the key to challenging is this within the following - that the bond writers and property sellers have 'an agreement'

in practice this means agreement in the amount they actually settle at.

Consider the following - u think ur £200 insurance premium really allows Exchange Bond to Pay Wimpy £25000 if u default?

Think about it! They would have to take 125 premiums to pay for just one defaulter if they really were offering independent insurance!

Sharpie:

Hi

I'm just wondering what your outcome was with the Exchange Bond. I am in a similar boat to yourself, and I have the developer trying to make me 10% deposit on a property I can not afford.

I have done myself to try and resolve this with the developers but I am faced with a brick wall.

Really appreciate if you can give some advice.

IF YOU CANT AFFORD IT WHY DID YOU AGREE TO BUY THE PROPERTY !!!!!!

exchangebondvictim:

Justin what can you do for me?

Your letter says you will pass me on to a debt collector adding £500 to the debt.

I live in a council house, earn minimum wage and have just had my dream of getting a house shattered.

I have no savings and no assets, how can you help me?

Taylor Wimpey knew I couldnt buy that property, they just wanted me to sign the bond for their 10%.

If you were on minimum wage, how did you plan to save the money to pay the deposit that this bond covered?

exchangebondvictim:

Yea thats a silver lining, and the fact that george wimpey will probably go into administration soon, so the crafty sales person who got you into this position will lose their job.

Screwedbywimpey, Im actually in the same position as you, and I dont know what to do, the bond company has written to me saying they are going to pay wimpey this week, and requested me to pay them they even sent me their bank account details, and said if I dont pay they will hand me over to a debt collector.

Wimpey really screwed me, I live in a council flat, have no assets no income as I lost my job recently, this was supposed to be my dream home, the lady at wimpey told me I could have it for no deposit.

What do I do now? The sales woman from wimpey even called me recently to sell me more property telling me to do the same thing with the bond. Do you think she takes a cut from the bond company or something as she just wants signed bonds and is really pushy. I told her what happened to me on this flat she told me and she had to get off the phone suddenly, cow!

I guess, with my life, its been disadvantaged from day 1, I was brought up in care, and now I will probably die in a council flat, oh well at least I tried to get my own place and better myself. I'll probably have to work the rest of my life to pay off the bond company so that wimpey can get money for nothing, and now I will never have my own place. Now I'm just feeling sorry for myself.

Please comments stating that I have been stupid and naive like screwedbywimpey dont bother, anyone who can help, please get in touch through this post.

I can see the problem with these bonds. They certainly seem to be something you need to think about carefully before signing because you can get well screwed.

I must admit you have every sympathy from me, but at the end of the day didnt you realise this might happen? Did you get advice first?

screwedbywimoey:

Geez exbanker, with guys like you not being able to recognise that the whole system is being taken advantage of by developers screwing people by exchanging when they dont have the money just to get the 10% then I guess Im not surprised people like you brought and sold sub prime debt to get us into the problems we're in at the moment.

Look up negligent in the dictionary, as you clearly dont know what you are talking about, I was not negligent and acted in good faith, the bond company had a responsibility to its customers to check values that the developer was giving were real.

Yea, this ranting doesn't help, and I'll blame exbankers like you, for everything, all the problems, the unemployment, everything it was bankers that caused all this.

Good luck finding a new career, I hear mcdonalds has some vacancies, or you could try your luck with taylor wimpey, bankers are good at screwing people.

You just dont even listen, do you? Maybe thats the whole problem with this. A previous poster has explained how bonds work but you still seem to think its their fault.

And now you're being rude to someone else. Please tell me where you live and which school you teach in just in case my kids go there !!!

screwedbywimoey:

Thanks for the reply Mr. Exchange Bond, its heart warming to see you came on the forum and wrote the above post.

I am not sure who came up with the concept of Exchange Bond, but who ever did, I think they should seek mental help in the form of a psychiatric assesment or get prescribed some shock therapy or something because they are quite clearly insane.

I appreciate your post, and the fact that you want to help people that your company have screwed, this shows some good moral fibre which must be embedded in your company.

To start with I would like to ask you the following question:

BEFORE YOU ISSUE A BOND, WHAT DUE DILIGENCE DO YOU DO ON A PROPERTY?

DO YOU HAVE ANY VALUATIONS CARRIED OUT?

DO YOU CHECK ANYTHING WITH THE DEVELOPER?

WHAT DO YOU DO?

Here is the answer

Absolutely NOTHING, squat diddly thats what you do.(EVEN THOUGH YOU OWE IT TO YOUR CUSTOMERS) - you issue bonds without doing valuations on the property being purchased, you do no legal research no nothing!

You dont check to see whether the developer or seller is telling the truth of the value of their completed product, you dont check to see whether there is an elaborate fruad taking place, all you are interested in is getting people to sign up to a bond and having them exchange as this is when you get your premium.

Clever?

I dont think so.

You see, your companies product is fundamentally flawed in many ways, the first being that you do absolutely no due diligence on the properties you issue bonds on.

Look what could happen (indeed what has happened in the case of this posting)

A develper (george wimpey lets say) has a flat for sale and they say its worth £1m, they have a buyer who has no deposit but you are willing to issue a bond for £100,000 to this buyer. George Wimpey allures the buyer in whatever way they can, and you push ahead with your bond (and take your tasty premium) and the deal gets exchanged.

12-24 months later, the buyer realises that the flat was only ever worth £100,000 and cant raise a mortgage to buy it, so defaults on the completion - in this case George Wimpey (the developer) comes after exchange bond for their £100,000 and draw down on their bond. George Wimpey is very very happy as they should be, they have sold the flat without actually selling it.

