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 We raised the money for the deposit but didn't get home loan

Their contract is confusing. They refer to a deposit, not a commission 

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Some people think buying a house at an auction is a piece of cake. But there are risks and losses involved.

Prospective buyers are in most cases not able to inspect the house because the occupants refuse to move out. And having obtained an eviction order, they may still not be able to occupy the house because the occupants demand alternative accommodation.

And some buyers lose their money because they do not understand how auctions work.

Shado Mthunzi and her spouse lost R38,338 they paid to an agent, thinking they were paying the deposit for a house.

They blame the agent for not explaining that they were not paying the deposit, but the commission.

Mthunzi saw the house on sale on the internet, advertised by Dynamic Auctioneers on Property24 for R730,000.

She enquired and received a telephone call from Ben Lubbe, an agent. He told her the price had dropped by R120,000 and she asked to view the house.

The couple did not attend the auction and though they were not subjected to the rule operating at auctions, Mthunzi was not told that they would lose their money if they failed to raise the full amount, Mthunzi said.

Lubbe advised them to pay the R38,338 to secure the house .

Mthunzi said Lubbe insisted that they pay the deposit before they could sign the contract.

"We raised the money and deposited it. We later met him at a restaurant to sign the agreement," Mthunzi said.

They could unfortunately not get finance for the full amount, she said.

"Lubbe took his commission under the pretext that it was a deposit and did not disclose that we would forfeit it if we failed to get finance," Mthunzi said.

She said Nedbank asked Lubbe to rectify the contract to show they had paid the deposit, but Lubbe refused.

She said they were only referred to the terms and conditions of the contract when they demanded their money back.

"Their contract is confusing. They refer to a deposit, not a commission," Mthunzi said.

Lubbe told Consumer Line he had explained the procedure to Mthunzi.

He said the contract allows them, on confirmation of the sale, to deduct commission, cost of the auction, advertising and other costs from the deposit.

Leon Roux of Dynamin Auctioneer said Mthunzi signed a binding agreement that was fully explained.

He said they forfeited the deposit due to non-compliance of the terms and conditions of the contract.

"Although they were fully appraised of the reasons of the forfeiture of their deposit and were unhappy, they never approached us for several months to pursue the matter," Roux said.

Comments

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Wed May 22 11:08:52 SAST 2013 ::

May 16, 2012

CheeseBoy

estate agents are thieves. be care ful when you are dealing with these shysters coz they can mislead you. i'm going through a process right now and I have to watch my back every step of the way
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May 16, 2012

CheeseBoy

people must understand that it is not the buyer who pays agent commision but the seller. if you do not understand fully what the contract says find a lawyer who can explain it for you. that service is usually fre.e. if you sign shyte you know nothing about, or do not understand its only you to blame.
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May 16, 2012

dimpho_4U

i once fell victim to hastily signed contracts__do take time signing risk engaging contracts.. loving your artcles @Thuli'S...this time and age people should be very vigilant
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May 16, 2012

tpaz

ndiyabonga
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May 16, 2012

TKay

Thank you for exposing this Lubbe guy. Am house hunting and if I see his name I will run for my life
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May 16, 2012

Lehido

Agents are thieves
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May 16, 2012

Rattex-cannot-be-blocked

White people are big scammers
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May 16, 2012

BlackTruth

@ Cheeseboy the agent mentioned here is not an Estate agent he is in fact an agent for Dynamic Auctioneers, these agents operate differently from estate agents, estate agents gets their commision from the seller not the buyer your right about that.

but in any case you should never pay any money that is not stipulated in the contract or which your not clear what is it for, secondly estate agents do not collect any money either be a deposit or commision, all money goes into the lawyers who will give you an invoice for tax purposes.

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May 16, 2012

iPhone4

Dont they know where he stays? So they can moer that bleksem
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May 16, 2012

Mogwapatholo

never trust a person who is working on commission they are good in lying, very persuasive. The bottom line is for you to sign in the toddet line and you are screwed and all this for the love of Money.
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