Problem with Auctioneer

We are selling an investment property we bought back in 2003.

Thankfully we have had quite a lot of interest in the house and it sold within two weeks of being on the market.

My husband expressed his concern at the time that he felt the house was being sold quite cheaply but the auctioneer advised we should take the offer that the prospective buyers had put on the table.

Our solicitor arranged contracts and we’ve just been waiting on feedback from the buyer’s solicitors . . .

Well that was four weeks ago and we have just heard this evening that the contracts have been signed (but not returned to our solicitor) as the buyers are still waiting on mortgage approval.

We are completely shocked by this as the auctioneer had told us time after time that the buyers had mortgage approval.

Where do we go from here?

It may just be a mistake in terminology- the buyers may have had 'approval in principle' but now have to have actual offers issued. I wouldn't necessarily rush to hang the auctioneer either way- they may have been misinformed.

Yeah I imagine the buyer's had approval in principle only. A bank won't sanction the mortgage (i.e. make formal offer) until a valuation has been done. This is usually after an offer has been accepted by seller.

I'm amazed their solicitor let them sign without have the finance behind it. Big no no imo.

Thank you both for your replies.

Unfortunately the auctioneer in question had turned away prospective buyers with “approval in principal” as he was adamant that these present buyers were the real deal. We even have in writing him stating he had seen their mortgage approval.

I can't believe it either that their solicitor allowed them to sign contracts. I have never heard of this before; unless he is 100% certain they will get full approval but even that has been unheard of.

You should tell him first thing Monday morning to keep marketing the property. In the present market a property is not sold until both parties sign the contract. The Auctioneer could be doing one of his mates a favour you know.

Johnny, my husband from day one has thought the very same as what you have just said.

It was due to my stupidity that he was kept as sole seller of the property due to the fact that he knew the area very well etc.

Well, the best thing is now you have admitted your own mistake, is to have the property remarketed either through the same agent or another agent. Even in a difficult market, there is nothing worse than feeling you have been done.

johnny1234 said:

Well, the best thing is now you have admitted your own mistake, is to have the property remarketed either through the same agent or another agent. Even in a difficult market, there is nothing worse than feeling you have been done.

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The funny thing is they accepted the offer and they have the final say. The EA must have serious powers of persuasion to make them accept an offer that they were not happy with within 2 weeks of going to the market. It is 6 weeks since being on the market now and the deal hasn't been tied up, that is in keeping with the normal run of things. Vendors often feel they should get more when a deal happens quickly and when they decide to wait for someone else sometimes they are looking back on that decision 6 months down the line with regret.
To the OP I say if you don't trust your EA then dump him, but so far he doesn't seem to be doing badly in getting interest going and an offer. It's your property so you make the call and at least you will only have yourself to blame if it goes wrong or you could be vindicated with a better deal.

Hi there,

I think you are over-reacting a bit. It is not at all unusual for purchasers to lie about their status vis a vis finance etc. I am trying to close a sale at the moment where the purchasers did just that. The other possibility is that the purchaser had a loan offer, but are working to get a better/more suitable offer from another lending institution.

Frankly, in this market it is so difficult to get any purchaser to commit, that I think your auctioneer jumped at a genuine offer. I don't blame him. At the end of the day, you are selling your property in a very short period of time in the worst market we have had in a very very long time, for a price that you can live with. Not too shabby!!

Kate

Thank you all for your replies.

Our main gripe is the auctioneer turning away further interested parties in the property as he is adamant the initial purchasers will come up trumps with their loan offer. It will be seven weeks this coming Friday since they received contracts.

I left a note in the auctioneers door Friday evening asking him to put the For Sale sign back up. He contacted me this morning and said he thought this was un-wise as it may frighten the purchasers away . . .

And you can see the replies. Its your call. You make your own mind up. If you truly do not believe your auctioneer and if you truly think that someone else will pay more for the property, then put it back on the market. Either with the same EA or a new one. It really is that simple.

mf

Just an update guys: The proposed purchasers mortgage application fell through this morning. Even though it was inevitable at this stage it did come as a shock.