Estate Agent Terms & Conditions - Buyer pays commission???
Discussion
Morning All
My sister in law is looking for a flat and has been phoning up agents to arrange viewings. One of the agents sent her back a long email detailing their terms and conditions. Basically, they seem to be charging the buyer commission rather than their seller, implying that you'll get it back through a lower price that they'll negotiate for you.
Anyhoo, thought I'd get the PH view on things.....
Dear Ms xxxx
Thank you for registering with <the agent> Buyers Agency. Our aim is to provide you with a faster, more effective property buying service which exceeds your expectations.
<the agent> buyers agency is a unique service in the market which benefits buyers and sellers and goes a long way towards solving the traditional problems associated with buying or selling property in England and Wales. As a buyer you benefit from a greater selection of properties for sale through <the agent>, and because we do not charge our sellers, they are happy to instruct us so we have the biggest property register in the area.
In addition, if we don’t have a suitable property for you, we are pro-active in going out and finding one. Once you have decided on a property you like we negotiate on your behalf with the seller, because the seller does not pay us a fee, we are able to help you achieve a lower price than you would otherwise pay if you bought through a traditional seller’s agent.
One of the biggest reasons people get stressed by buying or selling property is the lack of certainty in the process and the possibility that either party will pull out at the last minute. As we take a reservation fee at the point your offer is accepted, the seller is more confident that you are serious and they are more likely to reject other offers from less serious buyers who do not make a commitment, so both sides are better off.
Since establishing our buyers agency it has been a big hit with buyers and sellers and we think that we have significantly improved the buying and selling process for everyone. If you agree and if you enjoy the experience of buying through <the agent>, all we ask is that you recommend us to your friends and family.
If on the other hand our service or our people do not come up to your expectations we would like to hear from you, because only through feedback from our clients can we continue to monitor our standards and improve our service still further.
Please find enclosed our terms and conditions of business, please look at them carefully and do not hesitate to contact us with any questions you may have.
Kind regards
This agreement is between <the agent> Estate Agents Ltd Reg. No xxxx (<the agent>) and Ms xxx service of the agreement to be made to xxx@xxx.com.
1: Services to the buyer
For the duration of this agreement <the agent> agree to use their reasonable endeavours to assist the buyer(s) in finding suitable property and negotiating the terms of the sale on the most favourable basis for the buyer.
2: Marketing and Advertising
Until otherwise instructed by you in writing, we reserve the right to market and advertise your full name, budget and property purchasing requirements as agreed from time to time.
3: Fees
The buyer(s) hereby appoint <the agent> to represent them exclusively on all negotiations for the purchase of property introduced by <the agent> for the duration of this agreement
For the duration of this agreement the buyer(s) agree to pay <the agent> a commission of 1.5%+vat of the purchase price of any property purchased by them while this agreement is in force or on which negotiations for purchase are commenced and where the purchase takes place within one year of this contract ending.
<the agent> fee will be earned on exchange of contracts on the purchase, or if the buyer fails to perform in accordance with clause 7: ‘Special Provisions’
In the event of an act of bad faith by the buyer(s) where negotiations take place in contravention of this agreement <the agent> commission will be increased to 3% Plus vat and will become due immediately the negotiations come to light irrespective of whether or not they result in the purchase of the property.
<the agent> agree to deduct from the buyer’s commission any fee if any charged to the seller by any member of the <the agent> group of companies.
4: Services to Prospective Sellers
<the agent> may offer Sellers services relating to the purchase of property by you. These services may include Mortgages, insurance, sales conveyancing, sellers and buyer’s agency services. We will inform you if a seller asks us to perform any such service.
5: Personal Interest
We must by law disclose to a prospective Seller any business or family relationship which you may have with <the agent>, or any employee of <the agent>, or any associated company. If you are aware of any such relationship please specify below.
………………………………………………..
6: Termination
This agreement may be terminated by either party by giving the other party four weeks notice in writing.
