Are we being lied to by the estate agent? AIBU to be so suspicious(39 Posts)
We fell in love with a property on Saturday and its open day. The property has only gone on the market a few days earlier. It's a popular area but this street often has them up for sale. There were 3 other couples there. We liked the property a lot and it was only very slightly above budget. We made an offer less than 2 hours later and were told soon after that it was a bidding war between us and another couple. 3 days later and after lots of negotiations back and forth, agent came back to us and said that they had 2 identical offers on the table: we were both first time, cash buyers bidding the same amount. Reluctantly, we put in an extra £500 yesterday which is at the very top of our budget and only £1000 under asking price.
Today we were called back by another agent in the same form saying the person we had been dealing with before was now on holiday. Lady said she'd left a message with the vendor but in the mean time she wanted proof that we did have the funds in place for the cash purchase. We sent this over very quickly. On further probing, she said that the offers were the same but that they were mortgaged and not cash like us. It made it sound like we were definitely in a stronger position. Late this afternoon, she called and said that the vendor decided to go for the other couple who had offered the same amount of money but with a mortgage in principle.
I was disappointed but OH is very angry at agent and feels theres been some miscommunication. He thinks the agent he spoke to yesterday who said the other buyers were cash like us only lied to encourage us to bid more money.
I'm baffled that a vendor in this position would pick a mortgage over a cash purchase. The only feedback that agent could give us was that the other party had made an initial offer first but even if that is the case, there can't have been more than an hour in it..
Do you think the agent is lying to us about the other buyers?
I told them we were disappointed and would leave the offer on the table but in truth we are absolutely gutted. Am I being unreasonable to think that this is poor behaviour even for estate agents?
This isn't in london/south east by the way.
I have known two people not have their offers put forward by the agent and in both cases they found out because they put a note through the door. Could be worth a try?
In one case the agents brother was buying the property for a bargain...
We don't know where the vendors live, I'm afraid, otherwise I would have gone for the note option - property is currently vacant.
Sounds strange to me too. I always thought cash buyers were preferred because mortgages could always fall through.
Could the other bidders have arranged their mortgage with a financial adviser linked to the Estate Agents? Cynical possibly.
Impossible to say!
Maybe the vendor really did want to take the offer from the people who bid first?
I would go in to the Estate Agents office and speak to whoever called you yesterday. You will get a much better sense of whether or not she is telling you the truth if you can speak face to face.
Oh that's a shame.
I would also go in and if you think they are lying call them on it
But the agent's job is to get the best price for the seller. You give your highest bid and take your chances.
The problem is fairenuff that sometimes they don't put your offer forward. Which I understand they are obliged to do
Maybe they met the other vendors and liked them. Or they were more amenable in the offering process
They would put it forward if it was the best offer.
Get a land registry search to find out who the vendors are. I think this can be done online
Not if they have another interest in the other offer though.
I agree, the agent works for the vendor. They have no obligation to tell you anything other than whether your offer is accepted or rejected.
I don't see what the estate agents done wrong? (and I'm normally the first to criticise estate agents)
People accept offers for different reasons, it's not always based on money
I'd be very suspicious that the estate agents stood to make something from the other buyer, such as commission on arranging a mortgage.
Find out from the Land Registry who owns the property and make direct contact.
I have had quite a bit of professional contact with Estate Agents and I'm sorry to say that they generally cannot be trusted. Their business model is based on maximising their income from any transaction.
DO NOT TRUST ESTATE AGENTS (They frequently lie to suit their own ends, I've seen it in action, they think that's how they need to play the game to be financially successful) - GET ROUND THEM TO THE VENDOR DIRECT IF AT ALL POSSIBLE.
The idea that the other buyers have a mortgage arranged via the agents is a possibility, they may have incentivised the vendor to accept their offer with a reduced percentage fee for their services. We had two 'bidding wars' when buying but I'm convinced the other bidders were imaginary. I wouldn't trust an estate agent and find they often are obstructive when you try to make contact with the buyers/vendors.
