. If someone says they have finance lined up I can see no good reason why they should not prove it. I confess though I am not sure why you feel you need to know his current living circumstances.

      Comment


        #4
        Originally posted by Lawcruncher View Post
        I can see no good reason why they should not prove it. I confess though I am not sure why you feel you need to know his current living circumstances.
        Well because that is part of their financial status. If they have sufficient cash in the bank, but are committed to a 2 year tenancy at £2k/month and cannot show they can escape that, it is a debt like any other.

        I have not met any of the viewers. It is not my home, and Covid has provided a convenient excuse to make it impossible for me to meet all those viewing.

        Comment


          #5
          Originally posted by AndrewDod View Post
          Well because that is part of their financial status. If they have sufficient cash in the bank, but are committed to a 2 year tenancy at £2k/month and cannot show they can escape that, it is a debt like any other.
          If the buyer can show he has the cash is that not enough? After all, there is no saying that he is not buying more than one property at the same time. If someone is a cash buyer it is fair enough to ask them to prove it and it is not a case of "I will have the cash when grandfather's probate comes through".

          My experience of residential conveyancing is that on the whole people who have offers accepted do not withdraw except for a very good reason. Complete timewasters are rare.

          You need to be careful that you do not incur commission without selling the property. Depending on what your contract with the agent says, you may be liable to pay if he finds someone "ready, willing and able" to buy. A bank statement showing the potential buyer can cover the sale price is going to be enough to show the buyer is "able".

          Comment


            #6
            Originally posted by jpkeates View Post
            It's possible that the agent doesn't want you to try and cut them out of the deal, rather than doesn't want you to know that the potential buyer isn't in the position that they say they are.
            On this minor aspect I would say the reverse applies. Agency contracts will specify that their fee is payable if they introduce the (eventual) buyer. I can't know (and nor can they prove) that an eventual buyer was actually introduced first by them to me unless I can know who such persons are.

            Indeed my contract says that if I later re-market with a different agent and if someone earlier introduced by them purchases I still owe their fee -- so having me not know the names of all those who express interest or view whether they make an offer or not -- is untenable.

            Comment


              #7
              Originally posted by Lawcruncher View Post
              If the buyer can show he has the cash is that not enough? After all, there is no saying that he is not buying more than one property at the same time. If someone is a cash buyer it is fair enough to ask them to prove it and it is not a case of "I will have the cash when grandfather's probate comes through".
              Fair enough.

              Originally posted by Lawcruncher View Post
              My experience of residential conveyancing is that on the whole people who have offers accepted do not withdraw except for a very good reason. Complete timewasters are rare.
              I think it is more of a case of a "suitable match" rather than timewasters. As with getting an AST tenant there is far more to picking one than a technical credit report. I might for whatever reason be in a situation where I would suffer significant detriment if a process were to restart with a delay and a different purchaser, or I might have very good reasons for not wanting to sell to a particular type of person (for example to a BTL landlord versus a homeowner if I have an interest in the building). I want to minimise risk.


              Originally posted by Lawcruncher View Post
              You need to be careful that you do not incur commission without selling the property. Depending on what your contract with the agent says, you may be liable to pay if he finds someone "ready, willing and able" to buy. A bank statement showing the potential buyer can cover the sale price is going to be enough to show the buyer is "able".
              That would be extremely sneaky and sounds like an unfair condition. If a buyer withdraws after having received disclosures are they still "willing". Anyway you made me nervous and I checked again -- our contract says "unconditional contracts for sale are exchanged" -- but even then completion might not take place (precisely because the incorrect buyer was selected in the first place - which takes me back to the right to know who the buyer is before accepting that an offer is made).

              If someone withdraws from a contract and gives a reason of any sort, was that contract "unconditional"

              Comment


                #8
                AndrewDod:

                Go here and scroll down to "Things to watch out for".

                Comment


                  #9
                  Yikes - thanks.

                  Comment


                    #10
                    Lawcruncher I have been thinking about this some more. It does seem a highly unfair condition, which if a home is occupied, leaves little scope for anything other than

                    a) Exchange and completion on the same day
                    b) Following immediately by a short-term letting agreement/AST

                    Obviously there is always some risk, but adding a £10,000 estate agent fee for a non-successful sale is not really tenable for most people, and would seem to be a foot-shooting exercise for the agent too. Strange that the powers that be get so exercised about (genuinely) unfair contractual clauses in some domains (ASTs) but couldn't care less about flagrant abuses in others (lessee/freeholder interface, property sales and purchases).

