Brighton worst for Gazumping in UK

Brighton topped the charts with 34.9% of people having been previously gazumped when buying a property – this is followed by 31.9% in London.

Outside of the South East the average drops from 22% to 18%. Birmingham figures show 27% of property buyers in the area have been gazumped with Sheffield at 22%, Bristol at 21%, Leeds and Nottingham at 20%.

Gazumping is not a new concept it has become a more regular occurrence across the country, the industry has responded by offering Gazumping Insurance from £80 to refund up to £1,500 in fees that have been paid to Solicitors, Valuers or Mortgage Companies.

The research also found that the higher the price of the property, the more likely you are to be gazumped.

Russell Quirk, CEO of online estate agent, said: “It is one of those things in the current structure of property purchasing unfortunately. Buyers that have displayed honest interest in a property only to be let down by owners with pound signs in their eyes, often encouraged by traditional estate agent looking to increase his fee percentage.”

You can read also 6 Tips to avoid being gazumped, which is mainly about being prepared and being able to move fast to lockout any competition.

Source: Estate Agent Today


Posted in Buy to Let News

More Landlord Regulation; with a bribe

The NLA is supporting the The Chartered Institute of Housing (CIH) as it proposes further landlord regulation, sweetens proposal with a Tax Cut bribe.

CIH recommendations include extra Housing Standard regulation above the Housing health and safety rating system (HHSRS).

Besides mandating how agents run their business by insisting on landlords pay for referencing and not tenant.

The report starts off by outlining the “challenges” prs has in that it provides bad property conditions, bad management, unaffordable homes and offer little security.

The CIH acknowledges the Housing health and safety rating system (HHSRS) but is dismissed due to councils under-funding it. The suggested solution is an additional “legal backstop is needed” as 33% of the PRS does not meet “modern standards”.

The CIH acknowledges that many landlords offer “good quality” management of their properties. It goes on to suggest landlords do not know the law and uses shelter data that 700,000 tenants are living with electrical hazards (despite HHSRS legislation). The suggested solution being Accreditation Schemes.

The CIH identifies issues with “affordability”. It outlines the issue is landlords asking for Referencing, Deposit and Rent in Advance. The suggested solution being to ban referencing fees. Perhaps not understanding “cost of sales” are paid by the customer not the supplier.

The CIH acknowledges flexibility in the PRS with six month rolling tenancies. It outlines Shelter data that 10% of children have to change school due to moving home. The suggested solution being to mandate landlords offer longer tenancies via extra regulation.

The The Chartered Institute of Housing (CIH) who’s board is made up of Council and Housing Association staff. Today wants government to install extra regulation on how to run your business. It offers higher costs of running your small business. Including removing your flexibility to offer security on your terms.

Their is though a bribe of lower tax’s – a discount off the invoice to replace electric heaters with central heating. Of which the CIH suggest a reason why PRS does not meet “modern standards”.

The CIH trying to install Housing Association style tenant demands fails to resolve any “issues” it identifies.

Instead of extra regulation on housing standards; the CIH could have suggested council’s lift their finger against dodgy landlords. Lack of funding not being a reason to let tax payers down on their legal minimum standard of living.

The CIH fails to acknowledge that landlords want longer tenancies and easier access for tenants to housing but rental arrears and “professional tenants” remain issues. With Section 21 viewed as some as the only recourse and mortgage lenders limiting terms it can be unwise to offer longer tenancies or remove entry fees.

Instead of demanding Landlords don’t charge tenants for referencing. A “tenant certificate” from a national reference service could have been proposed; offering security yet cutting costs.

Instead of legislation to mandate how agents are run; empower landlords to instruct there agents on how they want their SME to be run.

Read CIH press release or you can download the report: More than a roof: how incentives can improve standards in the private rented sector

Posted in Buy to Let News

1% of RBS/Natwest Mortgages are Compliant

The FCA has reported that “Only 2 of the 164 sales reviewed were considered to meet the standard required overall in a sales process.”

Failings include:

  1. Failing to consider the full extent of a customer’s budget
  2. failing to advise customers who were looking to consolidate debt properly
  3. not advising customers what mortgage term was appropriate for them
  4. advisers giving personal views on the future movement of interest rates
  5. borrower being sold the wrong type of mortgage for them.
  6. RBS did not adequately address the failings when concerns were raised about the quality of the advice

Taking out a mortgage is one of the most important financial decisions we can make. Poor advice could cost someone their home so it’s vital that the advice process is fit for purpose. Both firms failed to ensure that their customers were getting the best advice for them.

For the reasons given, the Financial Conduct Authority imposes on the Firms a financial penalty of £14,474,600 – (they did give them 30% discount for paying quickly! ).

The FCA outlined that 4% of RBS/Natwest mortgage sales FAILED TO THE DETRIMENT OF THE CUSTOMER.

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Just another reason to use a good Mortgage Broker; Bespoke Finance has external compliance check to ensure our process is correct and finance products not missold (files even checked on BTL, despite it not being regulated).

Posted in Buy to Let News

Property Investor Confidence (Q2 2014)

According to research by conducted by  The Mortgage Works and BDRC Continental has shown that Property Investor Confidence is growing.

