Cherrypop

I'm sure this has been done to death but everything I read is slightly different. Can anyone tell me, in a nutshell, what's what when buying?

2 agents this week have given me slightly different information.

The first, a British guy said:
10k reservation fee, refundable if I don't proceed, less an admin charge of around 900 euros
30% deposit for promissory

The second, a Portuguese agent said:
5k reservation fee - no mention of an admin charge if it doesn't progress
10-15% deposit for promissory

Also, can most of the process take place via power of attorney? With the collapse of Monarch last week, flight prices have rocketed and I'd prefer to visit once more to get the process started and not have to back and forth.

Any other things to be aware of? Advice please.

Mike

I didn't pay a reservation fee.
The deposit when signing the Promissory contract is usually 10% which you normally forfeit if you don't proceed.
You don't pay any fee to the agent. That's for the vendor.
Use an independent lawyer, not recommended by the agent. The lawyer should be able to do everything with a POA.

EMR

The reservation fee is a sign of definite interest and usally means the property is taken off the market.
In many cases buyers withdraw because they cannot get credit or exchange rates move the wrong way or they simply just change their minds so a reservation fee is not unreasnable. 10k is.

Personally I think the English guy is asking for far too much.
The 900euros is probably the estate agents fee should you not go agead.

As others have said , do not use a solicitor connected to the agent.

Mike

A decent agent should know when they have a "tyre kicker". A serious buyer will be able to answer all the right questions. They get paid a huge amount for doing their job. They shouldn't need a reservation fee.

Cherrypop

Thanks folks.

So - I understood the reservation fee took the property off the market whilst the lawyer does the initial searches (whatever those are) and once I'm happy to proceed, then I go to promissory with the deposit.

Supposing I have an offer accepted, what's to stop the vendor taking a higher offer before I pay my deposit, assuming I've employed a lawyer to do the initial stuff before promissory?

What's the usual regarding completion time scales? The place I'm considering has a vendor that needs to buy somewhere else. The agent asked that completion be several months down the line. Whilst I'm prepared to wait 3 months, I was under the impression it usually happens much sooner than that.

Mike

You can skip Promissory and go straight to completion if you want!
Timescales vary upon each parties requirements, not set.

EMR

We met a " seller " like yours last week, property on the market but needs to buy before completing.
I would keep looking and not part with any money until completion.

Cherrypop

I can appreciate that someone needs to have a place to live before moving out but I did tell the agent that if I made an offer I'd insist on completion by the end of Jan. It suits me not to have to move before Christmas.....do you think this indicates the vendor is a bit wishy-washy about selling?

EMR

If the vendor does not agree to your condition ,then yes.
If they do not move out what happens next ,you get your deposit back and have to start again.
If you are going to make a conditional offer do it in writing and demand acceptance also in writing.

Cherrypop

My understanding is that if the vendor backs out after promissory, I get my deposit back plus they have to pay me the equivalent sum in addition. The agent is talking about promissory within 2-3 weeks of an offer being accepted so I'd imagine if the vendor proceeds on the basis of a finite date for completion, she stands to be out of pocket by 20k if she changes her mind.

If we get as far as entering into an agreement, I'll certainly get it in writing and will be going back out to make sure it's all above board before parting with my deposit.

EMR

If the buyer has not found a house by January they are not backing out of the sale so the increased deposit question does not apply.
However if you walk away and the seller maintains that he is still prepared to sell you the house then it could be you out of pocket.

TravelBugs

It is a minimum 10%. If you have concerns about being gazumped, you should pay more. We paid 40% and was glad we did as the vendor asked if we would take 10000 Euros to back out, as they had someone prepared to pay more. Too bad! Our 40% saved us.

Troia

Be aware of vendors that stay in the house after the deed is completed.

Many horror stories where the legitimate new buyer could not take them out of the house for a couple of years.

liveaboard

I once sold a property and balked at the 10%, as I had to clear some legal hurdles to complete the sale; and as the buyers were friends, I would have trouble charging them that amount if they were to back out.
So I asked the lawyers and buyers if we could do it at 1%, and we did.

The sale did go through, without a hitch.

For our purchase here in Portugal, we paid no reservation fee or funny payments to agents; the agent was working for the seller, and they paid him.
We did pay the 10% at signing the promissory contract, and we had our lawyer complete the sale for us because we were busy packing up to move.

I regretted that; even though everything went perfectly, I think it was stupid of me to trust a stranger with our life savings when all I had to do was get on a plane for a few hours to do it myself.

Pilou

Often I see houses marked as sold or reserved and 2 months or so later they are back again as available on the website. I spoke to 2 different real estate agents and they told us that regularly the mortgage is refused.