Now ethical Exchange Bond company goes after the buyer who defaulted on the purchase because of course Exchange bond acted in "good faith" and will now set the rotweiler dogs on the buyer to pay up that 10%.

LOL - What a good scam! everyone wins, unless of course the buyer cant pay up to exchange bond...

Another way your product is stupid is that you issue a bond, not knowing if someone can raise a mortgage or not, how dumb, I mean if the property is 12 or 24 months away from being completed then a lot can happen in this time, aside from the entire mortgage market changing (which it has) and the fact someone could lose their job and or ruin their credit score this could affect them getting a mortgage.

Why would you take such large risks?

I predict your company, will not make it beyond 18 months from now, you will crash and BURN.

Developers all over the country want to exploit you and WILL eat you alive, the buyers dont have the money to pay you if they default on purchases that have been over priced, or just gone down in value since they exchanged

Justin/Mr. Exchange Bond, I would get your CV ready to start looking for a new job.

Wait a minute. If your stupid enough to agree to buy a property at £1,000,000 when its worth £100,000 (which is what happens when you exchange contracts) whys it a con ????

I'm sorry but did you take any financial /legal advice at all before going into this? If you didnt understand how the exchange bond works WHY DID YOU SIGN FOR IT?

Seems to me you've been signing things and not having a clue what you're doing. Hint: If someone is hassling you to sign up for something, next time tell them to clear off and dont sign something just to keep them quiet.

Admitedly, you've been subject to some dodgy dealing by the sales agent but you've been very stupid.

Also, the guy from the bonds co has offered to help and you've been rude to him. Very poor.

Worrying that someone like you is teaching our children.

Hi

I'm just wondering what your outcome was with the Exchange Bond. I am in a similar boat to yourself, and I have the developer trying to make me 10% deposit on a property I can not afford.

I have done myself to try and resolve this with the developers but I am faced with a brick wall.

Really appreciate if you can give some advice.

@exchangebondvictin

I obviously cant discuss individual cases on an open forum.

Send an email to enquiries AT exchangebond.com (changing the AT for an @) for my attention with your name and contact details and the bond number

I wonder if Wimpey could be 'forced' to return the Exchange Bond uncashed with a legal judgement. Im not a laywer myself but this whole set up doesnt strike me as being ideal.

Its not in the Exchange Bonds best interest to have to pay out to Wimpey either because they havent got a 100% chance of getting it back off u. And to loose £20K for a £500 premium isnt good business sense for them.

I would be interested to hear what 'Justin' offers you as a soluion. My guess is they will try and persuade you to pay a reduced amount back as a loan over a period of time. Its a bit like Poker, will they take a much smaller amount rather than take this risky line of forcing you into bankrupcy and then potentially get nothing!

Plus Wimpey didnt really loose out, because they only lost a sale that they wouldnt have had without u, and they still have the flat to sell!

I have had a couple of ideas regarding this better said off a public forum, if anyone wants to leave their email adress - I'll drop them a line

Justin what can you do for me?

Your letter says you will pass me on to a debt collector adding £500 to the debt.

I live in a council house, earn minimum wage and have just had my dream of getting a house shattered.

I have no savings and no assets, how can you help me?

Taylor Wimpey knew I couldnt buy that property, they just wanted me to sign the bond for their 10%.

The staff at The Exchange Insurance Company (Exchange Bond) do realise how distressing these situations are. We try to telephone all buyers when a claim is made on an Exchange Bond by a property developer.

Of course we don't always get through (numbers change, people are away) and we have to send out the letters because of the timeline of the claim.

I would urge 'exchangebondvictim' (and 'screwedbywimpey') to contact us ASAP and discuss the situation with us.

BTW The Wimpey (or any other builder's) sales person is not on commission from Exchange Bond.

Yea thats a silver lining, and the fact that george wimpey will probably go into administration soon, so the crafty sales person who got you into this position will lose their job.

Screwedbywimpey, Im actually in the same position as you, and I dont know what to do, the bond company has written to me saying they are going to pay wimpey this week, and requested me to pay them they even sent me their bank account details, and said if I dont pay they will hand me over to a debt collector.

Wimpey really screwed me, I live in a council flat, have no assets no income as I lost my job recently, this was supposed to be my dream home, the lady at wimpey told me I could have it for no deposit.

What do I do now? The sales woman from wimpey even called me recently to sell me more property telling me to do the same thing with the bond. Do you think she takes a cut from the bond company or something as she just wants signed bonds and is really pushy. I told her what happened to me on this flat she told me and she had to get off the phone suddenly, cow!

I guess, with my life, its been disadvantaged from day 1, I was brought up in care, and now I will probably die in a council flat, oh well at least I tried to get my own place and better myself. I'll probably have to work the rest of my life to pay off the bond company so that wimpey can get money for nothing, and now I will never have my own place. Now I'm just feeling sorry for myself.

Please comments stating that I have been stupid and naive like screwedbywimpey dont bother, anyone who can help, please get in touch through this post.

I think this is a shocking story - I hope some resolution is found.

The only silver lining I can see is that the way property prices are going the flats probably worth less than 200k now, so by not going ahead it may have saved £100k. Add on to that Wimpeys epensive Maintenance charges - owning one of these flats can cost a fair bit just in those monthly bills

Is there anyone else you'd like to blame for your troubles?

Me? The gnomes of Zurich? The gnomes at the end of your garden? The noises in your head?

You need to get a grip. I didn't make you sign documents you didn't understand at prices that were simply daft. You did it. I think you were negligent. So what? It doesn't matter a jot; you're just wasting bandwidth having a rant about your own failures and your own mistakes.

If you'd started this thread in the spirit of sharing experiences, explaining to others where you went wrong and how they could avoid the same mistakes I'd have every sympathy for you. But you haven't. So I just think you're a muppet.