I went to see george wimpey that I was a teacher and wanted to buy a flat but had no deposit.

The sales assistant at the time told me the flats were being sold for 300k each to which I responded there was no way I could afford to buy one.

She then explained to me that she could give me 15 percent off making the price just 250k avoiding the expensive stamp duty, I then carried on and insisted that I had no deposit how could I buy this flat?

She then told me that the bank would value the flat at 300k on its completion and lend me up to 90 percent of this so that I would get 280k which I could give 250k to george wimpey and keep the rest.

I said I would think about it after which she continued to call me every single day harassing me asking me why I wouldn't want to have 20k in my pocket for free. In the end I agreed and gave her my credit card details which she took 2500 on.

Within a week she phoned me and said that if I didn't give her a further 10 percent that I would lose my 2500. At this point I told her that I never had that money and had only agreed to buy based on the fact I had no money. She said I needed to put 10 percent more down and legally exchange contracts. After she realised I didn't have the ten percent she offered me exchange bond and said don't worry this is an insurance policy so we can carry on.

I filled out all of the forms, and duly exchanged not realising what I was committing to. The solicitors I used, silvers, now silvers arch did not tell me of the liabilities that could arise from this exchange bond.

6 months later Rene had left the site and I was receiving more calls from george wimpey asking me if I had a mortgage. I told them that I never had one and then they asked me about the deposit. To which I responded that I had no deposit and told them what rene had told me. To this they responded that I could not borrow that much and that they had never even sold and of the flats there for 300k in the history of the site (even though this was my contract price). They told me I had better find a deposit and fast, and that if I didn't then they would draw down on their bond and bankrupt me for their loss of income.

At first I didn't understand what they were talking about and then later I felt very cheated, george wimpey had lured me by inflating their sales price 15 percent, made me formally exchange by threatening to make me lose my deposit if I didn't. Failed to explain the complexities of ebond and and if I didn't buy they would come after me for 25k and then bankrupt me.

As a teacher working for very little pay, this will ruin me, george wimpey have been completely ruthless since they got the bond in their hands.

Having spoken to experts on this matter they have stated that:

1) George wimpey misrepresented the sale by inflating their sales price and the rental values then discounting them to still unrealistic levels in order to lure me in as a buyer, apparently this is a tactic they regularly use. I thought I was getting 15 percent off when in reality I wasn't getting anything off, it was on this basis that I got involved. I was unable to do any due diligence because you cannot have a survey or valuation done or even get a mortgage for a flat that is almost a year away from being built so was very vulnerable.
2) George wimpey explained to me how I could buy the flat with no money because it was worth 15 percent more then I was buying it for. They now deny they said this and that it is mortgage fraud.
3) George wimpey knew full well that I could NOT complete especially as I had been very open that I had no deposit, yet still made me sign the ebond, this was so that they could conspire against the bond company and receive 10 percent of the value of their sale even if I didn't buy.

George wimpey at altius has acted fraudelently in many ways:

1) By misrepresenting the sale
2) By making me take out the exchange bond, knowing full well I could not buy the flat, their intention was to defraud the exchange bond company all along by using me as a pawn.

I have also contacted the fsa, as;
1) Exchange bond never advised me I could be liable for 25k in the event I didn't buy the property
2) Exchange bond never told me that the value of the property may go up or down or might now be worth what george wimpey said it was
3) Exchange bond never advised me of the fact I might not be able to finance the property or of any of the pitfalls

I am now forming a lobby of innocent people who have fallen victims to this type of scam and have found george wimpey to be perpetrating this on a very large scale. Can anyone else who has been done by this scam please contact me via this thread?

Can anyone out there help me?

You have simply been naive at best or stupid/greedy at worst. As a teacher I would imagine you have a bit of common sense, did alarm bells not start ringing when you were told by a salesperson you can buy a "£300,000 property for £250,000, not put a penny down as deposit and end up with £20,000 in your back pocket"!!. Did you not compare the price of other new build properties in the area and did you not think to see what you could borrow on a mortgage before committing to such a large purchase. Why did you exchange contracts knowing you had not got a mortgage in place?. Whilst I have a certain amount of sympathy I suspect you just thought " this sounds like an easy way to make money, I put no deposit down, receive £20k from the builder and if house prices rise I sell for a big fat profit". Whilst I think you make have fallen for some salesperson's bull**** you have only yourself to blame for not doing enough research or taking independent legal/financial advice before committing to the purchase.

Well that was a helpful post. Yeah, Im a greedy selfish teacher and I never deserve to make any money or own a property. I should go bankrupt and then kill myself.

I didn't say you never deserve to make any money or own a property, I just pointed out a few facts and I'm sure if you took a step back you may realise this was partly your fault for not taking proper advice, overstretching yourself financially or not doing any basic research. Property like any other asset obviously can go up or down why do you need a "exchange bond" to tell you that. You should not have agreed to purchase the property if you could not afford it and being a teacher I'm sure you would have qualified for a government assisted homebuy scheme or something similar which would have got you on the housing ladder.

Ok second attempt at reply!!

Sorry to here about your problems and I hope you get them sorted out. Unfortunatley I cannot offer you any real advise that would help with your situation. We bought a wimpey recently and it has to have been the worst descision of my life, buying a home from wimpey is not something I would recommend to anyone. Not only was the customer service we very experienced poor but so the quality of there homes.

If you cant get anywhere with solicitors or the FSA try going to the press. Also have you been in contact with citizens advise. They couldnt do anything to help us but they might be able to help you out. Also your solicitor may be liable for not correctly advising you of the risks, you should contact the Law Society.

I wish you all the best of luck!!

Mr XXX,

What can i say..... Spot on!

