Estate agent wants evidence of money

T

Tim Robbins

Registered User
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51
Hi,
we put in an offer for a house that is nearly finished. Another couple pulled out an the real estate agent is paranoid. The estate agent already asked for evidence we have mortage approval and we gave her a photocopy of being approved in principle and scribbled out some of the digits as we that it was a bit of an invasion of privacy.

We have agreed price but the estate agent is now asking for the unscribbled out version of the approval in principle.

I think we are paying over the odds for house. We have to move because of personal circumstances that is the reason why we are buying it - not because it is good value.

When I do business I like there to be good will on both sides. Part of me doesn't mind giving the real estate agent the unscribbled out version but another part finds it very annoying.

We are under no legal obligation to do this. But then again nothing is under legal obligation until you actually sign for the deeds. My unerstanding is that when you pay a booking deposit, the estate agent, developer can still shaft you as these things have no legal standing. There are just gentleman's agreements.

So I would appreciate some advice here.

many thanks
 
Tim Robbins said:
I think we are paying over the odds for house. We have to move because of personal circumstances that is the reason why we are buying it - not because it is good value.
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Is this the only house for sale in the area that you want?? You shouldn't pay over the odds in the most depressed market in decades...

Tim Robbins said:
When I do business I like there to be good will on both sides. Part of me doesn't mind giving the real estate agent the unscribbled out version but another part finds it very annoying.
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I wouldn't give them anything and I would let them know that their behaviour is putting you off buying the house.


Tim Robbins said:
My unerstanding is that when you pay a booking deposit, the estate agent, developer can still shaft you as these things have no legal standing. There are just gentleman's agreements.
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That's right.

My 2c's, for what its worth:

1) Find a house you want
2) Make an offer you think it's worth
3) Offer accepted - the house is yours
Offer declined - return to step 1) with a different house
4) Repeat til house bought
 
gianni said:
Is this the only house for sale in the area that you want?? You shouldn't pay over the odds in the most depressed market in decades...
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We have to buy now for personal reasons. And yes we are paying over the odds. There are other houses and this is the one that ticks most of the boxes.
 
Tim Robbins said:
We have to buy now for personal reasons. And yes we are paying over the odds.
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This doesn't make a lot of sense. Could you explain a bit more?

can you not rent now for personal reasons?

It must be a very odd situation if you are deliberately paying over the odds. You should focus on this rather than on the attitude of the estate agent.

Brendan
 

My wife is pregnant with number 2. It is also difficult to rent places where we live. There are not too many. Ideally I would like to wait until at least the house price register but the house we want would be gone by then.

Also, this is not an economic decision but a lifestyle one. I don't care if house drops by another 30K. It's pittance compared to what we have already lost.

Just want my family to be happy.
 
Renter7 said:
You would be very silly to pay over the odds for a house.
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Agree 100% rent for a year if necessary but do not pay over the odds,its madness,would you go to Superquinn and pay 20% more for your weekly shopping than anyone else?

You say the house is nearly finished,is this a Nama /Ghost estate?

The E/A is being a bit jobsworth about the redacted loan approval, don't walk away...RUN.
 

All houses are over priced if you compare the rental price to the purchase price. As I said this isn't just an economic decisions.

Anyway, can anyone answer the original question?

Thanks.
 
I am in a similar position i.e. being asked to provide proof of mortgage approval and like you the only proof I currently have is the approval in principle, which is for more than what I will need to borrow for this house. I am not too concerned about the invasion of privacy. I am however wary that this is in some way 'revealing my hand' i.e. if this purchase were to fall through, then this agent will know what I have to spend. Fortunately the particular agent involved does not have many properties for sale in the area I want to buy, so I will probably just go ahead and give them the letter.

Just to mention, the agent did also say that confirmation of approval from a broker or the bank would suffice, so maybe if you can get that from either of these sources confirming that your approval covers the purchase price, this might be acceptable to the agent.

