Do I have to use an estate agent’s mortgage advisor?

It may seem like the easiest option to use the mortgage broker and conveyancer offered by the estate agent from whom you are buying your house, but there are downsides. We take a look at why this may not be the best option and set out what to do if you feel pressured into using the estate agent's mortgage advisor or solicitor.

Angela Kerr Director, Editor

After months of searching, you’ve found the house of your dreams and now you want to get things moving. Luckily for you, the estate agent selling the house you want to buy has a number of financial service providers they recommend you use.  Not only do they have a mortgage adviser, but also a conveyancing solicitor to hand.

But do you have to use them? In short, no. You don’t have to use the estate agent mortgage advisor or use other in-house services. And while it may be the most convenient option, it is not necessarily the best option. We recommend you shop around, and explain why below.

We often hear of cases where people make an offer on a house only to be told by the estate agent that they need to use the in-house mortgage advisor before their offer can be put forward. Or the agent alludes to the fact they’ll be disadvantaged in some way by not having a meeting with agent’s broker.

Well, the suggestion your offer can be held back until you have seen the estate agent’s mortgage advisor is simply illegal. Read on for what to do if this happens to you.

Downsides to using the estate agent’s mortgage advisor and solicitor

1. You might not get the best deal

In order for a mortgage broker to find the best possible mortgage for you, they need to be able to access as wide a range of products as possible. Brokers who can do this are known as ‘whole of market’. But not all mortgage brokers are equal. Some can only access mortgages from a limited panel of lenders.  This means you might not get the best deal and end up paying more for your mortgage. So always shop around.

Don’t forget, the wider range of mortgage products your broker can consider for you, the more likely you are to get a cheaper mortgage deal. Also, some mortgage brokers charge fees for their services while others are fee-free.

The same goes for estate agent-recommended conveyancing solicitors. Shop around to ensure the legal firm you choose has the expertise you need (for example experience of dealing with new builds), to check customer reviews and to ensure you get a good price. We would recommend getting at least three quotes and comparing the cost and levels of service they offer.

By all means get a quote for both mortgage and conveyancing services from the estate agent if helpful, but you should then shop around and compare.

 Compare your mortgage offer and compare conveyancing quotes instantly, today.

2. Using in-house services might not work in your favour 

All solicitors must give you independent, impartial advice. But if your estate agent knows the conveyancing solicitor you use, they may be able to get information on what exactly is happening in your sale. If the person buying your house should pull out of the sale, for example, you’ll probably not want to tell the seller of the house you’re buying straight away, in the hope you can find another buyer quickly and keep the sale together. If you’re using the conveyancing solicitors attached to the seller’s agent keeping this information quiet could be tricky!

3. You don’t want to give too much away

No one is suggesting your need to be all cloak and dagger when it comes to your finances. Indeed, it’s important to be upfront and honest about what you can afford and what you’re willing to pay. However, if the estate agent marketing a house – for the seller (let’s remember who their paying client is!) – persuades you to let their in-house adviser vet your finances, the agent will have a clear idea about what you can afford and may encourage the seller to push for a higher offer. Once the agent knows what you’re able to pay (rather than what you’re willing to pay), your negotiating position is completely undermined.

With the introduction of Anti-Money Laundering Regulations, we hear from increasing numbers of home buyers who are being asked to see the estate agent’s mortgage advisor to check they are legitimate. But at the point of viewing houses a Mortgage In Principle should demonstrate you have the funds ready to draw down. You will be asked to give further evidence of source of funds for money laundering checks, but that comes later. And it shouldn’t involve showing your bank statements to the estate agent’s mortgage advisor. Our recent guide on Estate Agents and Proof of Funds explains more.

Will using the estate agent’s mortgage advisor get me preferential treatment?

We’ve heard reports of buyers being put to the front of the queue, or having their offer conveyed in the best light, or getting early viewings, all if they simply use the estate agent’s in-house services.

Particularly brazen agents may imply that you won’t be allowed to view certain properties or that your offer will not be passed on to the seller if you’re not willing to speak with the in-house financial adviser.

And in September 2023, the National Trading Standards Estate and Letting Agency Team (NTSELAT) accused some estate agents of hiding best offers from vendors if they won’t earn extra commission from the buyers and failing to disclose commission fees up front.

Head of the enforcement office, James Munro, said, “We’ve seen commissions of 50% of the price, which is just ridiculous really. In some cases, the consumer’s getting no benefit from them.”

And he issued this warning to homebuyers: “If you’re thinking of buying a property, and you go in and they say, ‘Would you like to speak to our financial adviser or mortgage adviser?’ And you say, ‘No, I’ll sort all that myself. Here’s my offer for the property’.

“Well, that estate agent, and this is more likely in the bigger chains, will lose out on extra referral fees if they put that offer forward to the sellers. There may be another offer which is lower, but that person is using all of the connected services offered by the agent, and mysteriously the higher offer just gets lost on the system. Munro added that: cases were detected by buyers who had offers declined, checked Land Registry data and noticed a lower offer had been accepted.”

