Has the offer on your property been properly qualified?

Has the offer on your property been properly qualified?

Congratulations – you've got an offer on your property! But before you get carried away celebrating and making plans for your future, are you sure the offer has been properly qualified?

They're the words every house seller wants to hear – that an offer on your property has been made. Sadly, not all offers are equal though and, unless your estate agent has carried out their due diligence, there's still a chance that the offer could fall through.    

According to an article published on the website This Is Money, over 300,000 property transactions fall through each year. What's more, thousands of pounds – typically an eye-watering £2,727 - are wasted each time a transaction fails. With moving house already a costly procedure, this is money most people could do without losing.

Two of the common reasons cited for property sales falling through are due to a sale elsewhere in the chain falling through or the buyers finances failing to be in order.

The good news is that your estate agent can play a positive role in reducing the risk of an offer falling through if they property qualify the offer from the outset.

The importance of qualifying the property chain

Property chains can be lengthy and complicated, but are often hard to avoid completely. If the person who has put the offer in on your property also has a property to sell, then they'll be a chain involved.

In order to properly qualify the offer on your property, it's essential that your estate agent investigates and checks out the state of the property chain. They'll need to phone and speak to each and every one of the estate agents in the chain and find out the exact situation of each buyer in the chain.

For example, they'll typically ask questions such as whether an offer of sale has been agreed, if a mortgage valuation has been carried out, if the solicitors have been confirmed and whether or not the mortgage offer has been released.

It's important that your estate agent carries out the property chain check as soon as possible. Ideally, it's done before they start negotiating on your behalf with the buyer, as there's nothing worse than you accepting an offer, only to be let down afterwards when a problem with the chain is discovered.

Qualifying the buyers financial position

Just as it's important for your estate agent to carry out due diligence and check the state of the property chain, so too is it crucial that they qualify the financial position of your potential buyer.

If someone has made an offer on your property, it's only natural for you to want to be sure that it's genuine and that they really do have the finances available to fund the purchase.

A professional estate agent will want to ensure the buyer really can pay the price before starting negotiations. One of the key ways that someone's financial position can be qualified is by checking that they have proof of their mortgage agreement in principle and proof of their deposit.

For example, documentation should be available from buyers requiring a mortgage to confirm that a mortgage has been agreed in principle. In the case of cash buyers, your estate agent will request a copy of their bank statement to ensure they really do have the cash available to purchase the property.

Your estate agent is just as keen as you are to secure a definite sale on your property, so all these aspects should be taken care of as a matter of urgency.

Of course, there are still other reasons why property sales fall through, such as buyers changing their mind or property surveys bringing up issues further down the line, and there's little you can do about some of these. However, if your estate agent has properly investigated the chain and financial aspects, your mind can at least be put at rest that at this stage the offer is substantiated and properly qualified.