Also, just to say that in some ways I agree with the requirement for this proof, having seen three houses in one estate sell for inflated prices in a very short time span because the first house received a very high bid and went sale agreed. The bidder wasn't approved and the sale eventually fell through but only after the other two houses sold for over the odds.
 
It seems to me that the estate agent is being quite unreasonable. The unredacted version of your approval letter might reveal that you have more funds available to you than the agreed price. The EA and the vendor should not know that, as they could use that information to screw you over.

Play hardball; purchasers with funds should be cherished.
 
Tim Robbins said:
Anyway, can anyone answer the original question?
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I think it is reasonable for the agent to satisfy himself that you are in a position to buy.

There are many who make offers but for a variety of reasons could not yet complete the purchase.

If I was selling I would only consider offers from those that could show insofar as possible, they were in a position to complete the purchase.

I once had a loan approval certificate which was more than the agreed price for the house I was buying. My bank had no problem giving me a letter stating I had approval to complete a purchase of €xxxxx, the agreed price, that way had the sale not gone through for any reason, I had not shown my hand.

A friend in a similar position asked his bank, the manager said get the agent to ring and he would simply confirm my friend had sufficient funds to complete a purchase of €xxxx, this was accepted by the agent.

Nothing is binding though until contracts are signed by both parties.
 
Your bank/mortgage broker should be be able to provide you with a letter/e-mail stating that given the amount of the mortgage for which you have been approved, coupled with the deposits at your disposal, you have sufficient funds in order to complete the purchase at the agreed price.

If you need to sell in order to buy, you'd be better off selling first.

If you really think you're paying over the odds, you need to reduce your offer. If they are not willing to sell at the lower offer, how can you be sure you're paying over the odds? It sounds like your wife wants the house at the agreed price.

It may be a buyers' market but there is excess demand in certain locations and for certain houses. If there are no houses selling that tells you that the people who own these houses aren't willing to sell at the implied market price. There is then no real market price.
 
There's no obligation on you to give any proof at all of ability to pay, legally. But there is no obligation on the Vendor to sell to you either and they can impose whatever conditions they want, it's up to you to accept or not.

Firefly's suggested compromise is a good one- your solicitor would be able to confirm that you have been approved for an amount sufficient to buy the house if you show them the approval and that means you don't have to show it to the estate agent.
 

Issue with that is that amount is likely to be *much* higher than the amount they want to close at. I know in my case, it took a lot of effect to get the application amount set as low as it did, and even that is a fair bit above the max amount I want for a mortgage.
 
If I was a seller, I would instruct the EA to refuse any offer which did not provide clear evidence of ability to pay. Too much risk that by accepting an offer which could not conclude, I might have to refuse a good offer
 
Does the estate agent have a manager who they report to? I'm sure a more experienced agent would see sense, as they would not wish to miss out on the sale.
 
As a broker, clients frequently request such a letter. We have a standard text that says "We have seen evidence that Mr & Mrs Robbins have sufficient funds, in conjunction with the mortgage for which they have been approved, to complete the purchase of 123 Main Street at the agreed price of €X." We don't ever reveal how much the clients actually could afford and we've never been asked for it.
 
In my humble opinion this is all a bit of a nonsense on both sides. Having 'evidence' of approval in principle or even a letter of offer means nothing these days, the sale can still fall through.

Letters of offer can have all sorts of conditions attached (e.g., irrevocable sale of current property) which may prevent the purchaser going ahead at the last minute. For that reason, there is now a clause in most contracts for sale saying that the buyer should be able to get their full deposit returned, even after contracts have been signed, in the event that they cannot draw down funds through no fault of their own (i.e., in recognition that banks are playing silly beggars).
 
Estate agent asked again and we didn't show. My main gripe was I thought it was just nosy. I am not asking them for finacial records to prove they have enough money to finish the estate.

If they were being exceptionally nice then I wouldn't have a problem.
 
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