Quick house sales - what's the catch?

Have you thought of selling your house via a “quick sale” company?

If so you’re in danger of being misled, according to the Office of Fair Trading (OFT).

Quick House Sale Providers

Quick house sale providers offer to buy houses in as little as seven days, but at a discount to the full market value.

The OFT is warning that homeowners may receive much less for their property than it’s worth. In some cases they’ll agree to buy a house, but reduce the price at the very last minute.

OFT worries

Businesses offering quick house sales may provide a useful service if you are keen to sell your home quickly.

However, the OFT have warned that they are often used by consumers in vulnerable situations and they are concerned about the risk of consumers being misled and losing out on large sums of money.

Those identified as particularly at risk include people selling after a relationship breakdown, or the elderly who might need the money to pay for long-term care.

There is also concern that some of these firms are giving false valuations.

BBC Investigation

An investigation carried out last year by the BBC found examples such as:

A homeowner from Lincolnshire wanted to sell his house quickly, and agreed to a sale price of £120,000. Just before the deal was signed, the company involved dropped the price to £80,000.

A lady from Teesside signed a similar deal with another firm. She had agreed a purchase price of £75,000, but the day before she was due to move out, the firm lowered their offer to £40,000.

Both companies insisted the number of complaints amounted to less than 1% of their customers.

Unclear fee structures and last minute price reductions

The OFT said practices which cause concern include unclear fee structures, reducing the price at the last minute, and wrongly claiming to be a cash buyer.

It also warned about companies making false property valuations, and tying customers into contracts preventing them selling to other people, should alternative, and more generous offers emerge.

OFT concerns include:

• unclear fee structures
• reducing the price at the last minute
• making misleading claims about a property's value
• falsely claiming to be a cash buyer
• exclusive contracts, preventing sales to other buyers

The Law Society has called for tougher regulation of the industry.

Have you been offered a 'quick sale' for your property?

Tim Langford, head of the residential property department at Wallace Robinson & Morgan solicitors in Solihull, said, “If you have been offered a “quick sale” of your property you should be very wary.

I would always advise that you get fully independent advice from your solicitor before agreeing to any sale of your home. In many cases, these “quick sale” firms are encouraging the sale and the purchase to be completed on the same day.

This can put the home owner in a very difficult situation if the firm suddenly reduce their valuation of your home at the last minute.”

What do you think? We’d love to hear your experiences.

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