Help to Buy - when to pay reservation fee?

kamb1ng

Hi all,

Our offer is accepted by Bloor homes and they asked for £1000 reservation fee.

Should we pay this or should we wait until we get the "Authority to Proceed" from the HCA?

Obviously Bloor wants us to pay this to take the property off the market. We're trying to buy time.

Many thanks.

okborednow

Hi,

I was looking into this myself and it appears you actually can't apply for authority to proceed until you've reserved. The forms specifically ask for the development name and plot number so i'm afraid you will have to take the plunge first

kamb1ng

okborednow wrote: »

Hi,

I was looking into this myself and it appears you actually can't apply for authority to proceed until you've reserved. The forms specifically ask for the development name and plot number so i'm afraid you will have to take the plunge first

Cheers for that.

Bloor is also requiring us to use an IFA they recommend (http://www.evolvefs.com/) and their panel of solicitors. The reason is because they want to make sure everyone involved is familiar with the way Bloor works and can ensure exchange happens in 28 days. Also the fact that they're giving us £500 towards legal fee.

Does that sound familiar?

kingstreet

HTB process;-

- HTB affordability calculator completed by broker
- decision in principle for mortgage
- reservation of property with builder
- completion of property information form
- submission of forms to HCA HomeBuy Agent
- issue of Authority To Proceed
- full mortgage application
- mortgage offer, exchange of contracts etc.

okborednow

Yes it does, we've been encouraged towards particular brokers and solicitors on the same premise. I've met with the broker and she seems very good so i'm not too worried about that. I'm going to get a quote from the conveyancer and see how it stacks up compared to others i've received. The only thing that worries me about your post is you said they require you to use their solicitors. If in fact they are telling you you have to as opposed to they would prefer you to then they are violating the consumer code for house builders. The code is there to protect buyers of new build homes, i'd recommend searching for it on the internet and reading it thoroughly.

Noddy32

Our process has been exactly as Kingstreet outlined above. Interestingly though, we paid £1000 reservation fee a few weeks back and yesterday received a cheque for £500 back from the builder with a letter stating that under the HTB scheme this is the max res fee they can take.

Noddy32

And also if for any reason we had been declined by HTB we would have received reservation fee back in full.

kingstreet

It doesn't really matter what the reservation fee is, as you get it back at completion anyway. It's more like a reservation deposit, rather than a fee, as fee implies it's a charge for a service, which it isn't.

Noddy32

That's what I thought as the £1000 would of been factored into completion monies. Anyway, £500 better in my
bank account than theirs, just imagine the amount of interest I'll make in the next month (sarcastic voice)!

CrispyUK

I've reserved with Bloor recently under the Help to Buy scheme and was told that if the local Homebuy agent declined the HTB application for any reason then it would be fully refundable.

geoffky

kamb1ng wrote: »

Cheers for that.

Bloor is also requiring us to use an IFA they recommend (http://www.evolvefs.com/ ) and their panel of solicitors. The reason is because they want to make sure everyone involved is familiar with the way Bloor works and can ensure exchange happens in 28 days. Also the fact that they're giving us £500 towards legal fee.

Does that sound familiar?

I would run a mile....Ask yourself why they want it all done by people they know.....Look after yourself...