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Following on from an increasing number of calls we are getting from people who have lost life-changing amounts of money to deal sourcers, portfolio building companies, and other such entities, Property Tribes has taken the decision to only allow deal sourcers who are registered with an independent redress scheme to post on this site.As of 2018, there are two Government approved Redress Schemes to choose from:The Property Redress Scheme - our partner schemeThe Property OmbudsmanFor further information on why this is important, please see below:This requirement will also be extended to all lettings agents who wish to post on this site, as they are also required by law to be a member of an ombudsman scheme.If you are a deal sourcing agent or lettings agent posting here, then you will be required to display your ombudsman membership number and which scheme you are registered with.It is recommended that you display that in your signature or at the bottom of your posts.Any agent who cannot provide an ombudsman registration number will have their account suspended.Additionally, we encourage any member who has a professional and/or trade body membership of any kind, to display these in their signature as a "best practice" measure. It is intended that these new measures will aid with transparency, deter rogues posting here, and reward contributors who are compliant and/or have voluntarily committed to professional standards.The reason behind this actionThe deal sourcing arena in particular, is largely unregulated and therefore attracts a large number of unscrupulous operators and rogues, with many one man bands operating with no redress for consumers. Lenders also regard it as a risk, and will very often decline to lend if a deal sourcer is involved.Today we have heard from an elderly lady who has lost £800K to one such operator - she has no contract with the company and no charge registered on the Land Registry for the property she thought she had purchased, even though the deal sourcer has been charging her £6K per month for over 2 years to "manage" her "investment". Needless to say, the individual who has taken this money is not registered with any scheme.The ombudsmen offer up to £25K in compensation for such claims, so at least deal sourcing fees will be covered by this.Some advice to anyone thinking of using a deal sourcer BEFORE you part with any money:1. Ask for their ombudsman scheme number. If they don't have one, walk away.2. Do not part with any money until you have a contract which should be checked by an independent legal advisor.3. Do not pay over large fees upfront for the first transaction. Negotiate a reduced upfront fee. The rest should be paid as a disbursement on completion. This will allow you to try the company out before making a significant commitment.4. Do intense due diligence, and, if in doubt, post here asking for feedback.5. Search Companies House to check that accounts are being filed on time, and the track record of the Director. A long trail of closed or dissolved companies is a red flag.6. Demand transparency - if excuses are made, or documents not sent, or questions not answered, walk away.7. Check that your money will be held in a client money/escrow account.8. Get yourself checked out that you qualify for BTL finance before getting involved in any property deal or handing over fees.9. Check their refund policy - get something in writing.10. Pay on a credit card, benefiting from Section 75 of the Consumer Credit Act if it turns out you have been scammed.See - 4 tips and 5 minutes to stop losing £4K to deal sourcersWe hope this new initiative will increase the safety and security for members using this site, although you are reminded to always undertake your own due diligence and satisfy yourself as to the information.Further reading: How to protect yourself from property fraud For lettings agent due diligence see:How to vet a lettings agent ... 12 questions to ask
What company or person, is the one who has taken the £800k investment off the lady? Is it an organisation who has received comments on PT?
Yes, in the context that there has been many warning threads about this individual and his various companies. The lady contacted us for advice after finding these various threads.
Thanks for the reply.
So as it is a he, is it Gl*** Ar*******g?
No, not that person.
general operations director, site owner and moderator - propertytribes.com
That makes absolute sense.
Would this not be a burden on PTribes? Should you not charge a nominal fee for this annual verification.
As a by-product it would create a nice PTribes Directory of Property Finders that are registered with ombudsman (and therefore have PI insurance too).Then also Letting Agents which has same verification as the above but also a nice filter for those with Client Money Insurance.In addition to mortgage brokers that are authorised and regulated by the right authorities, with ccl, dpa, pi and so forth.
The lettings industry is missing out on a Directory of Letting Services that also verifies businesses for easier due diligence purposes. Perhaps Tribes is missing out on a small revenue stream. Perhaps a property finder would be incentivised also to pay to be highlighted at the top of the listing for example.
_________________________________________________________________________My posts are not financial advice, just a rambling guy passing time on a coffee break.The team at Bespoke Finance offers advice, including Limited Company Buy-to-Let , HMO Conversion and Cheap Life Insurance._________________________________________________________________________
Thanks for your comments and support Adam.We are extending it to lettings agents as well.We will endeavour to police it, but we recommend that all posters display their memberships of professional and/or trade bodies in their signature.Our core focus continues to be around educating landlords how to avoid rogues and undertake due diligence across the property spectrum & commercial interactions ... from deal sourcers and agents ... to tenants and JV partners ... to tradespeople and suppliers of products and services.Prevention is always better (and less stress and expense) than cure, so that will continue to be the focus of the content we deliver.
Vanessa Warwick Landlord and Co-Founder of PropertyTribes.com **If you have got value from Property Tribes, find out how you can support it in remaining a free to use community resource**
Just adding that we would also like the community to help with the regulation where possible. We have always been of the view that community self-regulation is very healthy.So if you are on a thread with a deal sourcer or lettings agent, please feel free to ask them for their ombudsman registration number and please also use the report button if you see anything we should look into.Community self-regulation helps keep our sector safe for all, so please do your bit as and when you can.
I very much appreciate your action, Vanessa and Nick. Well done!
Great work as always Nick and Vanessa.
Splendid start to the New Year!
Well Done x
Learn Change and Adapt ?????
All comments are for casual information purposes only. If you wish to rely on any advice I have given please ensure you obtain independent specialist advice from a third party. No liability is accepted for comments made.