EA requests during bidding

ant2

hi all,
I have few questions, maybe someone could help me:
- EA asked me for mortgage approval because, like he said, the owner of house wants to see it. I can give it to EA but EA third party?
- EA decide on if the price is expected to rise during the negotiations, (I gave an offer, someone beaten my offer, I wanted to beat 500 e, but the agent said that I can not and the minimum amount to raise is 1000 e)
- does EA has right to ask me for statement bank (eg. if bank approved is for 120k and house costs 150k. Does EA can ask for bank statement if I have enough money - 30k plus rest fees).
Thank you for any answers,
Have a nice day

axcel

ant2 wrote: »

hi all,
I have few questions, maybe someone could help me:
- EA asked me for mortgage approval because, like he said, the owner of house wants to see it. I can give it to EA but EA third party?
- EA decide on if the price is expected to rise during the negotiations, (I gave an offer, someone beaten my offer, I wanted to beat 500 e, but the agent said that I can not and the minimum amount to raise is 1000 e)
- does EA has right to ask me for statement bank (eg. if bank approved is for 120k and house costs 150k. Does EA can ask for bank statement if I have enough money - 30k plus rest fees).
Thank you for any answers,
Have a nice day

- Data protection wise estate agent has to get your permission to show it to a third party. So if you give it to him and he's advised you that's why, you essentially giving him permission. If you giving it to the agent, there's not much difference in the seller seeing it. I wouldn't like to give them notice of how much I'm approved for if it's more than your current bid,better off asking the bank for a letter specifying the amount you are bidding or they will probably try and take you for more ( I'm just assuming based on the fact the estate agent seems like an ass).
-Minimum bid does not have to be 1000, that the estate agent taking the p*ss! I can't be sure on this, but thought there's a requirement for the estate agent to pass on any offers to the owner so don't stand for that. We bid €500 more at one stage. It didn't work out for us in that case but nothing to stop you doing it.
-As with the mortgage approval and the bank account the agent can ask for anything, but there's no requirement you have to provide it. It's a personal choice and you are kind of at the mercy of the demands of estate agent and seller if you really want the house. Unfortunately if client won't sell the house without seeing these things, you are stumped. Personally I think it's a step too far for them to ask for your bank statement. Don't let them push you around anyway, I know it's likely a seller's market where you are but you're still the one with the money so I'd just be confident. You's up to you how you feel letting them see your bank account.

Denny_Crane

Literally just off Skype with the in-laws. Chatting away about offer on the house, all excited they're soon to be moving over.

'Oh we've told the agent to only accept offers once they're sure everything is in place'.

All I'm saying is look at it from the vendor's point of view. You have every right not to co-operate of course.

JustLen

You dont havee to provide him with anything.
You wont get far if you dont play ball. Its up to you.

Just dont let him know how much you are approved for as mentioned above.

A good agent wont accept bids without proof of funds.

Parchment

i would never give an EA a bank statement. All i ever gave an EA a letter from my bank confirming i had been approved for the amount sought - never with an actual figure.

Askthe EA

Just on this, while everybody assumes that proof of funding is used to squeeze every last penny out of you, there is a plus. A reputable agent will ask for proof of funding off every bidder. This prevents someone else from bidding you up when they are not in a position to cover there bid. Assuming that you will get credit and actually getting it are two separate things.

Most EAs simply want the deal to progress smoothly as if the sale falls and they have to go back to market, it eats into their profit.

Parchment

Askthe EA wrote: »

Just on this, while everybody assumes that proof of funding is used to squeeze every last penny out of you, there is a plus. A reputable agent will ask for proof of funding off every bidder. This prevents someone else from bidding you up when they are not in a position to cover there bid. Assuming that you will get credit and actually getting it are two separate things.

Most EAs simply want the deal to progress smoothly as if the sale falls and they have to go back to market, it eats into their profit.

But the letter, if it shows an amount, only shows what the bank is giving you. Some people have huge savings that they can use to bid with too so i dont see the letter showing who can and cant bid an amount as it only shows part of most peoples funding.

