An angry buying agent has used social media to warn purchasers to “never, ever, ever deal with a mortgage broker who works in or with an estate agent”.
Henry Pryor, who has over 25,000 followers on Twitter, also tweeted: “Mainstream estate agent tells me that if I make an offer my client will need to speak to their mortgage advisor to confirm they have funds.”
On Twitter Pryor identified the firm as Spicerhaart, describing it as “incompetent” and “naughty”. However, last night Spicerhaart said that all procedures had been followed correctly.
Pryor told EYE that his client already had a mortgage agreed in principle (AiP) when he made an offer on their behalf for a property being sold by haart.
The offer was confirmed in writing, together with details of the client, their lawyers, mortgage broker, a copy of the AiP, and details of timing.
Pryor says he was then told the offer could only be put forward after the buyer was ‘qualified’ by a mortgage broker. Details were sent – unasked, says Pryor – to a broker at Just Mortgages, a subsidiary of Spicerhaart.
Pryor complained but forwarded a copy of the AiP to the broker and agent.
The agent then emailed Pryor’s client to ask for their date of birth and copies of bank statements.
Pryor called the haart branch concerned and was told the information was required to make Anti-Money Laundering checks on the buyer.
Pryor was then told by email that haart had not been able to qualify the buyer and that the (by then increased) offer had been rejected.
Pryor told EYE that he had a number of questions including:
- Was there a delay in passing over the offer to the vendor pending qualification by the agent’s own broker?
- Was the seller incorrectly told that the buyer had not been ‘qualified’?
- Was advice given to the seller abut the offer “tainted” by the lack of a mortgage lead?
- Should consent to pass buyers’ details to another company, including subsidiaries, be sought first?
- Why is the buyer’s date of birth required when making an offer?
- Is confirmation from a buyer’s mortgage broker, buying agent or lawyer not good enough for a sales agent to be able to rely on?
- Does a buyer need to be AML checked when making an offer, or once the offer is accepted? When is the start of the business relationship?
- Should an agent really be earning fees from mortgage and conveyancing leads about buyers? Is there a conflict of interest, given that the agent acts for the seller?
Pryor told EYE: “I’m a generous-minded chap, but can we really assume that the Chinese walls between a mortgage broker and a selling agent are soundproof?
“Can a buyer really negotiate if he has had to disclose his financial situation to the other party? Surely it can be done once a deal is agreed?”
We put all these points to Spicerhaart and last night chief executive Paul Smith told EYE: “We cannot comment on the specific details of this case due to client confidentiality but can confirm that all procedures were followed correctly.
“We comply with Anti Money Laundering regulations and our processes are tried and tested with thousands of transactions every year.
“This includes running an identity check on a purchaser, for which we require their date of birth. This takes place once their offer has been accepted and technically forms the start of the business relationship.
“In order to progress any house sale, it is vital that we check that all prospective purchasers have the means to buy the property in question. Many transactions fail at the last hurdle because other agents do not go through this process.
“Our procedures ensure that any potential buyers are qualified before an offer is put forward and this is undertaken within a minimum time frame. If the offer cannot be qualified within that time frame, the offer is put to the vendor with the caveat it still needs to be substantiated.
“We do accept confirmation of an Agreement in Principle from a mortgage broker as a good enough basis for a positive offer substantiation. If this detail were to be supplied by a buying agent or lawyer it would also be acceptable. We also in some instances double check.
“We always obtain consent to pass buyers’ details to another company, or subsidiary, within our group and this is recognised specifically in our offer documentation where approval is sought and granted verbally at registration. Buyers are in no way obligated to use our financial services but can choose to do so.
“Under no circumstances would we say that an offer can only be accepted if we have substantiated it or that the buyer has to arrange their mortgage with us.
“We have an effective complaints procedure if any client believes we have not followed our procedures correctly.”
The letter from haart turning down both offers from Pryor’s client is below.