All of this discriminatory behaviour is illegal. See below for more details.

How can I avoid having to use the estate agents mortgage advisor?

We’d like to say you could avoid these estate agents. But buyers can’t be choosers in this respect. If you want to buy a property, you’re stuck with dealing with the estate agent the seller has chosen.

So what can you do to avoid pressure selling happening to you? Make yourself an informed home buyer and have everything in place. When you make an offer on a property you usually do so over the phone, but then confirm by email, attaching your mortgage agreement in principle and details of your conveyancing solicitor. These are two important pieces of information estate agents need in order to draw up the Memorandum of Sale. When they see you’re on the ball and they are one step closer to securing the sale (and their fee) you’d hope they wouldn’t persist in asking you to meet their in-house service providers.

What can I do if I feel pressured to use the estate agent’s mortgage advisor?

Unfortunately, it’s a common problem. The Financial Conduct Authority was so concerned about the way estate agents have been offering mortgage brokers to consumers that they launched an investigation. In their 2019 Mortgage Market Study Final Report, they highlighted that nearly a quarter of buyers chose an estate agent’s mortgage advisor because it was recommended to them by an estate agent, and of those one in four felt they had to do so.

But you don’t have to. While it will be hard to resist, remember you are under no obligation to speak with an agent’s in-house or partnered mortgage broker or use the conveyancing solicitor they recommend.  You can put the estate agent in contact with your mortgage broker to help them verify your financial situation.

Here are some facts and tips to help you push back: 

1. Know your rights

Make it clear to the estate that you know the law and your rights. And the law is very clear as well. The Estate Agents Act 1979, agents “must not discriminate against potential buyers because they don’t want, or might refuse, to take services from you or a connected person.” This means agents must not “refuse to provide information about a property to these buyers, take longer to send property information to these buyers, compared to others or set additional requirements, as a condition of passing on an offer.”

Many agents are also obliged to follow the The Property Ombudsman guidance that states: “Be aware that you are under no obligation to use any associated services offered by the agent. You are entitled to use your own financial adviser, legal representative (unless you wish to do your own conveyancing), and surveyor if you wish a more detailed examination of the property than the lender requires. Refusal of additional services should not prejudice any offers or viewings through the agent.”

You can tell the agent that if they persist with the pressure or allude to preferential treatment for using their services, then you will report them to the National Trading Standards estate agent enforcement team via Citizen’s Advice. But the reality is that this will put your purchase at risk as it’s extremely likely they will not want to further engage with you.

See our guide for full details on Estate agents’ legal obligations to buyers.

2. Get your mortgage broker involved

Assuming you already have a mortgage in principle in place, ask your mortgage broker to email this to the estate agent and confirm that you are ready to proceed. The mortgage broker should be experienced in these matters and will hopefully make the estate agent’s mortgage advisor back off.

3. Make a formal complaint

Start by making a formal complaint through the estate agents complaints procedure. To do this you’ll need to get together all documents, emails, notes or recordings of the correspondence you’ve had with the agent. Ask for a copy of the company’s internal complaints policy and put your complaint in writing to the branch manager. Give as much detail as possible. State what you’d like to happen now and ask for written confirmation that your complaint is being dealt with. If your complaint surrounds the agent’s in house mortgage broker service copy your complaint to the Financial Conduct Authority. If it’s about conveyancing services send it to the Solicitor’s Regulation Authority (SRA), The Legal Ombudsman or the Council for Licensed Conveyancers (CLC)

Both the SRA and the CLC rigorously state that its members are meant to ensure that their client has chosen them to act without pressure being exerted upon them to do so. If you are being pressured into choosing a solicitor as outlined above refuse firmly and advise that you will seek the advice of the SRA or CLC – this usually does the trick! Find out more about how to complain about an estate agent.

4. Contact the seller

If you think the estate agent is discriminating against you because you’re not using their in-house services it could be worth letting the seller know. Contact them directly by putting your offer in writing through the door of the property for sale and addressing it to the seller private and confidential. Sellers want to feel confident that their agent is marketing their property far and wide, not restricting the number of viewings they get. If they find the agent is not acting in their best interests they’re not likely to be happy.

5. Beware of playing along

You might be thinking, well, I’ll play along if this means I get the house of my dreams. But in doing so, be careful. While there is no limit to how many mortgage agreements in principle you can have, if lenders run a hard credit search on you before issuing you with one you will be left with a mark on your credit file which is visible to other lenders.

In any case, we encourage everyone who has been in this position to make a report to the National Trading Standards Estate and Letting Agency team. Trading standards and the property industry recognise that this is standard practice in some estate agent offices but don’t have the evidence to enforce this law.

Have you experienced pressure from estate agents to use their services? Tell us more in the comments below

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