What you need to know about the 7 day cooling off period
If you find yourself pressured to sign with an agent who promises to be able to sell your house fast, it is important to note that they are now obliged to provide potential house sellers with a 7 day cooling off period. If this is not provided, you may be able to withhold payment of the estate agents fee for selling your property.
What is a cooling off period?
Estate Agency contracts usually stipulate heavy penalty fees for contract cancelation. Thus it has been deemed necessary for Estate Agents to provide their clients with a 7 day cooling off period, during which they may cancel their contract penalty free. This applies only if it is signed at a location other than the agents business premises e.g. at the selling property. When signing such a contract house sellers must be given clear written notice, stating their right to cancel the contract within the cooling off period. Note that this applies to agency agreements but not contracts to buy, sell or let. If you need advice about property permission, see this website.
Cooling off Controversy:
Initially instituted to protect house sellers from aggressive unsolicited sales advances, this regulation has become the source of much debate between Consumer Representation Bodies and Estate Agency Organizations.
The “Cancelation of Contracts Made in a Consumer’s Home or Place of Work Etc Regulations 2008” states that clients, who sign contracts away from the relevant business premises, are entitled to the 7 day cooling off period. This is the case whether the sales visit is solicited or unsolicited by the estate agent.
The point of controversy centers on a stipulation stating that this ruling does not apply in the case of “the construction, sale or rental of immovable property” (with certain exceptions). Certain agents believe that this exemption applies to Real Estate sales (‘immovable property’). However, the Office of Fair Trading has strongly advised that Estate Agencies are subject to the cooling off period regulation, and may be heavily fined if they violate it.
The wording of the act is open to discussion, but by and large ethical estate agents have agreed to adhere to this consumer protection policy.
Any contract provided to you by an estate agent has to have a notice detailing your rights to cancel the agreement within 7 days. Any contract that does not include this is automatically unenforceable .
Read your contract:
Before you sign a contract of any sort, it is vital that you read and understand what you are signing. Look out for stipulations pertaining to the type of agency agreement, the length of the agreement, and your rights and procedures for cancelling the contract. If you are unhappy with any of these terms do not sign. You can obtain advice on your rights from a solicitor, or a local Citizens Advice Bureau.
What can you do if you have a problem with your Estate Agent:
All estate agents are bound by the Estate Agents Act 1979 (EAA 79), which requires that they belong to a redress scheme such as The Property Ombudsman (TPO), thus providing house sellers with a port in the storm, if they have a problem with their agent.
When choosing an estate agency to sell a house, it is also best to choose one registered with a relevant trade organization such as; The National Association of Estate Agents (NAEA), The Guild of Professional Estate Agents or The Royal Institution of Chartered Surveyors (RICS). Choosing an agent registered with one of these bodies ensures that you will get a better, and more ethical, level of customer service.