Is it normal for auctioneer to ask for mortgage approval documents?

sweet_trip

I presume it is but asking anyway.
Looking at buying a house. Was a highest bidder for some time then the auctioneer told me a "property investor" was interested.
Haven't gotten to the deposit stage yet. Still bidding on going after a viewing.


Then the auctioneer asked me for my mortgage approval documents which I handed over without question.



Now the auctioneer has a fairly good idea of what my maximum is. I'm getting weird vibes as the auctioneer is talking like I won't stand a chance against this other bidder and that he knows them well.



I mean, I most likely don't have a chance as they're now outbidding me by large amounts and I'm almost at my limit.



Just curious as to if this is normal practice is all.

TheSheriff

sweet_trip wrote: »

I presume it is but asking anyway.
Looking at buying a house. Was a highest bidder for some time then the auctioneer told me a "property investor" was interested.
Haven't gotten to the deposit stage yet. Still bidding on going after a viewing.


Then the auctioneer asked me for my mortgage approval documents which I handed over without question.



Now the auctioneer has a fairly good idea of what my maximum is. I'm getting weird vibes as the auctioneer is talking like I won't stand a chance against this other bidder and that he knows them well.



I mean, I most likely don't have a chance as they're now outbidding me by large amounts and I'm almost at my limit.



Just curious as to if this is normal practice is all.

This was a massive annoyance of ours.

We never handed over docs which showed the amount we were approved for: when pressed by one auctioneer we said we could have our solicitor confirm we have funds available to meet the bid.

We did give redacted documents.

For the life of me I can't understand why you I as a buyer would tell an EA, who works for the seller, how much money I have to play with.

KilOit

sweet_trip wrote: »

I presume it is but asking anyway.
Looking at buying a house. Was a highest bidder for some time then the auctioneer told me a "property investor" was interested.
Haven't gotten to the deposit stage yet. Still bidding on going after a viewing.


Then the auctioneer asked me for my mortgage approval documents which I handed over without question.



Now the auctioneer has a fairly good idea of what my maximum is. I'm getting weird vibes as the auctioneer is talking like I won't stand a chance against this other bidder and that he knows them well.




I mean, I most likely don't have a chance as they're now outbidding me by large amounts and I'm almost at my limit.



Just curious as to if this is normal practice is all.

He played you so you won't question the large increases, you just revealed your cards. I'd walk away from it if it was me

L1011

Its normal to ask; its also normal to tell them to get lost as it is always a tactic to see how much you can spend.

I would pull out of this sale and avoid all other properties that EA has.

sweet_trip

Thanks all. Stupid move by me I guess but I'm first time buyer so trying to navigate all the chancers and tricks of the trade.


Finding it a bit frustrating as I don't have a huge amount to play with.

snowcat

TheSheriff wrote: »

This was a massive annoyance of ours.

We never handed over docs which showed the amount we were approved for: when pressed by one auctioneer we said we could have our solicitor confirm we have funds available to meet the bid.

We did give redacted documents.

For the life of me I can't understand why you I as a buyer would tell an EA, who works for the seller, how much money I have to play with.

An EA works for himself. He does not give a damn what a house sells for as long as it sells and he gets his commission. If he could accept the first bid he probably would. When you are on 1.5% there is no incentive to get a max price. 1.5% of 400k and 450k is not worth any extra effort. I personally dont understand why sellers dont sell a property themselves. It is not difficult to do. A 50k difference is huge to a seller but trivial to an auctioneer.

TheSheriff

snowcat wrote: »

An EA works for himself. He does not give a damn what a house sells for as long as it sells and he gets his commission. If he could accept the first bid he probably would. When you are on 1.5% there is no incentive to get a max price. 1.5% of 400k and 450k is not worth any extra effort. I personally dont understand why sellers dont sell a property themselves. It is not difficult to do. A 50k difference is huge to a seller but trivial to an auctioneer.

This is incorrect.

An EA is incentivised to achieve the highest price for a property in order to attract further potential sellers/ achieve other higher prices in the vicinity.

To say otherwise, and that is doesn't matter to an EA what a house sells for is frankly misleading.

