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The Property Podcast
ASK448: How do I avoid New Build scams? PLUS: Do I really need a solicitor?
Oct 1, 2024
Johnny, a property seller from London, explores how to navigate the tricky landscape of off-plan developments while avoiding scams. He seeks advice on verifying developer reliability and conducting due diligence. Meanwhile, Gary questions the necessity of hiring a solicitor for his limited company mortgage, wondering if he can tackle it solo. The discussion highlights the importance of careful research and understanding legal implications, ensuring listeners are well-equipped to make informed property decisions.
08:10
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Quick takeaways
- Conducting thorough due diligence on off-plan properties is essential to avoid scams, particularly by avoiding excessive deposits and seeking independent verification.
- Engaging a solicitor for mortgage review is advisable as it clarifies personal guarantees, ensuring compliance with lender requirements, despite potential added costs for the borrower.
Deep dives
Ensuring Trust When Buying Off Plan
When considering purchasing off-plan properties, it is crucial to conduct thorough due diligence to avoid potential scams. A warning sign to watch for is excessive deposit amounts, such as 25% to 50%, which often indicate higher risks associated with the investment. Developers may offer 'protection' through solicitors they recommend, but this protection can be weak, making it essential to rely on independent verification. Opting for a deposit capped at 10%, ideally backed by insurance or held in escrow, can safeguard investments while still providing access to the benefits of off-plan purchases.
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Discover
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