Posted on 27 April 2010 by Mrs Cann
An estate agent has advised me to pay part of a property with cash so it does not affect the 10% difference in the sale price and the valuation (that counts as our deposit). Is this legal?
I'm not sure I understand what or why the Estate Agent is asking you to pay for and whether they want it paid in cash or would accept a cheque or bank transfer?
If the actual sale price is 10% less than the valuation why have you got to pay this 10% anyway? I'd have thought a down valuation would give you room to negotiate a lower purchase price. If not then you would still be paying the original price and any increase in the size of the deposit would be paid to your Solicitor.
If it is to avoid some stamp duty you would have to lie about the price on the stamp duty form and that has potentially large penalties. Unless, the Estate Agent is suggesting you buy certain fixtures or fittings direct from the vendor for cash and reduce the purchase price of the property by a similar amount to get below the price threshold for Stamp Duty?
Whatever the reason, you should not pay anything to the Estate Agent without first speaking to your Solicitor and taking their legal advice. I recommend you do this without delay.
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