16:47 PM, 30th November 2011, About 10 years ago
Over the course of the last 3 years at Landlord Action I have been contacted by many disgruntled investors trying to claim back sourcing fees or deposit monies paid to rogue property investment and sourcing companies.
Awareness of this has needed to take on paramount importance since we hit recession in late 2008. Lending stopped and sourcing companies were not able to complete on property deals offered to clients because of lending criteria, and the companies kept the money to use as cash flow to continue to run their businesses.
The industry does need to be regulated; I have heard some real horror stories of people losing their life savings. Unfortunately, some investors are naïve and greedy. If you enter into a business transaction with a company, always ensure you take legal advice on a contract. If a deal does not complete, ensure that you will get a full refund back or the fees are paid once you exchange contracts.
There are too many portfolio building companies out there that are hiding behind their terms of business which are so outweighed against the investor that the investor has to take expensive litigation and hope the company and individual they’re dealing with is not insolvent.
Make sure you do your due diligence, credit checks, check as to whether there are any outstanding judgement services and do your thorough research before handing over large amounts of monies. Beware.
Paul is the founder of Landlord Action, a specialist in tenant eviction and debt recovery.
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