Estate agency giant Countrywide is investigating claims that one of its estate agency branches has pressured potential purchasers into using its own mortgage advisers.
The investigation comes after mortgage broker White Financial Services claimed that two of its clients were “unduly encouraged” by Countrywide brand Palmer Snell to use its own mortgage adviser, according to Mortgage Strategy.
The Taunton branch of Palmer Snell reportedly told customers they could not view or put offers in on properties without seeing the firm’s tied mortgage adviser, according to White Financial Services managing director Dan White.
White told Mortgage Strategy: “It was lucky they were both quite strong-headed and said no.”
A Countrywide spokesperson said: “Countrywide takes these matters seriously and as such are investigating the incidents as outlined to us in this branch.
“We can say with certainty that we do not impose conditions on any applicant wishing to view or make an offer on a property. We like to ensure that any offer put to vendors has been qualified but do not insist that any customer needs to meet with any of our consultants.
“Our job is to ensure that the process between buyer and seller is a smooth as possible. We pass all offers on to our vendors.”
One branch? What a laugh. We wanted to view a house a few years back, it was on with dixons. They wouldn’t let us view without seeing their mortgage advisor first, despite the fact I was a mortgage advisor myself! Another corporate I used to work for do it as well, the old offer check, can’t put your offer forward until you’ve been in to see our advisor.
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Totally agree, we had a recent incident where the inexperience of their staff shone through and the corporate directive led the neg to refuse to put forward one of our vendors offers to their client until they had been in to see their MA. Totally illegal. Let’s just wait for the office closures and then us multi branch independents will take over the local market again to act professionally for the clients.
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The Connells in my town still demands offers are made in branch for the above reason. I suspect this isn’t isolated to one branch either
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So people arent allowed to buy from out of the area according to that branch then!
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As a conveyancer reading this, I am adding a question in our purchase paperwork to specifically ask all of our clients:
“Did you feel pressured to use the mortgage adviser of the estate agent office you made your offer through?
Results can then be made available – as we hear this tale SO often….and the usual high street chains crop up.
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But agents may refuse to sell to anyone who uses your services……
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So many companies are prone to this, one of our vendors recently called me to ask if one particular high street brand, who I won’t mention, was allowed to suggest that they would have a better chance of getting their offer accepted if they used their mortgage provider and their solicitors because their vendor trusted their services.
Made me laugh, I bet the seller didn’t even know what was being said and it makes you wonder if the agent then goes onto favour offerers that fall for that trap even if their offer isn’t best suited to the seller. Very naughty.
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This type of activity happens every day of the week up and down the country, in conjunction with “preferred selling” (to a buyer using the agents products even when they are not the best applicant) and with one corporate agency even offering financial incentives to use their mortgage products.
The same agent offering financial incentives opted in favour of such a buyer recently where the deposit was coming from 8 family members, 4 of whom lived in Nepal. Needless to say the chain broke down after keeping us waiting for 3 months for a mortgage offer that was never going to arrive.
A chain we are currently involved in grew by three properties because the agent encouraged their vendor to drop the cash buyer they had in place in favour of one who was conveniently using their mortgage services but had a chain of 3 beneath them. This at the same price previously agreed to the cash buyer.
On top of this, you have agents telling buyers that their client (the vendor) had insisted they use the agents “recommend” conveyancer otherwise they can’t buy the property, usually a wholly inept firm located miles away giving the agent a £200 kick back.
This is an industry wide problem and has been the case ever since I started some 18 years ago.
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Connells are the worst for this activity. Distinct lack of experience and driven by a money grabbing corporate machine. No interest in the clients.
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Completely agree! Connells in Exeter are the worst that I have come across.
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In my South Bucks experience this isn’t one branch or one firm, it’s basically every corporate agent. As said above they become money machines where commission fees and other income gets passed up such a large food chain to muppets that have nothing to do with the original sale.
For these corporate agents the mortgage advice referrals and conveyancing referrals literally become a part of the income spreadsheet, not just a little bonus when clients may use them in an unpressured environment (we all make recommendations to clients after all). Thus for the agents working in a corporate, they are incentivised to push vendors and buyers into using those services and actually expect a certain % every month to do so!