7: Special Provisions
Once their offer has been accepted by the seller, the buyer will pay to <the agent> an agreed holding fee. Should the buyer perform but the vendor pull out of the sale this fee would be refundable in full. Should the buyer withdraw from the sale for any reason other than the vendor’s failure to perform, or the property failing to value at the purchase price, or not being considered adequate security for a mortgage without retention, or for any other reason agreed in writing prior to the offer being accepted, this fee will be deemed to have been earned and therefore not refundable. The balance of our fee of 1.5%+vat will become payable to us by the buyer within 5 working days of termination of purchase of any property.
8: Option to add <the agent> fee to the purchase price of the property:
Where explicitly agreed and confirmed in writing to the buyer by <the agent> the buyer's fee can be added to the purchase price of the property. In these circumstances the balance of <the agent> fee minus the holding fee will be paid by the seller on the buyer’s behalf upon exchange of contracts.
Unless otherwise agreed in writing, going on a viewing arranged by <the agent> shall be deemed as Acceptance of these terms and conditions by the buyer.
My sister in law is looking for a flat and has been phoning up agents to arrange viewings. One of the agents sent her back a long email detailing their terms and conditions. Basically, they seem to be charging the buyer commission rather than their seller, implying that you'll get it back through a lower price that they'll negotiate for you.
Anyhoo, thought I'd get the PH view on things.....
=====================================================
Dear Ms xxxx
Thank you for registering with <the agent> Buyers Agency. Our aim is to provide you with a faster, more effective property buying service which exceeds your expectations.
<the agent> buyers agency is a unique service in the market which benefits buyers and sellers and goes a long way towards solving the traditional problems associated with buying or selling property in England and Wales. As a buyer you benefit from a greater selection of properties for sale through <the agent>, and because we do not charge our sellers, they are happy to instruct us so we have the biggest property register in the area.
In addition, if we don’t have a suitable property for you, we are pro-active in going out and finding one. Once you have decided on a property you like we negotiate on your behalf with the seller, because the seller does not pay us a fee, we are able to help you achieve a lower price than you would otherwise pay if you bought through a traditional seller’s agent.
One of the biggest reasons people get stressed by buying or selling property is the lack of certainty in the process and the possibility that either party will pull out at the last minute. As we take a reservation fee at the point your offer is accepted, the seller is more confident that you are serious and they are more likely to reject other offers from less serious buyers who do not make a commitment, so both sides are better off.
Since establishing our buyers agency it has been a big hit with buyers and sellers and we think that we have significantly improved the buying and selling process for everyone. If you agree and if you enjoy the experience of buying through <the agent>, all we ask is that you recommend us to your friends and family.
If on the other hand our service or our people do not come up to your expectations we would like to hear from you, because only through feedback from our clients can we continue to monitor our standards and improve our service still further.
Please find enclosed our terms and conditions of business, please look at them carefully and do not hesitate to contact us with any questions you may have.
Kind regards
This agreement is between <the agent> Estate Agents Ltd Reg. No xxxx (<the agent>) and Ms xxx service of the agreement to be made to xxx@xxx.com.
1: Services to the buyer
For the duration of this agreement <the agent> agree to use their reasonable endeavours to assist the buyer(s) in finding suitable property and negotiating the terms of the sale on the most favourable basis for the buyer.
2: Marketing and Advertising
Until otherwise instructed by you in writing, we reserve the right to market and advertise your full name, budget and property purchasing requirements as agreed from time to time.
3: Fees
The buyer(s) hereby appoint <the agent> to represent them exclusively on all negotiations for the purchase of property introduced by <the agent> for the duration of this agreement
For the duration of this agreement the buyer(s) agree to pay <the agent> a commission of 1.5%+vat of the purchase price of any property purchased by them while this agreement is in force or on which negotiations for purchase are commenced and where the purchase takes place within one year of this contract ending.
<the agent> fee will be earned on exchange of contracts on the purchase, or if the buyer fails to perform in accordance with clause 7: ‘Special Provisions’
In the event of an act of bad faith by the buyer(s) where negotiations take place in contravention of this agreement <the agent> commission will be increased to 3% Plus vat and will become due immediately the negotiations come to light irrespective of whether or not they result in the purchase of the property.
