The Daily Telegraph claims that what it calls “dodgy practices” are leaving customers “thousands of pounds out of pocket.”
The article quotes an agent called Jenny - not her real name, apparently - as saying that because agents now market a range of services and not just selling and buying homes, they are offering poor value to vendors and purchasers alike.
“They put this blind faith into their estate agent and that is being abused, pure and simple ... Most people only go through this process two or three times in their life. They don’t know enough to understand what is being done to them.”
Jenny, and the newspaper, appear to be particularly critical of agents which have links with mortgage sales.
The article claims that sellers are losing money because they are being deliberately put off high bids from buyers with independent mortgages. Instead, claims Jenny, sellers will go with a buyer making a lower offer after being advised by the estate agent that there is more certainty behind the deal.
“So you just put both offers to the homeowner and say: ‘This one offered £2,000 less but they are doing everything in-house and it is far more likely [the sale] will go through. If you go with the person who’s offered £2,000 more, they are using their own solicitors and their own mortgage services so we can’t make any guarantees.’”
She adds that some vendors agree only to accept offers ‘financially verified’ by the selling agent. The paper suggests this gives the agent free rein to reject independent buyers outright.
Jenny is described as working at an agency in south east England and she claims that at her firm buyers are told they can get a £1,000 discount if they use in-house mortgage and conveyancing services.
Worse still, the claim then says buyers are also told that if they operate through the agent’s mortgage broker they will gain special access to a “premium buyer’s list”.
The piece goes on to quote Jenny’s accusations that data protection is lax because confidential conversations take place in open offices with paperwork handled in a sloppy manner.
Although the Telegraph does not identify the agency Jenny works for, it says that the company makes £600 from each buyer who takes out a mortgage through the firm, as well as commission from the mortgage lender.
“It brokered £4.4bn of mortgages in 2014 – more than the £4.3bn it sold in property” says the newspaper.
You can see the article here.