Being told to use agency mortgage advisor and solicitor to get property. Is this right?

[measureofmydreams]

My DS and his partner are chain free they have a mortgage agreed in principle and a solicitor ready. They have put in an offer on a vacant chain free house. There is one other bidder.

They were told that they are both in the race. The Estate Agent has said that the vendor had a previous sale fall through. He will reduce the price by £2.5k if they use the agency's mortgage advisor and solicitor. His rationale is that this will ensure the sale goes through quickly and without any hitches.

Something doesn't feel right. My DS asked me for my opinion. I've never heard of this before. Also they are ready to go and their independent advisor has said she switch them to the lowest mortgage rate when they are close to buying.

I also wonder if there are any rules around the inducement of selling financial products and legal services.

Has anyone else had this experience?

What do you think?

Sounds very wrong. Agents get a commission and for sure that is what’s motivating it here. I would be amazed if the seller really said this or at least without being told a lot of nollockst

it would actually take longer to get a new mortgage advisor involved

I think the EA is offering to reduce the fee they charge the vendor as they probably get kickbacks from the solicitor and also will make on the financial fees from the mortgage. So rhe EA effectively doesn't lose the 2.5k fee they just get it from elsewhere.
In theory both the solicitor and the financial advisor are regulated so have to provide advice or conduct the transaction accordingly ie to professional standards. In principle it should make zero difference so if there are enquiries the solicitor has to make of the vendor then they just need doing and if they take x weeks then that's how long it takes. But the EA I suppose can hassle them easier than a random.
If they have a mortgage already lined up with an IFA then they may find pointless to switch at this point.
The solicitor if he doesn't have one then could use that recommendex one - it won't be the same as the vendors one anyway

Definitely don’t use a mortgage advisor or solicitor recommended by the agent

Same thing happened to my friends daughter, despite my friend lining up a solicitor and finding a mortgage deal, they were young and vulnerable and frightened of losing the house and said they just wanted it to be easier.
Is it worth asking their own solicitor about this, maybe they can put the frighteners on the EA?

It sounds unethical to me.

We had an EA tell us as sellers that the people offering had agreed to use their conveyancer and mortgage adviser. I asked why they were telling me this and they said it showed how determined the buyers were to make the sale go through.
It didn’t influence me and the sale fell through anyway, but they’re playing the game both ways.

Definitely unethical but I’ve heard of it happening. Particularly in the last couple of years when the race for properties meant the estate agents could be super picky about who they put forward to the sellers. When I bought my house recently the EA did a very hard sell on the in house solicitor and financial advisor. I can see how that would be intimidating to a FTB.

I would be against this suggestion. I would also be trying very hard to find out why the previous sale fell through. It sounds like they are desperate to get it shifted quickly and for the same issue not to reoccur.
Are you sure it's not overpriced ? Has your DS had it independently valued ?

illegal

report them

The estate agent I used told my buyer I wanted them to use the agents conveyancers, this was directly contrary to my express instructions to tell them to use anything but that. Fortunately she didn't.

Very illegal! Not just unethical. Look up Conditional Selling on Google.

After mother died and we were selling her flat, the estate agent tried this with us, we insisted on using our own solicitor. There wasn't an onward purchase.

Kick backs for definite.

It is not illegal but it is frowned upon by the SRA because of the chance of conflicts of interest. SRA A firm needs to have all sorts of Chinese Walls in place to do this.
I'd contact the vendor directly and point out the problems, perhaps they don't realise.
If they insisted, I'd walk away. No way would I buy the biggest purchase of my life through a firm who was putting somebody else's interests first.

Absolutely wrong. The agent will get commission from both the conveyancers and financial advisor, plus commission from the house sale.

He's acting illegally and should be reported to NTSEAT.

His remit is to get the best price for the vendor, his client who is paying him. He's clearly lining his pocket and I doubt your DS is the first person he's tried this on.

un ethical in my view, if it came to surveys would the EA insist that their 'tame' surveyor was used?

I have heard of this when buying a boat and it ended badly for the purchaser who was very naive £400k boat

Totally unethical- they would get their knuckles rapped by the regulator if your DS reported them.
The agent will get a referral fee from these firms and clearly wants to make more money. They are probably lying about the seller wanting this; it's probably their preference for the reason given.
I would say no and consider withdrawing the offer. Don't let your DS be pressurised into this.

They are probably lying about the seller wanting this
I agree, or they have talked the vendor into it. It's so they can deny conditional selling.

I would say no and consider withdrawing the offer.
I'd try to cut out the EA and contact the vendor directly.

Our seller tried this on us. The sale went ahead anyway after we refused to back down.

They were a builder who'd taken it as a part exchange property and wanted a quick sale. But we were in a strong position to buy with no chain so we could stand our ground.

I think that's a good idea @senua. Definitely worth considering.

Thank you so much for all of your advice. My DS and his partner stuck to his guns and said he wouldn't use the agency's mortgage advisor and solicitor.

They have just had a call to tell them their offer's been accepted!😀I suspect there was no other bidder.

I gather from a friend that this has happened before with this particular estate agent, and I will look into this further.

They have just had a call to tell them their offer's been accepted!
Yay. Well done for standing strong.

Good for them @measureofmydreams. I think the other buyer may have been a figment of their imagination too!