The Ombudsman Files: Buyer’s Premium refunded
Summary
The Property Ombudsman upheld a complaint against a property business that retained a £4,000 Buyer’s Premium after a buyer withdrew when a lender refused to mortgage an investment property. The Ombudsman found the attic conversion issue was material and should have been verified or clearly qualified before the buyer committed financially.
Why it matters
For residential property surveyors, the case underlines how unverified information about conversions, mortgageability and approvals can materially affect a transaction. It also reinforces the importance of identifying and disclosing issues that may influence a buyer’s decision before money is taken.
Key points
- Buyer’s Premium was ordered to be refunded in full after mortgageability concerns emerged.
- The issue related to a bathroom located in an attic conversion the lender did not accept as habitable accommodation.
- The Ombudsman said the agent had not shown it verified the conversion’s approvals or clearly flagged the uncertainty.
- Material information affecting mortgageability should be checked before a buyer pays a non-refundable or time-limited fee.
- A further £100 compensation was awarded for avoidable inconvenience and aggravation.
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