L1011

snowcat wrote: »

An EA works for himself. He does not give a damn what a house sells for as long as it sells and he gets his commission. If he could accept the first bid he probably would. When you are on 1.5% there is no incentive to get a max price. 1.5% of 400k and 450k is not worth any extra effort. I personally dont understand why sellers dont sell a property themselves. It is not difficult to do. A 50k difference is huge to a seller but trivial to an auctioneer.

An EAs next job is dependent on being able to sell themselves to the vendor; and the main element of that is how high they have managed to flog the place for.

snowcat

TheSheriff wrote: »

This is incorrect.

An EA is incentivised to achieve the highest price for a property in order to attract further potential sellers/ achieve other higher prices in the vicinity.

To say otherwise, and that is doesn't matter to an EA what a house sells for is frankly misleading.

That is a load of bull. An EA has no control over the higgest/lowest price got for a property. The market decides that. The EA wants the property sold as quickly as possible so as they can bank their commision. They dont care if it sells 50k above or below asking as long as it sells. The EA does not add value to the sale. They do nothing bar take a few pics post it on daft.ie and accept offers. When sold If questioned on sale price they will say that was what the market price of the property was.

TheSheriff

snowcat wrote: »

That is a load of bull. An EA has no control over the higgest/lowest price got for a property. The market decides that. The EA wants the property sold as quickly as possible so as they can bank their commision. They dont care if it sells 50k above or below asking as long as it sells. The EA does not add value to the sale. They do nothing bar take a few pics post it on daft.ie and accept offers. When sold If questioned on sale price they will say that was what the market price of the property was.

Can't tell if your are joking or not, but anyway, believe what you want

To the OP, I would walk away from this sale as you've shown your cards.

Posts here telling you the EA doesn't work for the seller and doesn't want the highest price are absolutely delusional. Laughable even.

snowcat

snowcat wrote: »

That is a load of bull. An EA has no control over the higgest/lowest price got for a property. The market decides that. The EA wants the property sold as quickly as possible so as they can bank their commision. They dont care if it sells 50k above or below asking as long as it sells. The EA does not add value to the sale. They do nothing bar take a few pics post it on daft.ie and accept offers. When sold If questioned on sale price they will say that was what the market price of the property was.

I wouldn't agree with that. I know EAs who I would buy off but never allow to sell my house. And the other way around. There are certain agencies that are very good at getting high prices for the houses they sell.

snowcat

TheSheriff wrote: »

Can't tell if your are joking or not, but anyway, believe what you want

To the OP, I would walk away from this sale as you've shown your cards.

Posts here telling you the EA doesn't work for the seller and doesn't want the highest price are absolutely delusional. Laughable even.

I have bought and sold loads of houses. Im a professional landlord. I never use an agent for sales or rentals. Recently i made a rather large amount of money buying a property off a large well known EA who was acting on behalf of a receiver and did not know or care about the value of the property she was selling. Thankfully i did.

snowcat

Deleted User wrote: »

I wouldn't agree with that. I know EAs who I would buy off but never allow to sell my house. And the other way around. There are certain agencies that are very good at getting high prices for the houses they sell.

And how do they manage that? The Irish market is not "Million Dollar listing" where the agent gets 10% and has an active participation in the sale. The Irish EA's would baulk at the idea of cleaning a property or redecorating it to get a better price. Why would they. They get 1.5%. Their max input is a few photos and maybe a drone shot, put it on daft.ie and accept any offers.

guyfawkes5

I've experienced this before. I offered my AIP letter with the amount redacted and they accepted.

They're probably more interested in that you can actually proceed with a sale (as it's not uncommon for people to bid while still in the mortgage application process) rather than finding out what maximum you go to.

Dav010

snowcat wrote: »

I have bought and sold loads of houses. Im a professional landlord. I never use an agent for sales or rentals. Recently i made a rather large amount of money buying a property off a large well known EA who was acting on behalf of a receiver and did not know or care about the value of the property she was selling. Thankfully i did.

