What happens if my estate agent goes out of business?

This is unsettling to read about when your home is on the market. The pieces of a sale that matter most, the contract and the money, are held by the solicitors, not the estate agent. Agencies close, merge and change hands, and sales carry on through it.

Will my house sale fall through if my estate agent closes?

No, not on its own. Once an offer is agreed, the legal work is done by your conveyancer and your buyer's. A conveyancer is the solicitor or licensed conveyancer who handles the legal transfer of a home, and contracts are exchanged between the two legal representatives, not by the agent.

What you lose is the go-between. An agent usually chases the chain, passes on messages and keeps the buyer's mortgage moving, so you or your solicitor may need to pick that up for a while.

Is my buyer's deposit safe if the agent goes bust?

In a standard sale in England and Wales, yes. The government's home-buying guide describes the deposit as a payment passed to the buyer's legal representative on exchange of contracts, and the completion money moves between the solicitors on the day. Neither goes through the estate agent.

If an agent does hold any client money for you, section 13 of the Estate Agents Act 1979 says it is held on trust. Money held on trust belongs to the client, not to the business, which is the protection that matters if a firm fails.

What happens to my agent contract if the firm goes into administration?

Administration is a formal insolvency process in which an insolvency practitioner, called the administrator, takes control of a struggling company. Government guidance says an administrator may try to rescue the company or sell the business as a going concern.

A sale of the business can include its customer agreements, so your instruction may pass to a new owner who then contacts you. If the company is liquidated instead, it stops trading and is closed down. In either case the insolvency practitioner writes to the creditors it knows about.

What should I do if my estate agent goes bust?

1. 1. Confirm what has actually happened

   Check the company's record on Companies House for an insolvency notice or an administrator's appointment, and ask the agent in writing what it means for your instruction. A headline about a firm's finances is not the same as a firm that has stopped trading.

2. 2. Tell your solicitor straight away

   Ask your conveyancer to confirm the sale is proceeding and to chase the buyer's solicitor directly while the agent's team is unavailable.

3. 3. Keep your buyer close through the solicitors

   A buyer who hears the agent has closed may worry too. A short message through the solicitors that the sale is unaffected and on track keeps them calm and committed.

4. 4. Trace any money you have paid

   If you paid an upfront fee by credit card and it cost between £100 and £30,000, you can claim it back from your card provider under Section 75 of the Consumer Credit Act. A debit card payment may be recoverable through chargeback, usually within 120 days, though chargeback is a card-scheme rule rather than a legal right.

5. 5. Find out who holds your agreement before signing elsewhere

   Read your contract for a tie-in or notice period, and ask the agent or the administrator in writing whether it still stands. Instructing a new agent while a sole-agency agreement is live can mean paying two fees.

6. 6. Keep a written record

   Save every email and letter with its date. If you need to claim as a creditor or complain later, a clear timeline makes it straightforward.

7. 7. Relist once the ground is clear

   When you know your old agreement has ended or passed on, choose your next agent on the quality of their valuation, fees and plan, not on speed.

Can I complain if my agent closes owing me money?

Every estate agent doing residential work must belong to a government-approved redress scheme under the Consumers, Estate Agents and Redress Act 2007. The two schemes are The Property Ombudsman and the Property Redress Scheme.

Complain to the agent first, then to its scheme, and ask the scheme what it can still do if the firm has stopped trading. For money owed by a company in administration or liquidation, the route is a claim to the insolvency practitioner as a creditor.

Your sale lives with your solicitor and your buyer. The agent is the messenger, and a new messenger can be found.

How do I protect myself before I choose an agent?

• Prefer a fee paid on completion, so nothing is lost if a firm fails before your sale.
• If you do pay anything upfront, pay by credit card so Section 75 applies.
• Check the tie-in and notice period, and what happens to your agreement if the agency is sold.
• Confirm the agent belongs to a redress scheme before you sign.
• Compare more than one agent's valuation, fee and plan before you commit.

Thinking about a different agent?

Get a second opinion: competing local estate agents value your home side by side on ValuQ, free, always, and anonymously until you choose to connect. Getting valuations does not change your current contract, but instructing a new agent during a sole-agency tie-in or notice period can mean paying two fees, so check your contract first.

Common questions when an estate agent goes bust