A similar thing happened to us, though neither party were cash buyers. We eventually found out that the estate agent told the other party what our offer was - so he bid £501 more. It turned out to be the estate agents mate and they were buying the property together to do up and sell for a profit as it had a lot of potential. The estate agent was sacked before we found out. Poetically, the house was found to have severe structural issues when they were working on it.
Don't trust the estate agent. Find out the name and address of the owners somehow and contact them directly and ask if they received your bid.
It does sound fishy, however is it possible that the vendor thinks a cash buyer is an investor and wants to sell to someone they believe is going to live in the house themselves? I've read a few threads on here where sellers have chosen a family over someone they thought was going to rent the place out.
The thing about the buyers getting a mortgage through the EA could well be true, a friend of ours found out after the sale went through that their EA didnt forward 2 higher offers because the buyers he did put forward were getting their mortgage through a broker attached to his office and he got a commission from it as well as the sale.
This was 20 years ago now, so not a hell of a lot they could do but they did threaten to report the agency and got a reduction off the fees.
I don't think the agents would go back and forth for days and go to the trouble of getting proof of funds if they were not putting forward the offer.
Pasta, agents are obstructive when buyers want to contact vendors directly because it will often lead to them to getting screwed out of their fees. It also causes problems during the process.
Just for a different perspective - cash buyers are much more likely to pull out of a transaction or attempt renegotiations after agreement in principle, than those purchasing with mortgage assistance. This is because the latter category of purchaser is sometimes more invested in the process, having shelled out a mortgage and survey fee, and also it is practically more difficult for them to renegotiate price as this will affect LTV and in a lot of cases require a fresh mortgage application (costing more time and maybe more money).
Who can say and I know agents can be difficult, but there are circumstances in which a vendor might be wary of a cash purchaser.
I too would be wary that there is not something else going on.
We had an issue with an EA when we were selling our house. Someone who had desperately wanted to see our house (colleague of a neighbour) made contact to say the agent was not getting back to them about a visit and they wanted to know if the house was still for sale.
Turned out the EA had 4 other people interested in our house, but he would not show it because he had a client who had made an offer at asking price and was trying to organise the funds, the agent had not 'yet' notified us of the offer and we insisted that until a firm offer was made the house stayed on the market and was shown to other people.
We ended up making close to £2,000 more than the original offer he was about to present to us. We eventually found out the purchaser is a friend of his.
Agent is most likely a) worried you'll go direct through owners as your cash buyers and b) likely to have a stake in mortgage arrangements for other buyers. Therefore financially protecting themselves.
So I agree find the vendor - there are ways and MNers are great at knowing them - and make your offer direct stating how financially they will benefit going with you.
Best of luck.
I wouldn't be quite as suspicious of the agent if there hadn't been a few issues in the negotiation process: we got calls about the property by a different agent each time and each time there was some information that they hadn't got right: initially thought we were buy to let, we confirmed that we definitely weren't and wanted to live in the property as our first home, confusion about chain.
I then decided to put our offer and position in an e-mail and they claimed not to receive this.
Does anybody know how I can check land registry for who the vendors are?
The agent will most definitely have put forward all offers. It is required by law. Also, people are fickle and change their minds so agents would not just rely on the mortgaged offer coming good. Ultimately, they want the fee and the cash offer is the fastest way to getting it.
It does then sound bizarre that the vendor had chosen the other applicants over your proceedable offer. Usually an agent would advise the vendor to go with your offer.
There could be a couple of things going on here if you are dealing with a wonky estate agent (not all are bad!)
1. The estate agent may have recommended a financial advisor and be set to achieve a £500 introductory fee if the mortgage is completed with other people.
2. The estate agents know mortgaged people and do a lot of business with them (if they have portfolio of properties and are an investor). They might have said to the vendor they have a good relationship with them and trust them to complete. Whereas you are a cash buyer but they don't know you from Adam.
3. The vendors know the people with the mortgage and therefore made an emotional decision to accept mortgaged offer.
If you are worried you could approach the owner of the estate agent and get some clarification. They would not want bad practice going on in their agent so they can do some investigating and come back to you.
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