Askthe EA

Parchment wrote: »

But the letter, if it shows an amount, only shows what the bank is giving you. Some people have huge savings that they can use to bid with too so i dont see the letter showing who can and cant bid an amount as it only shows part of most peoples funding.

Indeed, and all we care about is that the bidder can cover their bid. As long as the letter covers the purchase price, were not pushed where the rest comes from.

Parchment

Askthe EA wrote: »

Indeed, and all we care about is that the bidder can cover their bid. As long as the letter covers the purchase price, were not pushed where the rest comes from.

You missed my point - the bank may only be loaning a small percentage of the cost of the house, the rest may be in savings which cannot be seen on the letter as it only represents what the bank is lending.

Parchment

Parchment wrote: »

You missed my point - the bank may only be loaning a small percentage of the cost of the house, the rest may be in savings which cannot be seen on the letter as it only represents what the bank is lending.

Then get a solicitor to write the letter, based on the bank letter and the additional sources which you can tell them about.

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Askthe EA

Deleted User wrote: »

Then get a solicitor to write the letter, based on the bank letter and the additional sources which you can tell them about.

I wouldnt accept a letter from a solicitor, they can only rely on what you tell them. I have accepted emails (official email address) from bank staff and accountants though. As I said, all we care about is the bid can be covered.

Askthe EA

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Surely the MAIP showed the amount they were prepared to lend to you?

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Askthe EA

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Which is why we ask for it in the first place. I wouldnt accept a figure blanked out, Im surprised they did.

Moomintroll99

What about a cash buyer? Would they seriously ask you to show a bank statement with the cash in there? What if you had a million quid but the house was a fraction of that?

Askthe EA

Moomintroll99 wrote: »

What about a cash buyer? Would they seriously ask you to show a bank statement with the cash in there? What if you had a million quid but the house was a fraction of that?

Considering its standard practice in all commercial transactions they tend not to blink when asked. So yes of course. As I said, doesn't have to be a bank statement, letter from a bank or accountant confirming they can cover the bid is normally acceptable

listermint

Askthe EA wrote: »

Considering its standard practice in all commercial transactions they tend not to blink when asked. So yes of course. As I said, doesn't have to be a bank statement, letter from a bank or accountant confirming they can cover the bid is normally acceptable

Bid weird tbh why would a bidder bid on a house they can't pay for...

I can understand of they haven't got mortgage approval and are pre bidding. But if you have been given the mortgage amount by the bank and seller says they are covering the rest then it stands to reason they have it otherwise deal won't close.

Its only logical....

Dr_Kolossus

I bid on a house. House valued at 415k. EA asked for proff of funds. I had mortgage approval for 300k. The address of the house and price(was 395k before some bidding) was listed on the approval.

This meant that my bank was happy I had at least 95 k to cover the difference. In fact I had a bit more and explained this to the EA. I didn't tell them how much and they didn't ask, but they were at least happy I was serious about the house, and was in the ballpark of what I offered.

I don't think there's any problem with this.

Only problem would be if I was bidding on a much lower value house e.g. 150k.

Moomintroll99

Yeah I could be wrong but I don't think we have this back in Australia. I think it is just that if you can't complete the sale you lost your deposit. I have bought & sold a few times there and don't recall being asked to show proof of funds until actually paying deposit & settlement.

Askthe EA

listermint wrote: »

Bid weird tbh why would a bidder bid on a house they can't pay for...

I can understand of they haven't got mortgage approval and are pre bidding. But if you have been given the mortgage amount by the bank and seller says they are covering the rest then it stands to reason they have it otherwise deal won't close.

Its only logical....

I presume you mean bidder not seller. You assume they have it, but an EA won't assume. They want to know. The other way of looking at this is if someone is bidding and can't cover their bid then they have pushed up the price when they shouldn't have. I know it sounds unlikely but I can assure you, I have seen sales fall as purchasers assume that they will have funds by the time the sale closes, something comes up and hey presto they cannot proceed.

