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I had an overseas investor from Kuwait looking for a house in London (they currently rent an apartment while she is doing her MBA) - know the person on a friend level. Now they asked me to find them a house which I did that was £800k but negotiated to £760k with estate agent. Now have gone back to my client and told them have got it down at reduced price to £780k, which they are very happy with. My £20k is my fee.
How do I structure this deal? Have a contract with estate agent where I state they bill them £760k house and £20k my fee that they need to pay me? Or introduce a fee to be retained by my client signed with them before introducing?
I believe you need to have a separate agreement with the buyer for the £20k and get this signed. It should state the £20k should be paid on exchange or completion. You need to ensure this gets to the coveyancer for the buyer and they should transfer it to you.
Or you just have the agreement with the seller separately without getting the conveyancer involved.
If there is a better and safer way to do it, then I would love to know also.
I presume your client knows your fee. In which case it is two separate transactions. If not then I think it is a problem.
Chartered Accountant, Tax Advisor and Mortgage broker
(and BTL portfolio owner)
First of all nice work.
If the sale price has been agreed then the conveyening team now pick this up.
The purchase price is 760 as SDLT will be applied accordingly.
Your fee should be included on the completeion statement and dealt with by the solicitor. This is then compliant with money laundering rules. Well this is how I do it.
Thanks. Yes, decided to structure this with client to keep simplest transaction and avoid issues.
Client did not know there was a fee, but as they did not expect a discount (saving them £20k for my work plus negotiated some furniture included in the deal the liked - my value to the deal) they are happy with £780k. I told them the £780k includes my consulting finder fee of about 5.5% which they agreed to sign a contract with me. So will be two transactions - £760k to agency and £20k to me.
Well done mate, not bad going! I need some Kuwaiti friends
Saudi and UAE also nice friends - they are going to introduce me to
Dont forget to mention myself from Birmingham!
good to have it all in the clear. do they know about additional charges like SDLT, etc?