YOU’VE RECEIVED AN OFFER, GREAT, BUT HAS IT BEEN PROPERLY QUALIFIED?
Todays advice is about making sure all offers you receive on your property are ‘qualified’ correctly which will increase the chances of your sale actually completing.
Unfortunately a certain % of all property sales fall through once they have been agreed (the time between offer acceptance and exchange of contracts), costing property owners a lot of wasted time, money and stress.
There are things you and your estate agent can do to reduce the chances of your sale falling through. My ‘fall through rate’ is only 10%. 9 out 10 sales I agreed actually complete.
One of the reaons sales fall though is because the correct due diligence is not carried out by the estate agent when the sale is agreed.
There are 2 key areas to check:
- The buyers financial position
- The chain beneath them (if applicable)
I will go into more details below
The buyers financial position
Clearly when someone makes an offer, it is important to make sure they can actually afford the price they are offering before entering into negotiations with them. There are various way to do this but mine is to have them speak to my trusted mortgage expert and to see proof of their deposit OR ask to see a copy of their mortgage agreement in principle and proof of their deposit.
Now not all buyers will require a mortgage and sometimes buyers get a little confused. I had a situation recently where I received an offer from a lovely lady and she said she was a ‘cash buyer’. Great. Not really. The cash was coming from the sale of her house which wasn’t even on the market yet. If a buyer really is cash, you will want to make sure your estate agent has seen a copy of their bank statement showing the cash.
The chain below (if applicable)
If the person who has offered on your property has a property to sell, which is under offer, it’s important that your agent ‘checks the chain’. This will involve speaking to every estate agent in the chain below and confirming the current situation and asking the right questions like when was the sale agreed?, Have solicitors confirmed they are instructed?, has the mortgage valuation been carried out and when?, has the mortgage offer been released yet?
A situation I faced recently was that I had received an offer from a guy who told me he was under offer. I spoke to his estate agent and he was under offer, but to someone who wasn’t under offer. So the chain below wasn’t complete. This causes a problem and ideally you don’t want to be negotiating with someone who has an incomplete chain behind them.
The crucial part to all of this is that these checks are carried out BEFORE you/your estate agent start negotiating with the buyer.
The last thing you want to do is agree a price with the buyer, get excited, then the checks are carried out only to find out the buyer isn’t in quite as good a position as they thought or said they were.
All the best,
p.s. Would you like more impartial advice? Head on over to my FREE eGuides page by clicking here.
