Estate Agent want 1% commitment fee from buyer, heard of this?

[Jemm]

Hi everyone,

I recently offered on a property, and this was excepted. However, the Estate Agent has said they want me to pay 1% to them as a commitment fee, which if I pull out of the sale, I lose! Surely this isn't right. I am waiting for solicitors and my mortgage advisor to come back with advice, and I have asked them to speak directly to the agent as I have no knowledge to argue with them. So far nobody has heard of such a fee before, they are essentially holding the property to ransom at the moment, saying they will not send the memo pack to my solicitors unless i pay! Surely not legal?

 

[tony84]

Some agents try this on. Dont do it.

The reason you are not financially committed until the legals and valuation have been completed is incase something negative crops up. What happens if it turns out the property is leasehold with 10 years left or if there is a coal mine under the back garden? (both of those would need reporting to the mortgage lender meaning your mortgage offer gets pulled).

Speak to the vendors if necessary, this wont be anything to do with the vendors.

Also report it trading standards - they need pulling up on this to stop other people falling for it. I dont want to say it is a con, but its close to. There is no benefit for the buyer what so ever to do this.

 

[IanSuth]

Hi everyone,

I recently offered on a property, and this was excepted. However, the Estate Agent has said they want me to pay 1% to them as a commitment fee, which if I pull out of the sale, I lose! Surely this isn't right. I am waiting for solicitors and my mortgage advisor to come back with advice, and I have asked them to speak directly to the agent as I have no knowledge to argue with them. So far nobody has heard of such a fee before, they are essentially holding the property to ransom at the moment, saying they will not send the memo pack to my solicitors unless i pay! Surely not legal?

Pretty sure they are legally obliged to pass on all offers

Have a look at this page (it has the complaints links as well) https://www.sold.co.uk/estate-agents/what-legal-obligations-do-estate-agents-have-to-buyers

Passing on Offers to the Seller​

Estate agents are legally obligated to pass on all offers to the seller. They must pass on all offers all the way up to contracts being exchanged and the sale is finalised. Estate agents must inform sellers of offers in writing – either letter, email, or fax – and they must be passed on promptly from the offer being made. This means that anytime a buyer makes a formal offer, the seller must be notified about it.

The only exception to an offer being passed on to the seller is if the seller has formally requested to not be informed of certain offers. For example, they may ask the estate agent not to pass on offers that are below a certain amount.

Not Showing Bias To or Against Buyers​

Estate agents are legally required to not show any bias to or against any individual buyers. This means that all buyers will be treated the same and will have the same conditions. For example, estate agents will not be allowed to ask one buyer to hold a mortgage in principle before the offer is passed on, and not have this same condition for other buyers. Estate agents will also not be allowed to refuse to pass on information to a particular buyer, or take longer to send on requested information with one buyer compared to any others.

In an effort to reduce the risk of bias, estate agents are legally obligated to declare whether they have any connection to a party in the sale, whether that be the seller or another buyer.

 

[IanSuth]

@greengriff would be the go to person to give advice on the actual legalities etc i would guess

 

[Jemm]

Thanks for the replies so far. Also just realised my error, the offer was accepted not excepted! Quite different.