Would you sign this estate agent contract?
I am concerned with the WITHDRAWAL FEE clause. It says irrespective of your reasons you have to pay 10% of the commission fee.
Does this mean if I was in a chain and I was offering on a property that falls through and I had to tell my potential buyer I can't sell it as I haven't found anywhere; I still have to pay the Estate Agent? Are there any other scenarios that would make this clause a problem and worth challenging?
Are there any other terms worth challenging?
I would really value your advice and experience.
Terms and Conditions
- DEFINITIONS
In these Terms and Conditions the following words mean:
1.1 ‘Remuneration/Fee/Fees’ – our commission based on the agreed percentage of the sale price, all percentages are exclusive of VAT, which will be charged in addition.
1.2 ‘Introduced’ – means that a buyer viewed the property through our introduction, whether physically, virtually or through a video link. Such introduction is deemed to be effective in terms of introducing a buyer to the property.
In addition, where we have sole selling rights, being Introduced includes viewings by any other means such as through any third party, your own contacts or direct approaches to you. Where any Introduction has been made, you will remain liable to pay us a fee for a minimum period of six months after the termination of this contract. To avoid any potential liability for two fees in the future you should contact us immediately if any buyer already Introduced by us revisits the property through another estate agent.
- SOLE SELLING SERVICE
2.1 You hereby undertake not to instruct any other agent during the term of this agreement. 2.2 To be clear, for the purposes of clause 2.3 below, you hereby agree that private or other agent’s sales originating before the termination date of the agreement are deemed to have been Introduced by us.
2.3 You will be liable to pay remuneration to us, in addition to any other costs or charges agreed, in each of the following circumstances:
• if unconditional contracts for the sale of the property are exchanged in the period during which we have sole selling rights, even if the purchaser was not found by us but by another agent or by any other person, including yourself;
• if unconditional contracts for the sale of the property are exchanged after the expiry of the period during which we have sole selling rights but to a purchaser who was Introduced to you during that period or with whom we had negotiations about the property during that period.
2.4 Our fee is calculated at the rate of 2% of the sale price plus VAT and our appointment has a minimum duration of 20 weeks from the date opposite; termination must be in writing giving 28 days notice.
- MULTIPLE AGENCY SERVICE
3.1 Remuneration will be due to (redacted) if at any time contracts for the sale of the property are exchanged with a purchaser who has been directly or indirectly Introduced by (redacted) during the period of our agency agreement; or alternatively where we were the effective cause of sale such that a sale price is agreed. 3.2 Where a multiple agency follows a period as sole seller, the multiple agency fee immediately replaces the sole seller fee.
3.3 Our fee is calculated at the rate of 3% of the sale price plus VAT and our appointment has a minimum duration of 20 weeks from the agreed date of marketing (commence marketing date opposite); termination must be in writing giving 28 days notice.
- ASSET TRANSFER
It is the intention of the parties to this agreement that a purchase by asset transfer (for example using a limited company or trust etc) will be treated as if it was a sale of the property for the purposes of this agreement.
_^*5. WITHDRAWAL FEE
We reserve the right to charge a nominal withdrawal fee of 10% (of the fee illustrated in
£’s opposite) if the property is withdrawn from the market during the term of this contract and/or if an offer of the asking price from a ready, willing and able purchaser is declined.
A purchaser is a ready, willing and able purchaser if he or she is prepared and is able to exchange unconditional contracts for the purchase of your property. You will be liable to pay a withdrawal fee to us if such a purchaser is Introduced by us in accordance with your instructions and this must be paid if you withdraw the property, irrespective of your reasons. The withdrawal fee is not payable if we are deemed to be in breach of our obligations under this contract, either by a complaint in writing upheld by the company, or by
The Property Ombudsman.*^_
- PAYMENT OF FEES
6.1 Our fees become due upon exchange of contracts. However, at our discretion it is acceptable to pay when you move, provided that you instruct your solicitors to pay us from the proceeds of sale on the day of completion.If in the unlikely event you fail to complete, the full fee remains payable at the agreed terms.
6.2 We will be entitled to claim from you any legal costs we incur in enforcing the terms of this agreement as a result of any non-payment of our fees.
- MONEY LAUNDERING
(Redacted) is subject to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 and you agree for us to carry out an electronic anti-money laundering check.
- THIS AGREEMENT
8.1 This letter satisfies the Estate Agents (Provision of Information) Regulations 1991, under which we are required to confirm our terms in writing. Should you not sign it but instruct us to proceed and accept viewings on the property you will be bound by all of its terms.
8.2 Any changes to these terms and conditions will not be recognised by us unless agreed in writing and signed by ourselves.
8.3 Agreeing to (redacted) terms does not supersede any existing arrangements you may have with another estate agent. We therefore advise you to ensure you have cancelled any previous sole agency agreement that may leave you liable to