Conditional selling: Don’t be forced into using an estate agents ‘in house‘ mortgage advisor, or solicitor.
This practice is known as ‘Conditional Selling’ and is illegal. It takes all control away from you, and could result in a ‘conflict of interest’.
Don’t be forced into something you are not comfortable with. It’s long been against the law for agents to say that you must use their own mortgage broker, conveyancing solicitor, or any other type of financial service that they may also provide.
How to spot it.
Sales agents are well within their rights to ‘TRY’ and sell their in house services, but sometimes this becomes ‘You MUST use our mortgage broker or conveyancing solicitor‘. It is completely unacceptable, and actually illegal, if you are told there will be any negative consequences if you don’t play ball.
If you ever hear any of the following, alarm bells should really start to ring!
”As you are not using our in house broker, your offer won’t be submitted to the seller as quickly as those who are”.
FACT: Estate agents are legally bound to submit all offers to a seller.
”Our in house broker offers are fast tracked, so yours is less likely to be accepted”.
FACT: Agents are not allowed to discriminate between offers. An estate agent should never encourage a seller to favour a buyer using in-house services.
”Because you are using your own broker you will hear about new properties later”.
FACT: Agents are not allowed to make the sharing of properties coming to market conditional that you use their in-house services.
So why do some agents operate like this ??
The simple answer is money! An agent that passes a mortgage or solicitor lead will typically receive a referral fee. Industry insiders say that this referral fee can be as much as 60% of the total ‘in-house’ fees that you pay.
The last thing you want is a conflict of interest! If you and the seller both use the estate agent’s in-house solicitors/brokers, this could represent a conflict of interest. For example, you might have less scope to negotiate on the property price if, hypothetically, the details of your budget were to reach the seller.
Always make your own choices, and select exactly who you want to work with. Don’t be pressured by bully boy tactics!
