Valuation costs

I’m selling my house in spain and I’ve got three buyers who have all made offers and are all arranging valuations so they can get mortgages. They have all offered different amounts. I can only sell the house to one buyer but I’m worried that I will end up having to pay the costs for valuations of the other two buyers if I don’t sell to them (about 400 euro per valuation). 

Am I legally forced to pay for valuations if I don’t sell to someone? I haven’t signed any contracts or anything? Any help would be appreciated

I am not sure who is advising you or if all of the offers are via agents because basically you HAVE NOT sold your property and you are in danger of losing all of the potential buyers

The way that the process should work is that an offer is made, accepted subject to mortgage, a deposit paid by the buyer, which can be refunded if the mortgage isn't granted and then the sale

In your situation you are not being fair to the buyers having 3 all going through the process, do they actually know that they are with 3 other buyers, , you need to get an offer made and accepted.

What happens if the valuation comes back well under the price that they have offered, no commitment and they can walk away, THERE IS NO COMMITMENT TO BUY

What is the difference in price between the offers, do you know the personal circumstances of any buyer, is one in a better position to buy, the valuation process for a mortgage in Spain can be lengthy

Are you legally liable to pay the valuation fees no, should be morally allow 3 buyers to go through the process and expense, no

Remember if you accept a contract and then pull out in Spain normally the seller has to return twice the amout of the deposit paid

Inspectahome 

Good post but it is not mandatory for a buyer to pay a deposit but optional 

Yes no deposit means the property will remain on the market

That is a risk worth taking as so many people are told they have to pay a deposit then lose it in the mess that is conveyancing in spain

Thanks all. Very much appreciate the guidance. 

Steve ........  it is not mandatory for a buyer to pay a deposit but optional

Long story, but briefly, for a good reason I tried that route once.

The lawyer representing the buyer (I did not have one) would not go along with my suggestion as of course I could have changed my mind at any time, or accepted a higher offer, etc.,  leaving his client out of pocket and inconvenienced. His advice to his client was to look for another property where the owner would take a deposit.

johnzx

I tried that route once

But of course you did!!!!!

Still an option whether one pays a deposit or not it is not mandatory but many seem to thin it is, which is my point

Buyer walk away simple really

Steve    Buyer walk away simple really

I agreed with you,  it is optional, had I not agreed I would not have said I had tried to sell wthout taking a deposit.

Simple 'Buyer walk away'   but do you think that is advice anyone would take, especially with the market the way is  ?

johnzx

yes you agreed (and of course I am not suprised you have done it before)

but do you thonk that is advice anyone would take....

why not there are so many properties for sale on the costas it is still a buyers market

If the seller wants to insist on a deposit and risk losing a sale then their choice

Why should a buyer gamble

as I said so many stories of people losing their deposits and it is a bad practice promoted by estate agents, solicitors, sellers and comments on forums saying deposits ar mandatory, tehe norm or putting fear into them that they the house may be sold to someone else unless they stump up a £3000 deposit.

Steve why not there are so many properties for sale on the costas it is still a buyers market

Exactly, it was a seller, not a buyer, who posted the question, why would any seller want to chase off a buyer ?

You need to give a tadd more time reading the question before jumping on with an 'answer.'

johnzx

Seller shoudl not even ask for a deposit and I think they are been driven by others.

Where did €3K come from, which seesm to be the figure used by many. 

If the seller and buyer want some form of commitiment why not a simple small amount say €200 as an admin resrevation fee

the original question was about valuation fees 

It was inspectahome who raised the subject of deposits and hence my comment, so maybe you should be reading the thread a bit more closely

BTW is "a tadd" a new buzz word/ phrase for you as you seem to be using it a lot

As I have explained on here before I am an estate agent, I sell properties every week and dweal with the practicalties of the sales process

Certainly around the Costa Blanca area, places like Villamartin, Cabo Roig etc, for properties between 100k - 200k it is a sellers market, we are screaming out for properties walkinh distance to the beach or La Zenia areas

A property isn't sold till the buyer has paid a deposit, typically between 3k - 5k, which takes the property off the market, securing it initally for the buyer and the seller and starting the sales process, but this isn't mandatory

This money is normally paid to and sits with the lawyer, it allows the lawyer to first check the legality and any charges on the proiperty and create the sales contract and does not pass to the seller till agreed by the buyers but if there is no commitment, by both parties there is no sale

In case where there is a mortgage required this is made as a condition of the contract, the deposit remains fully refundable and normally the first mortgage offer should only take a couple of weeks to obtain

The deposit is not refundable only AFTER the sales contract is signed, if the buyer then pulls out they loose their deposit, if the seller pulls out they have to repay DOUBLE the deposit paid

The situation with simonline was simple, he is looking to string along 3 buyers who all will incur expenses and have offered different amounts withou making ANY commitment, why should the seller risk loosing the sale, surely if somebody wants to buy the property whats wrong with paying a deposit, no deposit no sale

inspectahome

The problem is the amount of deposit, the lies that people are told that it is mandatory and the many stories of people losing their deposit. No COOLING of option is another issue when monies are handed over under pressure 

Why can't estate agents and solicitors etc be more honest and say it is AN OPTIONAL deposit

What is worng with a small reservation fee wich is common in the UK for new builds.

