Following the recent BBC Panorama programme investigating the conduct of some estate agents, I feel compelled to share a perspective that may be seen as controversial but is crucial to discuss. While it may ruffle a few feathers, my aim is to spark a healthy, respectful dialogue and empower consumers to make informed choices. There are many fantastic estate agents out there, but as in any industry, a few bad practices can tarnish the wider profession.
This article specifically focuses on the practice of conditional selling, the notion that property buyers must use an estate agent’s in-house or affiliated mortgage adviser, solicitor, or insurance provider in order for their offer to be considered seriously.
What Is Conditional Selling?
Conditional selling refers to a scenario where buyers are led to believe, whether subtly or overtly, that their offer on a property will only be considered if they use specific services tied to the estate agent. These services typically include in-house mortgage advice, conveyancing, or insurance.
The Consumer Protection from Unfair Trading Regulations 2008 (CPRs) make it illegal for estate agents to mislead consumers or apply undue pressure. Furthermore, estate agents are legally required to clearly disclose referral fees when recommending associated services. These must be presented in a way that is unambiguous, transparent, and upfront. In practice, however, these disclosures can often be buried in the small print or omitted entirely.
For more information on legal obligations, see guidance from:
- The National Trading Standards Estate and Letting Agency Team (NTSELAT): Referral Fees Guidance
- The Property Ombudsman (TPO): Code of Practice for Residential Estate Agents
The Role of the Mortgage Broker: Who Are They Working For?
In theory, a mortgage broker should work exclusively in the best interests of the buyer. However, commercial arrangements between brokers and estate agents can introduce conflicts of interest, particularly when up to 50–60% of broker earnings are handed back to the estate agent as a referral fee.
This financial arrangement can skew priorities, potentially compromising the quality of advice given to the buyer. Under the Financial Conduct Authority’s (FCA) Consumer Duty, introduced to ensure firms deliver good outcomes for retail customers, firms must act in good faith and avoid causing foreseeable harm. You can read more on the FCA’s Consumer Duty here:
🔗 FCA Consumer Duty
Key Point: Buyers are not obligated to use the mortgage adviser, solicitor, or insurer recommended by the estate agent. You have the right to choose your own independent advisers.
Our Position
At Signature Mortgages & Protection and Signature Specialist Finance, we’ve made the conscious decision not to enter into high-cost referral arrangements with estate agents. Why? Because we believe that trust should be earned through service and results—not bought through backhand commissions. We support estate agents who operate ethically and professionally, and we have declined partnerships where we felt customer interests were secondary to financial incentives.
We’ve unfortunately witnessed many instances, particularly in the new-build sector, where buyers were told, either directly or by implication, that they must use the in-house broker or solicitor to proceed with their offer. This isn’t just poor practice, it can financially disadvantage both buyers and sellers.
A Real-Life Example: When Conditional Selling Costs the Seller
Let me share one of my own experiences, which sadly reflects the very problem highlighted above.
A property was listed for offers in the region of £100,000 by a well-known online agent. As a cash buyer, I offered £90,000, ready to complete quickly. I was immediately asked if I needed a mortgage, legal services, life cover, or insurance. I declined all, making it clear I was a cash buyer. Despite chasing over several days, I received no response.
I raised my offer to £100,000, expecting a swift resolution. Instead, after weeks of follow-up calls and emails, I was told they “couldn’t get hold of the vendor.” The property was eventually marked as sold subject to contract (SSTC), but I later discovered it had sold for £95,000, £5,000 less than my cash offer.
The successful buyer? A first-time buyer who used the agent’s in-house mortgage and legal services.
While I’m happy for any first-time buyer getting on the ladder, it’s worth noting that the vendor, an elderly person selling to fund care and her onward residence, lost out on £5,000, a sum that could have made a real difference. Who benefited? Not the seller, possibly not the buyer, but the agent, who secured a package of commissions from their in-house services.
What Can You Do as a Consumer?
If you feel pressured to use certain services or feel your offer was treated unfairly, you have options:
- Raise the issue directly with the estate agent through their internal complaints process.
- Contact the Property Ombudsman or the Property Redress Scheme if your concerns remain unresolved:
- Report misleading practices to Trading Standards or NTSELAT.
- If your mortgage advice experience was impacted, report to the Financial Ombudsman Service.
Additionally, if the agent is a member of a professional body like Propertymark, you may be able to escalate the matter there: Propertymark Consumer Advice
Championing Transparency and Fairness
This isn’t a battle between independent brokers and in-house advisers. Nor is it a blanket criticism of estate agents, many of whom are hardworking professionals delivering excellent service.
This is a call to prioritise the consumer, uphold fairness and transparency, and ensure regulation applies equally to all parties in a property transaction. If the Financial Conduct Authority can impose such robust standards on brokers and lenders, surely it’s time that estate agents are also held to the same level of accountability.
Final Thoughts
Let’s keep this conversation going. Share your experiences, good or bad, so we can bring about greater awareness and improve standards across the board. If you’re a buyer or seller, remember:
- You have the right to choose your own mortgage broker, solicitor, and insurance provider.
- You deserve clear information about any referral fees.
- You should be treated with fairness, dignity, and professionalism, every time.
At Signature Mortgages & Protection, we’re committed to doing what’s right, not what’s most profitable. That’s how we’ve built our reputation, and we’ll continue to stand for transparency, choice, and ethical service.
If you’ve been affected by conditional selling or want to share your views, we’d love to hear from you. Let’s improve the industry, together.
Dean Birks
Managing Director
Signature Mortgages & Protection www.signaturefs.com
Signature Specialist Finance www.signaturesf.com
01782 617600
