Gazeal’s technology provides a digital legal pack signed by buyer and seller that it claims significantly improves the certainty of the deal.
The agreement sees the buyer pay a non-refundable fee of 0.075 per cent of the purchase price.
If buyer or seller renege on the agreement they become liable to pay the other one per cent of the purchase price.
The majority of MAB’s 1,433 advisers operate out of estate agencies and the firm’s chief executive Peter Brodnicki welcomed reservation agreements as a way to speed up the transaction process.
“The process and platform Gazeal has introduced brings the mortgage in at the beginning of negotiations. Engaging with a mortgage adviser as early as possible in the home buying process makes complete sense,” Brodnicki said.
“Getting an upfront commitment from the buyer and seller gives comfort to both parties. Anything that brings a level of certainty into the home buying process can only be a good thing,” he added.
Bryan Mansell, consultant at Gazeal, said: “Understanding the availability of the right mortgage is often left to the last minute and we fully support the need to explore this much earlier in the buying process, ideally before viewings and definitely before offers are submitted.”
The Ministry of Housing, Communities and Local Government has confirmed that it is considering a trial of reservation agreements in selected regions next year, depending on the results of current consumer research, the Guardian reported.
About a third of UK property transactions falls through between the offer and exchange stages currently, according to RightMove.