As an experienced property speculator, you should know the difference between a receiver sale and a property being sold by a private owner. Receivers want to cover the amount owed so will often be more interested in a quick sale than maximising the amount the property is worth. A private seller has a more vested interest in the property and will often wait for the right bid to be made. Also, EAs are likely to get more sales from other owners based on the price achieved, whereas a receiver may be sitting in an office somewhere far away and may never have even visited the property. I would suspect receiver sales make up a small proportion of an EAs sales per year relative to owner sales by locals, so track record is more important to locals.

snowcat

Dav010 wrote: »

As an experienced property speculator, you should know the difference between a receiver sale and a property being sold by a private owner. Receivers want to cover the amount owed so will often be more interested in a quick sale than maximising the amount the property is worth. A private seller has a more vested interest in the property and will often wait for the right bid to be made. Also, EAs are likely to get more sales from other owners based on the price achieved, whereas a receiver may be sitting in an office somewhere far away and may never have even visited the property. I would suspect receiver sales make up a small proportion of an EAs sales per year relative to owner sales by locals, so track record is more important to locals.

Ah come on. Are you an EA? A EA should nor discriminate between sellers, You said yourself an EA wants to get max value for a property so he gets kudus with other vendors. So its fine to accept a low offer from a receiver sale to get a sale but not from a private seller? What about the value you have now put on other properties in the area because you and the receiver agreed you wanted a quick sale. What a joke the profession is

Dav010

snowcat wrote: »

Ah come on. Are you an EA? A EA should nor discriminate between sellers, You said yourself an EA wants to get max value for a property so he gets kudus with other vendors. So its fine to accept a low offer from a receiver sale to get a sale but not from a private seller? What about the value you have now put on other properties in the area because you and the receiver agreed you wanted a quick sale. What a joke the profession is

An EA works on instruction from the seller, a private seller wants the max achievable in most cases (unless they need a quick sale) a Receiver on the other hand might instruct an EA to sell at a price which recoups the finance owed by the borrower. This is why Reciever sales often go to auction and sell at below market value. As an experienced buyer, you should know this. I’m not an EA, but I’ve been buyer/developing/selling residential and commercial properties for a long time, so I’ve bought my fair share of both private and Receiver properties.

Just in relation to the op, it isn’t uncommon for EAs/vendors to require proof of funds before a bid is accepted, at present, unfortunately banks have refused drawdown on mortgages for people in receipt of the wage subsidy, so an up-to-date approval letter may be required. It is also the reason why a cash buyer will often trump a financed purchase.

snowcat

Dav010 wrote: »

An EA works on instruction from the seller, a private seller wants the max achievable in most cases (unless they need a quick sale) a Receiver on the other hand might instruct an EA to sell at a price which recoups the finance owed by the borrower. This is why Reciever sales often go to auction and sell at below market value. As an experienced buyer, you should know this.

Ah will you go away you have just admitted you are quite willing to accept an offer below market price for a quick sale. Potentially devaluing ever other house in that estate once it appears on the register. As an experienced buyer i know exacly how EA's work You care about your sale. Not the sale price.

Dav010

snowcat wrote: »

Ah will you go away you have just admitted you are quite willing to accept an offer below market price for a quick sale. Potentially devaluing ever other house in that estate once it appears on the register. As an experienced buyer i know exacly how EA's work You care about your sale. Not the sale price.

Only a vendor can accept a offer, not the EA.

sweet_trip

Dav010 wrote: »

Just in relation to the op, it isn’t uncommon for EAs/vendors to require proof of funds before a bid is accepted, at present, unfortunately banks have refused drawdown on mortgages for people in receipt of the wage subsidy, so an up-to-date approval letter may be required. It is also the reason why a cash buyer will often trump a financed purchase.

Question: Would it be good to up my bid but also offer a large sum of cash in hand ie. 20% of the sale.

Would that ever trump another bidder?

L1011

sweet_trip wrote: »

Question: Would it be good to up my bid but also offer a large sum of cash in hand ie. 20% of the sale.

Would that ever trump another bidder?

There is zero reason why it would. It does not make you a cash buyer.

sweet_trip

L1011 wrote: »

There is zero reason why it would. It does not make you a cash buyer.

I only ask because this is how my parents bought their house many years ago and the seller nearly took the hand off them. But yeah I figured when dealing with an auctioneer there's not much push in this regards.

Dav010

sweet_trip wrote: »

Question: Would it be good to up my bid but also offer a large sum of cash in hand ie. 20% of the sale.

Would that ever trump another bidder?

I don’t see anything to be gained by this. You are still relying on finance to buy the property. There is no sure way of winning a bidding contest for a property without overpaying for it. Often it’s a learning process, you learned this time not to show the amount you have approval for. Just sit tight.

snowcat

Dav010 wrote: »

Only a vendor can accept a offer, not the EA.