Bottom line for me – I truly hope in a few years all Estate Agents on the high street are independents and only one internet based agency survives. That way the customers will get the best choice without any pressure, depending on the service levels they want.
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I have worked for Countrywide and I have to say this never went on in any of the branches I worked in. We asked but we didn’t insist and never held back offers reported to the vendor.
Burchell Edwards have exercised this method though for as long as I can remember even if you were to produce an AIP they would still insist they sit with their consultant. I have known a mortgage consultant sit in with Burchell Edwards and their client just to make a point and make it very awkward for the branch. Needless to say they never asked our clients after that appointment to sit with their consultant.
Strange that !
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I used to work for one of the large UK Corporates and we were always told to get any purchasers in front of our in house tied mortgage advisors. The pressure to cross sell with KPIs on the in house agents is incredible – they are forced to do this from the higher powers. It should be stopped but it’s just another thing that will be ignored.
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This behaviour is rife all over the UK and has been since early 1990’s. Corporates and franchise with large financial services departments are the worst. FS makes mega bucks. When it became a duty to qualify the buyer it opened the flood gate to distort correct procedures and the qualifying was used by the FS department to pressure sell its products for its own gains. Always been a “conflict of interest” when the fees being paid became extortionate by lenders and insurers. It used to be there as a help service for buyers … that disappeared many years ago as the main priority for some business’s. Yes you can argue that in-house mortgage advisers do help in the scheme of things but the way it has changed today …. who’s more important, the client or the sale and fees to be earned?
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A countrywide franchise in my area will not allow viewings without first seeing the mortgage adviser … why? They tell the vendors it is to weed out time wasters!
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I used to work for Your Move, and we were always pushed to get people in for FS services, to the point where we had to sit down in a meeting every morning and go through who we registered, what they wanted, financing and when they were booked with the FA or why we hadn’t booked them in. And saying ‘they are happy with their current IFA and don’t want to see another one’ would never go over too well… And gods forbid you had an offer that wouldn’t even speak to the FA over the phone!
But when I viewed and offered through Dixons (didn’t buy the place thank goodness!) they didn’t push for mortgage services, they new I was an estate agent and I explained I was porting my current mortgage with a top up as I was tied in and they seemed to lose interest!
But there are lots of people I’ve spoken to in the area who think that they are far too pushy and aggressive, which I agree with!
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Some fifteen years ago I worked as a lister for Taylors Countrywide in one of their Bristol offices. The incumbent Director called a meeting of a number of staff who were seen to be underperforming in respect of mortgage leads. As a lister I only dealt with the sellers and that month had listed some 10+ properties that were disposals. Upon stating this at the meeting followed by the ensuing laughter of other present I was effectively soon shown the door!
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As in fired, or just asked to leave the meeting as it wasnt relevant to you?
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Demoted to the point where I could not afford to remain, effectively bullied-out!
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Clearly I am the only one who believes that it is actually due diligence to ensure that a mortgage adviser (someone qualified to talk to a buyer about finance) should indeed finance check every offer before you submit it to the seller!
I would add that’s different from insisting someone use your mortgage services or even have to attend an appointment, but are people on this site seriously suggesting that saying to a buyer “oh you’ve got your mortgage arranged, that’s great” is even remotely acceptable before committing your vendor to costs?
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I would suggest that carrying out due diligence is necessary, its just how some agents carry this out that is unacceptable.
We always ask about their mortgage, naturally of course, but we wouldn’t make a decision that could cost our sellers money to line our own pockets as you would find some agents would.
If they don’t want to speak to your MA, because they have their own or are happy with their current offer etc, I would think it was the norm to then ask for a copy of the AIP and if that didnt cover the offer amount, proof of deposit and/or chain details, sale price etc to ensure affordability.
In 2013 I personally got ignored on 5 attempts to view a house with one agent because I wouldn’t see their MA or get a quote from their solicitors prior to viewing, I ended up sticking a note through the owners door, he wasnt aware I wanted to view up to that point and I made an offer. I got outbid but the seller walked away £18k richer by me persevering. I knew someone who worked in the same company (he has since left) and it turned out the buyer was using their full services, it’s why they didnt want me to view I guess. Lucky for the vendor in this case, but how many others suffer unbeknown.