<the agent> agree to deduct from the buyer’s commission any fee if any charged to the seller by any member of the <the agent> group of companies.
4: Services to Prospective Sellers
<the agent> may offer Sellers services relating to the purchase of property by you. These services may include Mortgages, insurance, sales conveyancing, sellers and buyer’s agency services. We will inform you if a seller asks us to perform any such service.
5: Personal Interest
We must by law disclose to a prospective Seller any business or family relationship which you may have with <the agent>, or any employee of <the agent>, or any associated company. If you are aware of any such relationship please specify below.
………………………………………………..
6: Termination
This agreement may be terminated by either party by giving the other party four weeks notice in writing.
7: Special Provisions
Once their offer has been accepted by the seller, the buyer will pay to <the agent> an agreed holding fee. Should the buyer perform but the vendor pull out of the sale this fee would be refundable in full. Should the buyer withdraw from the sale for any reason other than the vendor’s failure to perform, or the property failing to value at the purchase price, or not being considered adequate security for a mortgage without retention, or for any other reason agreed in writing prior to the offer being accepted, this fee will be deemed to have been earned and therefore not refundable. The balance of our fee of 1.5%+vat will become payable to us by the buyer within 5 working days of termination of purchase of any property.
8: Option to add <the agent> fee to the purchase price of the property:
Where explicitly agreed and confirmed in writing to the buyer by <the agent> the buyer's fee can be added to the purchase price of the property. In these circumstances the balance of <the agent> fee minus the holding fee will be paid by the seller on the buyer’s behalf upon exchange of contracts.
Unless otherwise agreed in writing, going on a viewing arranged by <the agent> shall be deemed as Acceptance of these terms and conditions by the buyer.
I am aware of a family owned and run agency operating in Surrey (with a very cheap and cheerful marketing approach - both of itself and its properties - has a name "something" like Options, I forget...) which I am told has a similar operating model. This agency tends to appeal to a certain type of clientele, and since it has been in business for many years now must be doing something right. Right for itself that is.
Anecdotally most potential clients are immediately suspicious (but curious) as to how it works. Many walk away, but like I say, this particular agency appeals to a certain type. I have no direct experience of how potential buyers view it.
Anecdotally most potential clients are immediately suspicious (but curious) as to how it works. Many walk away, but like I say, this particular agency appeals to a certain type. I have no direct experience of how potential buyers view it.
scenario8 said:
I am aware of a family owned and run agency operating in Surrey (with a very cheap and cheerful marketing approach - both of itself and its properties - has a name "something" like Options, I forget...) which I am told has a similar operating model. This agency tends to appeal to a certain type of clientele, and since it has been in business for many years now must be doing something right. Right for itself that is.
Anecdotally most potential clients are immediately suspicious (but curious) as to how it works. Many walk away, but like I say, this particular agency appeals to a certain type. I have no direct experience of how potential buyers view it.
That's the one!Anecdotally most potential clients are immediately suspicious (but curious) as to how it works. Many walk away, but like I say, this particular agency appeals to a certain type. I have no direct experience of how potential buyers view it.
My sister in law cancelled the viewing appointment as that would mean accepting their Ts and Cs. She was told, "I don't understand your concerns....you're the first person who's had a problem with our terms". Hmmm.
Obviously, your sister in law may wish to see if it is being joint/multi agency marketed.
As an aside, if it were the case above, I wonder what legal position your sister in law and/or the vendor would be in regarding the fee, were a sale to ensue..?
ETA I'd better be careful in what I say as the owners "may" be quite an aggressive bunch and I imagine wouldn't be slow off the mark in litigation.
Not that I know who they are, of course.
As an aside, if it were the case above, I wonder what legal position your sister in law and/or the vendor would be in regarding the fee, were a sale to ensue..?
ETA I'd better be careful in what I say as the owners "may" be quite an aggressive bunch and I imagine wouldn't be slow off the mark in litigation.
Not that I know who they are, of course.
Edited by scenario8 on Thursday 19th August 13:45
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