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Agent wants 10% deposit into trust account before accepting remote auction bidding

Discussion in 'The Buying & Selling Process' started by HappyCamper, 29th Sep, 2015.

  1. HappyCamper

    HappyCamper Active Member

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    So I've bought a couple of times at auction without physically being there. Agents were happy for me to send a bank cheque / EFT on the next business day. Smooth as.

    Anyway, I'm wanting to bid remotely at the auction of a house I've seen. Established Melbourne franchise, etc etc. I've spent some money flying in to inspect, do building/pest, etc. The answer I get is that they want me to deposit 10% into their trust account before they'll let me remotely bid at the auction, to be refunded if I am unsuccessful. Long argument with the principal on the phone and they won't budge.

    Has anyone heard of such a thing? I want the house. It's the first that's tickled my fancy in this area after months of watching. At this stage, I'm thinking I'm just going to have to take a day off and fly down for the auction.
     
  2. Scott No Mates

    Scott No Mates Well-Known Member

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    They don't know you from Adam. What's your 10% vs theirs?

    Will they accept a taken 1%?
     
  3. HappyCamper

    HappyCamper Active Member

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    I would argue that they don't know any of the bidders either.

    Not sure I understand your question about my 10% vs theirs?
     
  4. Simon L

    Simon L Investment Property Buyers Agent Business Member

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    If its a bank sale, sometimes they require phone bidders to have the deposit in the agents trust account before allowing you to bid. Have done this many times and always refunded when unsuccessful.
     
  5. HappyCamper

    HappyCamper Active Member

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    This one isn't a bank sale. The agent just indicated it was company policy.

    I dunno, it just rang alarm bells for me.

    I'm sure the agent would tell me to piss off too if I were to ask for a $50k deposit for a 3 month exclusive listing.
     
  6. Greyghost

    Greyghost Well-Known Member

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    Well if you want to bid I guess you are going to have to cough it up..
     
  7. TMNT

    TMNT Well-Known Member

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    ive done it before too, and yeah they dont budge,

    sometimes its an agency poilicy someimtes its a bank policy,

    I usually just express post a personal cheque, and tell them to rip it up if im not successful
     
  8. KateAshmor

    KateAshmor Victorian Conveyancing Lawyer Business Member

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    Not recommended. It would be reasonable to pay $1,000 beforehand, which is to be returned to you if you are unsuccessful. A gesture of good will and good faith. Far less likely that either party will do something dodgy.
     
    Esh and HappyCamper like this.
  9. S.T

    S.T Well-Known Member

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  10. Biz

    Biz Well-Known Member

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    Tell them to stick their auction up their bum.
     
  11. ej89

    ej89 Well-Known Member

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    Just send them a 5k cheque and get everything in writing so you can definitely get it back..
     
  12. HappyCamper

    HappyCamper Active Member

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    Thanks for the replies everyone. I wanted this one, so ended up flying down for the auction. Sure as hell wasn't going to be depositing $50k in their account. They wouldn't budge on anything less. Anyway, it turned out they had a heap of interest and the house went for over the odds. Seems like this is the way it works in Melbourne, although another agent for another house seemed ok with a token $1k. Bought in Sydney and Adelaide without the need for a pre-auction deposit.