                    Comment


                      #11
                      its a question of what the agents letter of engagement said. In the old days agents were entitled to be pad if they introduced a buyer that was ready willing and able. This came to mean that they had done all their due diligence and had the funds ready to proceed. There were many cases as to whether the purchaser was quite ready, and so forth. Nowadays most agents engagements say if we introduce a buyer who exchanges contracts unconditionally and the fee is payable upon completion. As a buyer who claims to be a cash buyer I have often been asked to prove cash funds and I would hope the agent keeps copy bank statements confidential and the trust between seller and his/her agent is sufficient such that if the agent says these buyers have proved that they have the wonga it is adequate.

                      Comment


                        #12
                        There has to be doubt about whether unfair terms come into it as they do not apply to any term which "specifies the main subject matter of the contract". The core of the contract is that if the agent finds someone to whom the property is sold you pay him commission. The contract provides that the property is sold if contracts are exchanged. Legally that is in fact the case because the sale contract is an executory contract which is only perfected on completion.

                        If the contract is not completed through the default of the buyer then a seller is obviously going to be reluctant to pay commission. I think most people would agree as there has in effect been no sale. A chancery barrister may come up with a good reason why the seller should not pay, but none immediately occurs to me. If a decent deposit has been paid the agent may argue that you have funds to pay and will not actually be out of pocket; it would not be unreasonable if a decent deposit has been paid to give some of it to the agent.

                        However, I think there are scenarios where it would be reasonable for commission to be paid if the sale is not completed. The clearest is if the seller defaults and probably also if the seller agrees to release the buyer.

                        A requirement to pay commission if the property is sold during a certain period is there to prevent underhand dealings by the seller. It is certainly arguable that it is an unfair term if the agent is to be paid commission if he is not instrumental in achieving a sale.

                        In my experience it is rare for a sale not to be completed once contracts have been exchanged. In nearly 30 years of conveyancing I only ever had one case. If you insist on a full deposit it should cover any loss.

                        Comment


                          #13
                          Originally posted by flyingfreehold View Post
                          This came to mean that they had done all their due diligence and had the funds ready to proceed.
                          That covers the ready and able, but not the willing.

                          Comment


                            #14
                            I'd caution against doing your own due diligence on a buyer. You open up yourself and the estate agent to housing discrimination claims. I'm glad the estate agent has taken the position they have; it's reassuring. No vendor needs to know anything about the identity of the buyer.

                            I'd never turn over bank statements to a vendor, an estate agent, or anyone else who does not have fiduciary responsibility and data protection obligations. As long as I can afford the property, it's none of a seller's business how much money I have, and it's not in my interest to reveal that. The estate agent can speak to a mortgage broker (if I'm buying financed) or an accountant / solicitor (if I'm buying cash), who can confirm affordability. All anyone needs to know is that I have legally-obtained money to cover the purchase price and fees - nothing else. I'd probably call the ombudsman immediately if an estate agent asked me to provide bank statements.

                            Instead of doing your own due diligence, can't you come up with a list of reasonable questions that a trusted third-party could verify? E.g., Can the purchaser provide verification from their solicitor that they have X in funds to cover purchase price and transaction fees, and that the solicitor has conducted standard anti-money laundering checks?

                            I understand your need, just think there are far better ways to go about it.

                            Comment


                              #15
                              Originally posted by LAD View Post
                              I'd caution against doing your own due diligence on a buyer. You open up yourself and the estate agent to housing discrimination claims.
                              On what possible grounds?

                              It is obviously not compulsory to use an agent at all (or a solicitor for conveyancing). Are you suggesting that anyone who does not employ such professionals is breaking the law.

                              Asking to see an original bank statement (and being shown it) has absolutely nothing on earth to do with "data protection legislation".

                              Originally posted by LAD View Post
                              I'm glad the estate agent has taken the position they have; it's reassuring. No vendor needs to know anything about the identity of the buyer.
                              Really? Their identity?