Confidence in Rental Yields remain stable at 63% dropping by 1% – denoting little decrease in tenant demand/viod periods for landlords.

Whist Rental Yield Confidence remains stable, the confidence in Capital Gains between 2013 and 2014 has increased by17%.

If we keep talking rising prices; property investor confidence in capital gains will see such large increase. That confidence perhaps should be London centric with there anticipated Rental Price Increase outstripping those other regions.

Q2 2014 compared to Q1 2014, Capital Gains confidence has increased 1% but Rental Yield confidence has decreased 2%. Perhaps in relation to Benefits Changes such as Cap’s and the continued introduction of Universal Credit.

See Also: Property Investor Confidence (Q1 2014)

Posted in Buy to Let News

TMW now includes Rent Guarantee Insurance

The Mortgage Works (TMW) is to offer a six month rent guarantee period to new buy-to-let customers.

The buy-to-let lender has teamed up with Rentguard Insurance to offer this feature to landlords.

TMW said it hoped the move would help ‘stabilise and professionalise’ the market.

Henry Jordan, managing director of TMW, said: “Peace of mind is particularly important for new landlords taking their first steps into buy to let and dealing with missed payments and/or tenant related issues are among their main concerns.

Offering new customers the benefit of such cover is just one of the ways in which TMW is helping landlords approach their buy to let investment confidently and responsibly.

Customers can claim:

  • The policy pays out up to £2,500 a month in missed rent (up to a maximum
    of £15,000 per claim).
  • It also covers landlord’s legal costs up to £25,000 per claim. This includes
    any courts costs and solicitor or bailiff fees arising from any legal proceedings
    which may unfortunately need to be taken against the tenant.

Steve Jones, managing director of Rentguard, said: “Rentguard are delighted to be working with TMW to provide new landlords with free rent guarantee and legal expenses cover to protect their investment; giving them increased peace of mind.”

Source: TMW Press Release and Mortgage Solutions

Posted in Buy to Let News

6 Tips to avoid being Gazumped

The downside of a buoyant market is that buyers are prepared to pay a premium to secure the right property.

Even if that can lead to a out-bidding (gazumping) process, leading people to obtain Gazumping Insurance.

The stressful experience of the most expensive purchase of a persons life, can turn distressing if gazumped at the last minute.

It can take months from an offer being accepted to exchange – during this time you ave vulnerable to the buyer accepting a higher offer.

You can take steps to minimise the risk:

6 Tips to avoid being Gazumped

1. Finance Preparation

Before making an final offer have everything ready to go this can include a Mortgage Offer if not at the least get a Decision in Principle from a Mortgage Broker.

Have your deposit sum is in one account ready to transfer to conveyancer and provide “proof of deposit”; you have checked your credit report to ensure its all clean; you have 6 months bank statements, payslips and had your ID and proof of residence certified at the post office ready to provide to Broker and Conveyancer.

2. Find a GOOD Conveyancer

Have a conveyancer lined up; one recommended from your broker may work with them quickly for an efficient process. Once your offer is accepted – instruct them to complete the searches and start communication with the vendors conveyancers.

You really want a recommended conveyancer as those with “Quick” in there name can be the slowest! You can ask Bespoke Finance to Find a Efficient Conveyancer and provide a free quote.

3. Clear Communication with The Estate Agent

Ensure the estate agent knows you are serious; you can state that your offer is conditional on the property being withdrawn from the market, to leverage your offer to make them remove it off of the market. This may not be fruitful if the property received high amount of interest.

You can also ask your broker to provide them with a Decision in Principle certificate to provide confidence to the Agent and the Vendor.

4. Lockout Agreement

You could offer a non-refundable deposit to secure a lockout agreement. You need to make sure an experienced conveyancer handles the agreement.

If you fail to proceed then you can loose the deposit but if the vendor backs out you can obtain funds via the contract to cover your looses.

5. Chain Free

You may want to consider being chain free when you make the offer. If you currently own a house, you could sell this first and move into rented property before starting the search for your new home.

6. Exchange Quickly

Instruct your solicitor and surveyor immediately and do everything possible to speed up the process – as it’s only once you’ve exchanged that there’s no possibility of being gazumped.

7. Obtain Gazumped Insurance

If all else fails; you can obtain Gazumped Insurance to cover your costs up to £1,500 with a fixed fee of just £79.50.

Posted in Buy to Let FAQ, Buy to Let News

85% LTV comes to BTL Renovation

A mortgage broker may recommend KRBS for their speciality; 85% Loan to Value purchase or re-mortgage product.

A more unknown company (owned by the same group as KRBS) TODAY launch a speciality of their own for your refurb projects.

Bob, a builder, from today can purchase a renovation project at 75% loan to value. This at a low rate from 0.65% per month, which can be rolled up for up to six months.

After the renovation, Lender will ask a surveyor to assess the property to get its New value.

After the refurb you will them be able to refinance at 85% of the new value.

This new product meets the demand for a mortgage product that allows a refurb period to allow you to enhance the value and earnings potential of a BTL property with the view of holding.

Removing the need of temporary and expensive bridging finance and avoids the “six month rule” on refinancing with an exit of up to 85% LTV.

Call 08009202001 and talk to an advisor.

Posted in Buy to Let News