supplying proof of funds and id

What Documents and Proof Does Your Estate Agent Need?

When buying a property, your estate agent will ask you to confirm your ID, which is standard practice, however, they will also ask you where you have secured your money from to buy the property. Find out why they do it and what you need to provide.

Proof of ID

Estate agents will ask you for proof of your current address and your identity. It is their legal duty to make sure that you are who you say you are. This is a process of ‘due diligence’, which can form part of these checks. You will be asked for some of the following forms of proof, which you should have on hand to speed up the process.

Proof of name

  • Current passport
  • Residence permit
  • Current UK/EU photo driving license
  • HMRC (Inland Revenue) Tax Notification
  • State pension or benefits book/notification letter

Proof of address

  • Current tax bill from your local authority
  • Rent card or tenancy agreement from your local authority
  • Recent mortgage statement
  • Bank statement
  • Utility bill (not mobile)

Proof of funds

An estate agent can ask for proof of funds at two different stages, for two different reasons. If an estate agent asks for proof of funds before you put an offer in, it may be because they want to make sure you are a genuine buyer who is interested in the property, so that their time and the seller’s time isn’t wasted. However, you don’t have to provide proof of funds before putting an offer in.

If the estate agent asks for proof of funds after you put an offer in, then they are not only checking that you have the money to actually pay for the property, but also that you haven’t acquired the money through criminal means. You must provide proof of funds if asked for it at this stage.

Examples of proof

Proof of funds can be shown with:

Your estate agent can ask you to provide more details of where your money has come from. This is normal practice as all estate agents must conform to the Money Laundering Regulations, and doing thorough checks is standard practice.

Further proof

Depending on where you got the money for your deposit or the property’s price (if you are a cash buyer), the agent may ask for further proof to show that the money has come from where you have claimed.

They may require, for example:

  • A letter from whoever gifted your money (e.g. your parents have given money towards your deposit, won the lottery, left money in a will)
  • Further bank statements from the past months/years (to show how your money has built up over time)
  • Evidence or receipts for gambling winnings, sale of shares or other large amounts of money in your bank account

Best practice is to keep evidence of where all the funds going towards your property purchase have come from; that way you can be prepared if your estate agent asks for it.

Estates agents may perform other checks on you, for example, Google searches. They have a duty in carrying out the right checks and may feel further due diligence is required.

Landlords and tenants

From January 2020, letting agents are also bound by law to perform due diligence checks on any landlord or tenant renting a property with a monthly rent of €10,000 or more (approx. £8500 as of Jan 2020).

If you a landlord or tenant renting such a property, then do not be alarmed if your letting agent asks for any proof like that described on this page; they now have a legal obligation to do so.

Who else requires proof?

Your mortgage lender, solicitor or conveyancer will also ask for proof of where your money has come from too.

If you get asked for proof more than once, do not be put off; it is a legal requirement for everyone to check where your money has come from. Your agent, lender or solicitor could be fined or imprisoned if they don’t undertake these checks.

Remember, your agent, lender and solicitor are all separate; just because you’ve shown proof to one, doesn’t mean the others will have seen it.

Make sure you keep all your evidence together so that you can easily show it to everyone who will need to see it.

Money laundering and the law

Purchasing property in the UK is a common method used by serious organised criminals to launder the proceeds of criminal activity. The sheer size of the property market in the UK and the high value of property assets means that extremely large amounts of criminal funds can be ‘cleaned’ in a single transaction, making it appear that it has been acquired legitimately.

In April 2018, the European Parliament passed the Fifth Money Laundering Directive which contains amendments to the Fourth Money Laundering Directive on the prevention of money laundering and terrorist financing. Member States, including the UK, must implement these new rules into their national legislation by 10 January 2020.

As purchasing property can be expensive, it means that criminals can potentially clean a lot of money at once. For this reason, estate agents must do these checks on everyone buying a property through them, to make sure their money is coming from legal sources.

Use an NAEA Propertymark protected agent

Agents who display our logo are well-informed on the checks they must undertake on their customers and abide to the Government regulations. They will guide you through what proof is required. Different agents may have different procedures in place to check your identity and your source of funds.

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