Askthe EA

Moomintroll99 wrote: »

Yeah I could be wrong but I don't think we have this back in Australia. I think it is just that if you can't complete the sale you lost your deposit. I have bought & sold a few times there and don't recall being asked to show proof of funds until actually paying deposit & settlement.

Different system in Oz. Deposits are non refundable. They are here. Obviously if that were the case here there would be no need for proof of funding as people wouldn't risk losing 10% of sale price.

On a side note, I still miss Oz everyday! :-/

listermint

Askthe EA wrote: »

I presume you mean bidder not seller. You assume they have it, but an EA won't assume. They want to know. The other way of looking at this is if someone is bidding and can't cover their bid then they have pushed up the price when they shouldn't have. I know it sounds unlikely but I can assure you, I have seen sales fall as purchasers assume that they will have funds by the time the sale closes, something comes up and hey presto they cannot proceed.

From experience that's not true.

EA accept the mortgage approval and then the additional in cash.

There is no logic to what you are saying someone pushing up the price knowing they don't have the cash or can't get it.

Like what point do they stop? 20 40 60...

Askthe EA

listermint wrote: »

From experience that's not true.

EA accept the mortgage approval and then the additional in cash.

There is no logic to what you are saying someone pushing up the price knowing they don't have the cash or can't get it.

Like what point do they stop? 20 40 60...

The thread is chopping between cash offers and mortgage offers. Obviously for a mortgage offer a MAIP letter close to offer price is fine because obviously you must have a minimum of 10% more.

Without a MAIP people often make widly incorrect assumptions as to what they will actually be lent by the bank often due to online calculators which often don't reflect accurately deductions banks impose. If these people are allowed bid then yes, they can drive up the price to a level they cannot stand over.

Cash offers are different. I'll give an actual example leaving out some details. Guy bidding on a property. Cash offer. Proof of funds contained a large portion of shares far in excess of required amount. Happy days. Except, he didn't realise he needed a tax clearance cert to sell the shares. He ASSUMED he could afford the property. He couldn't (at least until the clearance cert was issued).

theteal

Standard practice over here - although I was a smidge uncomfortable with it when first putting in a bid

pummice

Could you say to EA I will show you proof of funds if the vendor agrees to go sale agreed?

heroics

I wasn't asked to provide proof when bidding on my house. Just told EA had approval and that always accepted

Askthe EA

pummice wrote: »

Could you say to EA I will show you proof of funds if the vendor agrees to go sale agreed?

Depends on the EA and his client.

Askthe EA

theteal wrote: »

Standard practice over here - although I was a smidge uncomfortable with it when first putting in a bid

Where's here out of interest?

listermint

Askthe EA wrote: »

The thread is chopping between cash offers and mortgage offers. Obviously for a mortgage offer a MAIP letter close to offer price is fine because obviously you must have a minimum of 10% more.

Without a MAIP people often make widly incorrect assumptions as to what they will actually be lent by the bank often due to online calculators which often don't reflect accurately deductions banks impose. If these people are allowed bid then yes, they can drive up the price to a level they cannot stand over.

Cash offers are different. I'll give an actual example leaving out some details. Guy bidding on a property. Cash offer. Proof of funds contained a large portion of shares far in excess of required amount. Happy days. Except, he didn't realise he needed a tax clearance cert to sell the shares. He ASSUMED he could afford the property. He couldn't (at least until the clearance cert was issued).

Not chopping and changing you responded to a poster who had 80 percent bank and the rest I his savings plus additional savings he didn't want to show.

I replied to your response on that. No choppy changey just direct response to that.

Logical.

boris1234

To add to peoples experiences above I have placed bids this week on 2 different properties. Neither EA asked for proof of funds. They just accepted our bids.

I find this pretty frustrating as what's stopping anyone ringing up bidding without funds and driving up the price.

Is it normal practice for an EA to ask for proof of funds?

We also bid on a property before Christmas and were not asked for proof of funds.