Many estate agents ‘fail to check buyers have funds in place’
Nearly a third of homebuyers do not have funds in place when they make an offer, and many agents are not making checks, new figures show.
A shocking number of homebuyers do not have the necessary funds or a mortgage offer when they have a bid accepted, new figures show.
The latest research from House Buyer Bureau found that 29% of homebuyers who make an offer on a property are not actually in a position to proceed.
Many lack either a mortgage in principle, a deposit, enough saved to cover Stamp Duty and buying costs, or all three.
Never asked
And more than a third – at 38% – are never asked to prove they have the funds in place.
More than half – at 55% – of buyers do not have a mortgage in principle in place when they first started enquiring about properties.
Meanwhile, 62% said that the seller or estate agent was aware that they did not yet have the required funds in place.
Transactions collapsed
Perhaps more worryingly, 69% of those who did not yet have all of the required funds in place still proceeded with the purchase after their offer had been accepted.
Only 11% completed as planned, while 25% said that their exchange of contracts was delayed and 52% saw their completion date pushed back. In 12% of cases, the transaction collapsed altogether.
The industry should be doing far more to protect sellers from this situation.”
Chris Hodgkinson, MD at House Buyer Bureau, “For sellers, there is nothing more frustrating than accepting an offer, taking the property off the market, and beginning to make plans for your onward move, only to discover weeks later that the buyer was never actually in a position to proceed.
“The industry should be doing far more to protect sellers from this situation and estate agents, mortgage advisers, and solicitors all have a role to play in ensuring that buyers are properly qualified before an offer is accepted and a sale is allowed to progress.”
