Frequently Asked Questions
Q: What is the cost?
A: The premium for the option is normally 2.6% of the agreed Purchase Price for properties located within the UK plus £300 brokerage fee. All prices are plus VAT. For non UK properties the typical premium is 3%. VAT, or any equivalent tax, is payable on all premiums and is calculated at the applicable prevailing rate of the country where the property is situated. The cost for secure documents to be sent via DHL is £23 which is payable on acceptance of offer.
Q: How is my property valued, to arrive at the agreed Option Purchase Price?
A: The Provider undertakes its own valuation assessment at no cost to you to determine the current value of the property (the Purchase Price). Normally a physical inspection of the property is not required. If you do have a recent valuation or any other comparable evidence, please provide this to your broker as the provider will consider this when assessing the value of your property.
Q: Can the providers buy my house or exercise the option without my consent?
A: No. Absolutely not. The option lies with the property owner and may only be exercised by them. The option providers cannot buy your property unless you specifically want them to within the terms of the Option Contract.
Q: What Property types are eligible to have Options
A: Houses, flats, buy to lets, second homes, holiday homes, Off-Plan, UK and those in some overseas territories. Any property which is freehold is usually elligible and in the case of leasehold, the property must have 91 years or more left on the lease.
Q: What properties are not allowed?
A: Commercial properties cannot currently be covered.
Q: What Countries are eligible now?
A: UK and Spain will be available soon.
Q: What countries should be eligible over the next year?
A: Caribbean, USA, Portugal, Sweden, Gibralta, Canada France, Ireland, Cyprus & Turkey
Q: What about Off-Plan properties?
A: These are acceptable, so long as a current RICS Valuation is available. The option period will start as soon as the Option Contract is signed and paid for, NOT on completion of the property! In addition, the new building must also have the requisite contractor insurances in place, in order to qualify.
Q: Is the Option assignable?
A: Yes - the option may be assigned to any person or legal entity,
Which includes but is not limited to: successors, beneficiaries, mortgage lenders or subsequent purchasers of the property. The Option Providers must be informed of any assignment as explained in the Welcome Pack that you receive upon taking out the option.
Q: What are my obligations?
A: Your general obligations are to maintain the property, ensure relevant insurance policies (i.e. buildings insurance) are in place and not to make any structural alterations or additions to the property without the prior written consent of the providers, who will normally give permission as long as the alterations do not devalue the property. Further details regarding your obligations can be provided and are detailed in full within the option contract.