So advise us again why people hire an EA? If the vendor sets the price, accepts the price and the market dictates the price. Therefore the EA just places an advertisment and has no control over the sale price in the least. So you basically pay an EA 1.5% to place an ad and do a few viewings.

Dav010

snowcat wrote: »

So advise us again why people hire an EA? If the vendor sets the price, accepts the price and the market dictates the price. Therefore the EA just places an advertisment and has no control over the sale price in the least. So you basically pay an EA 1.5% to place an ad and do a few viewings.

Vendors hire EAs to facilitate the sale by advising on guide price, advertising the property, arranging viewings, dealing with queries from interested buyers, advising on time wasters, informing the seller on bids etc. Not everyone hires an EA, lots now sell direct.

But one thing an EA cannot do is accept a bid, only the vendor can do that. Wouldn’t you know what an EA does if you are as experienced as you claim?

snowcat

Dav010 wrote: »

Vendors hire EAs to facilitate the sale by advising on guide price, advertising the property, arranging viewings, dealing with queries from interested buyers, advising on time wasters, informing the seller on bids etc. Not everyone hires an EA, lots now sell direct.

But one thing an EA cannot do is accept a bid, only the vendor can do that. Wouldn’t you know what an EA does if you are as experienced as you claim?

I do and I am as experienced as I claim. And yes i would never let an EA do all the things you state above especially when i know i am more expert then them. This 'advising on time waters is priceless'. What a load of bull. As if an EA has a catalogue of time wasters. I have bought and sold loads of properties and usually find EA's are the biggest time wasters of them all. Dont return calls, no interest in the property, wont reply out of hours or holidays, will take offers from anyone or anything without any basis..i would much rather deal with the owner of a property than a proxy but unfortunately i usually end up wasting my time with unknowledgeable EA's

Dav010

snowcat wrote: »

I do and I am as experienced as I claim. And yes i would never let an EA do all the things you state above especially when i know i am more expert then them. This 'advising on time waters is priceless'. What a load of bull. As if an EA has a catalogue of time wasters. I have bought and sold loads of properties and usually find EA's are the biggest time wasters of them all. Dont return calls, no interest in the property, wont reply out of hours or holidays, will take offers from anyone or anything without any basis..i would much rather deal with the owner of a property than a proxy but unfortunately i usually end up wasting my time with unknowledgeable EA's

A lot of sellers don’t want/have the time to do viewings/deal with potential buyers themselves. In the ops case, the auctioneer is checking the basis on which the offer is being made by requesting details about mortgage approval.

Hollybeg

snowcat wrote: »

I do and I am as experienced as I claim. And yes i would never let an EA do all the things you state above especially when i know i am more expert then them. This 'advising on time waters is priceless'. What a load of bull. As if an EA has a catalogue of time wasters. I have bought and sold loads of properties and usually find EA's are the biggest time wasters of them all. Dont return calls, no interest in the property, wont reply out of hours or holidays, will take offers from anyone or anything without any basis..i would much rather deal with the owner of a property than a proxy but unfortunately i usually end up wasting my time with unknowledgeable EA's

100%. The biggest cowboys going. If I could avoid dealing with them, I would.

snowcat

Dav010 wrote: »

A lot of sellers don’t want/have the time to do viewings/deal with potential buyers themselves. In the ops case, the auctioneer is checking the basis on which the offer is being made by requesting details about mortgage approval.

I have made hundreds of bids on properties. Never once have i been asked for anything to verify my bid. Not once in 25 years of bidding,

Dav010

snowcat wrote: »

I have made hundreds of bids on properties. Never once have i been asked for anything to verify my bid. Not once in 25 years of bidding,

Times are a changing.

snowcat

Dav010 wrote: »

Times are a changing.

And bring it on but 'times are not a changing'. I would welcome a law that an EA could not accept a bid without an official letter of mortgage approval from a bank or confirmation from a solicitor the funds were there. But but but then everything would be transparent and EA's would have to do a lot of work..and charge more. Then all the spurious unfounded bids would disappear. At the moment a 12 year old can bid 800k on a house and it is accepted as a bid over the phone. Ridiculous