                              Originally posted by LAD View Post
                              I'd never turn over bank statements to a vendor, an estate agent, or anyone else who does not have fiduciary responsibility and data protection obligations. As long as I can afford the property, it's none of a seller's business how much money I have, and it's not in my interest to reveal that.
                              Well you would get turned down flat. I'd want to see evidence of that affordability before expending money and time on a potential sale and turning down other buyers and getting rid of tenants. Speaking with an accountant is not evidence.

                              Originally posted by LAD View Post
                              All anyone needs to know is that I have legally-obtained money to cover the purchase price and fees - nothing else. I'd probably call the ombudsman immediately if an estate agent asked me to provide bank statements.
                              You would be reporting 99% of agents, and 100% of competent ones

                              Comment

                              Latest Activity

                              Collapse

                              • overriding interests in actual occupation
                                by first timer 123
                                If an interest belonging at the time of the disposition to a person in actual occupation is an overriding interest, so far as regards to land of which he is in actual occupation.

                                As beneficial owner seller A makes a disposition to B, but at this time A remains in actual occupation of part...
                                14-05-2021, 16:58 PM
                              • Reply to overriding interests in actual occupation
                                by first timer 123
                                The plan you show whould be so very hard for any conveyancer or purchaser to pick up. I can't help but say this particular situation would be so very obvious to all involved. Even today conveyancers, solicitors etc say to check for anomolies. This anomaly would be blatantly obvious. Not only 100 years...
                                15-05-2021, 20:36 PM
                              • Reply to overriding interests in actual occupation
                                by Lawcruncher
                                The following scenario explains how errors can occur.



                                The above show 2 houses 6 and 8. Forget the red and it shows the two houses as they were in 1900. It is how they appeared on the OS plan in that year. In 1920 John buys the two houses. He wants to live in 6 and let 8....
                                15-05-2021, 18:21 PM
                              • Access over estate road
                                by Swanny3542
                                Hello,
                                I currently live in a row of terrace houses, with a parking space behind my property. Access to the parking space is via a shared “estate road” which is referenced within the deeds of the property and each property within the row of houses.

                                The developer accidentally transferred...
                                15-05-2021, 13:21 PM
                              • Reply to overriding interests in actual occupation
                                by first timer 123
                                What you say makes complete sense and I will come back to what you say, also with regards to what you see is what you get. You have answered so many of my many posts and questions and if you had been a solicitor, I can only imagine what the cost could have been!
                                From what I'm gathering it's your...
                                15-05-2021, 12:16 PM
                              • Reply to overriding interests in actual occupation
                                by Lawcruncher
                                I will try and explain.

                                Back in feudal times barons were often fighting each other for land. A baron might go off on a crusade and return home to find that a neighbouring baron had taken advantage of his absence and taken over his land. He would literally have to fight to get it back. To...
                                15-05-2021, 09:44 AM
                              • Reply to overriding interests in actual occupation
                                by first timer 123
                                What I am failing to understand or make sense of is how occupation alone can simply change the title to another's property only because they do not occupy and someone else does.
                                For example I could sell a freehold property I own, which has a sitting tenant.
                                The new purchaser of my property...
                                15-05-2021, 00:25 AM
                              • Reply to overriding interests in actual occupation
                                by Lawcruncher
                                By way of example:

                                A sets up a trust which provides for B to have a life interest and on B's death for the interest to revert to A. In that case A owns the reversion.

                                A sets up a trust which provides for B to have a life interest and on B's death for the interest to pas to...
                                14-05-2021, 21:23 PM
                              • Reply to overriding interests in actual occupation
                                by first timer 123
                                ​​​​​​Everytime I research remainder or reversion I come up with:


                                Reversion, in the context of real property, means the return to the grantor or his/her heirs of real property after all interests in the property given to others have terminated. Reversion occurs when the...
                                14-05-2021, 18:36 PM
                              • Reply to overriding interests in actual occupation
                                by Lawcruncher
                                The concept of an overriding interest only applies to registered land. The clause you quote comes from a conveyance and accordingly when it was made the land must have been unregistered. The same clause also deals with the technicalities of covenants implied under the Law of Property Act 1925 and has...
                                14-05-2021, 18:13 PM
                              Working...
                              X