I don’t know whether I should name and shame the company, but I know they still carry out the same practices. They are dreadful for it.
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It is illegal practice to put condition on a viewer to see a mortgage advisor, it is also illegal practice to refuse to accept an offer unless they speak to your mortgage advisor. However the way they skin the cat is to ask the vendor to agree to not accept time wasters at time of listing or later if they forgot. They then manipulate that instruction to their advantage of qualifying time wasters and that is where the line is or isn’t crossed .. the real motive. The EA Act, Practice Orders and PO Code of Conbduct, makes it perfectly clear that an agent may not hinder or delay an offer being submitted to the seller and any services they are offering must be disclosed before the seller makes a decision to accept or reject and must be confirmed in writing and always in the notification of sale. Ladies and Gentleman this is basic EA! As far as qualifying and refusing to take an offer is concerned, you cannot refuse or reject because a buyer declines to accept your offer of service and that is where all these agents break the law. You must advise your seller of the facts pertaining to suitability of the buyer to the best of your knowledge (that does not mean MUST see your mortgage adviser) and leave them to make an informed decision on what you have been able to tell them. A word of warning, when the vendor asks you should they accept the offer …. you are walking into a frying pan!
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I worked for Countrywide for years and this is common practice within branches.
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An estate agent has a duty to “qualify” a potential buyer’s offer prior to submitting it to the seller. The estate agent should not impose restrictive practices, hinder, misrepresent sellers instructions or to make the buyer use any of his services as a condition to submitting the offer.
Under the Estate Agents (Undesirable Practices)(No.2) Order 1991 an estate agent must forward to his client promptly and in writing accurate details (other than those of a description which the client has indicated in writing he does not wish to receive) of any offer the estate agent has received from a prospective purchaser in respect of an interest in the land.
Under the Property Ombudsman for Estate Agents Code of Practice for Residential Estate Agents
It is a requirement that the estate agent must confirm each offer in writing to the seller, and to the buyer who made it.
By law the estate agent must not discriminate, or threaten to discriminate, against a prospective buyer of the seller’s property because that person declines to accept the estate agents (directly or indirectly) provided services to them.
Discrimination by estate agents includes – but is not limited to – the following:
Failing to tell the seller of an offer to buy the property.
Telling the seller of an offer less quickly than other offers the agent received.
Misrepresenting the nature of the offer or that of rival offers.
Giving details of properties for sale first to those who have indicated they are prepared to let you provide services to them.
Making it a condition that the person wanting to buy the property must use any other service provided by you or anyone else.
Here endeth the lesson that all agents should already know!
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I was actually asked to do this on several occasions by senior management to boost numbers. The corporate numbers game was unbelievable. I decided to take matters a bit further!
We have secretly filmed several agents across the UK. Negotiators, branch managers and the FS advisors all relaying the same message as above. Offers being made where refused unless the advisor was seen. Some say it’s the vendors request and even company policy.
The doors are about to be blown wide open.
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Frank Innes and Ashley Adams in Derby are renowned for this type of practice. I have told clients several times to quote the FCA or TSA to get them to back off. Both agencies owned by corporates. Surely their compliance and area managers should be instilling good practice into the negotiators?
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… or hitting targets!
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Ah – good old Palmer Snell. They tried to put this stunt on me few years ago on a house that I was trying to buy at full asking price. I firstly contacted the seller direct who was horrified at their games and agreed to proceed. I then agreed to meet the advisor who foolishly worked in an open plan office with the rest of them. Then proceeded to go ballistic and told both him and the office manager exactly what I thought of their sharp practices in an extremely loud voice. Suffice to say it was a very short meeting and happily I am still living here.
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This isn’t the first time that this particular Agent has been in the spotlight over this unsavoury and totally illegal practice – so why the chuff do they now blurt out that they are investigating the reports?
This should go straight to the relevant Authorities to investigate.
It’s well overdue that we see them #DO_SOMETHING
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