When buying a house in the UK no deposit is required by either party - yes this is Spain and different as are many other countries but it is clearly open to corruption and lies

If the seller decides to string 3 poepe on then their choice and what a nice position to be in - first come with the money first served but hope he does not mess it up too much and lose all 3

Mayeb he should be honest with all 3 potential buyers and let them know with a deadline to get to contrac exchange or even invite the 3 bidders to share the valuation cost

It is not optional, if you want to buy a property then what is unreasonable in asking for a deposit to take the property off the market of between 3k - 5k

What we are not doing is asking for the buyer to sign the sales contract, that takes the time, if you want to call if the cooling off period

This protects fhe buyer and the sellers 

You can go back and decide, send the depost afterwards it the buyers choice but so many times I have seen buyers loose the property

Hi all,

just to be clear, I’m stringing nobody along, all potential buyers are aware of each other, all are choosing to wait till they have valuations before making a formal offer and signing a contract. My only concern was that if all three valuations happen before I get an offer, am I then legally obliged to refund the two that can’t offer as I have accepted another offer, to which answer seems to be no. 

Whilst it took some reading between the lines and amidst the sly personal attacks on each other, I am grateful to have an answer to my question. 

Just out of interest Simon.

How did you choose to market your property please?

Inspectahome 

Of course it is optional unless you are now saying it is mandatory. 

The risk for the buyer is that the seller keeps the property on the market and another buyer comes in. The risk for the seller is the buyer might walk away but nobody loses money

It is unreasonable to demand or even ask for a deposit of that size a small reservation fee of say €200 would be reasonable 

As we have all heard getting this deposit back can take years and even then it is not given back due to unscrupulous  builders banks solicitors and yes estate agents

It offers no protection to either buyer or seller and the no deposit scenario works quite well in the UK as an example 

Simon I hate to tell you this but you have not sold your property and I am goint to make a prediction

A property is worth what somebody is willing to pay for it, not what the bank will value the property at for mortgage purposes and a bank will typically loan an agreed percentage on either their valuation or the AGREED sales price, whatever is the LOWER

Prediction, the banks will value lower than your asking price and because you have not formally agrreed  the price with the buyers, they will offer based on the valuation

Because of the way that mortgages work in Spain, 60% - 70% LTV for non-residents and the 15% buyers fees are not funded they buyers maximum loan % will be between 45% - 55% of the bank valuation, often big shock for new mortgage applcants

Remember banks are looking to minimise risk, perhaps you should have first had confirmed offers, yes you are not liable forthe valuation fees but yiu are very exposed

The deposit system is designed to protect the buyer and the sellers

The buyers because once paid and signed sales contract, if the seller pulls out they owe twice the deposit to the buyer

The seller because he has a financial commitment so that the buyer cannot just walk away

If a buyer feels under pressure they can walk away, if a buyer won't commit to a deposit the seller can walk away, they are both adults with their own minds

As I tried to explain if the system is operated correctly the money is held by a lawyer in a client account until a CONTRACT is signed by both parties then if either pulls out they loose the deposit

If a property is off plan then it should have an independant bank guarntee to protect all payments, that what happens now,

I recently put my villa on the market with 2 big well known Spain agents. They both just asked how much do you want over the phone. I said 350,000 euru would be nice and they both said OK email us some photos and the old description from 10 years ago. One has it listed at 395,000 euro the other at 369,000 euro. They have never been near the property, never a mention of any certificates.

Is that how it’s done Roy? 45,000 euro commission, that’s  £40,000 without even putting the newspaper down. This sounds a good business to be in, do you need to be qualified and is it regulated?.

If I get a buyer and it falls through does the agent get to keep the deposit, I only ask because they say any deposit must be paid to them?.

Jack did they sell the villa

No if the sale falls through the agent does not get to keep the deposit, once the sales contract is signed it is paid to the seller

If this happened to me then I would not be happy to have 2 agents marketing my property at different prices because I would actually want to sell if and I wouldn't be stuoid enough to have my property marketed in tis way, especially if I knew