Screwedbywimpy... Seriously, i hope this is a joke as you cannot expect sympathy. I'm sure Wimpey would describe a completely different story, and not be at a financial loss from you agreeing to buy the property and then not EVER being able to afford it.

One must wonder why you would even be looking at a property if you have no deposit?

Shanks

Well you might not give me any sympathy, but luckily it looks like I dont need it.

Geoerge Wimpey did this all on their contract, they actually lied and I have it in writing...anyone else who is having trouble with george wimpey at the altius development or anywhere else or anyone who has signed up with exchange bond get in contact.

Exchange bond is an absolutely pathetic product, what I have realised is that it is just being used by developers to scam buyers, there is no due diligence done by the exchange bond company and they will issue a bond to people regardless of whether they have financing for the purchase or not. The developers just want people to sign on the dotted line with exchange bond so just push them into doing it, the developer doesnt care if the buyer completes or not as they will get 10% from the exchange bond company anyway. Then the exchange bond company comes after the buyer. Its pure fraud.

If you find yourself in a position like this with exchange bond get in contact, they cant do this.

I was not looking for sympathy from anyone on this post, I was looking for people who can help me, if you are going to waste time going on about how stupid and greedy i have been please dont bother replying, ive beaten myself up enough about this already.

What I find ultimately depressing is that a person of this calibre is involved in teaching the next generation. Perhaps I am being harsh, but the bleating irresponsible and non accountable tone is breathtaking.

If something seems too good to be true, then it probably is.

I think that comment is naive in the extreme!

95% of people visiting this site would be tempted by similar cons, that's what it clearly is. With the media, and society in general, craving ever-increasing property prices to fuel their pathetic conspicuous consumption is their any wonder individuals get blinded by the headlights?

Then it goes bang!

Social housing and re-distribution of wealth will end this madness.

If you're looking for someone to genuinely help you with this problem, this isn't it. You need a lawyer. Good lawyers aren't generally found here, and if they are here, they probably fib about what they do to avoid people looking for free advice that lawyers generally charge £££££s for (since they need to put bread on the table and tyres on their Audis....) You're best seeking lawyers in their natural habitat, or lawyers offices, to give them their technical name.

You wish to form a lobby group for people who have fallen victim of this scam. Nicky Campbell doesn't come here often either (I suspect) but he is probably going to be more help than me. You can find Nicky (or his researchers) at the BBC.

I suspect, thought I can't prove it, that you've fallen victim, not to a carefully perpetrated scam by Wimpey, but to a member of sales staff who decided to push their luck with a customer who seemed naive and gullible. You may find that makes other victims of this sort of thign rarer than you think. Good luck though - it sounds like you've been on the wrong end of a deal.

I think Screwedbywimpy's complaint is precisely that somebody has been redistributing their wealth, just not in a way that benefits them.

@ stuffedbywimpey

I am the Chief Information Officer for The Exchange Insurance Company (ExCo), the insurance company that issues Exchange Bonds.

EXCHANGE BOND - BACKGROUND INFO
The Exchange Bond is simply an alternative to putting down a cash deposit when buying a property off-plan. Instead of handing over a cash deposit (usually 10% of the property contract price), the buyer instead purchases an Exchange Bond, which their solicitors uses to exchange contracts. The buyer pays a premium for this (which is actually often reimbursed by the seller at completion). When the buyer completes the property purchase, they pay 100% of the agreed contractual purchase price and the transaction is finished. In other words, the Exchange Bond® does not fund the purchase in any way.

The principal advantage to the buyer in using an instrument such as an Exchange Bond is that they can either:

(a) invest their cash deposit or keep it in their own bank account earning interest while the property is under construction; or,

(b) if they do not yet have all the funds ready for the deposit, it means they can secure the plot, fix the price, exchange contracts, and use the construction period to save the necessary deposit funds at their convenience. From the developer's perspective, the Exchange Bond helps to secure a sale.

Should the buyer not complete the purchase, the seller then claims the deposit amount from ExCo under the terms of the Exchange Bond. (If a buyer had used a cash deposit and fails to complete, the seller retains the cash deposit which the buyer forfeits and is standard practice.) ExCo then recovers the deposit amount from the buyer. Had the buyer not used an Exchange Bond, they would have lost their cash deposit at this point anyway, so they are no worse off, in fact they are in exactly the same position they would have been had they put down a cash deposit.

The Exchange Bond is designed to help facilitate the transaction for both buyer and seller.

ABOUT OUR BUSINESS PRACTICE
It is important to ExCo that none of our customers feel aggrieved. We believe in transparent and open business practice, and never want to be accused of providing a less than professional product and service. We are aware that it easy for a company in our position to be accused of sharp practice. Therefore, we take great care to ensure the customer is fully informed. The steps we take include:

1. Insisting the customer takes independent legal advice when using an Exchange Bond, usually via their own solicitor.

2. We ensure that the following key point is clearly stated (not hidden away in small print) on all paperwork: a buyer must repay us for any claim on the Exchange Bond made by the seller if they do not complete the purchase.

3. We issue the Exchange Bond certificate directly to the buyer’s legal advisor.

4. We provide a ‘cooling off’ period where a full refund can be requested.

As part of our underwriting process, we always undertake a credit check on our customers. However, it is impossible to check a mortgage offer for those buying off-plan, since the property may be years from completion. We have to assume, therefore, that the customer has the ability to arrange finance for the purchase. Unfortunately, the present economic climate has left some buyers unable to source a mortgage at a sufficient loan to value or, indeed, not all, when historically they would normally have been able to do so. We do assume that the buyer does wish to purchase the property and is doing so of their own free will!

ABOUT THE POST ABOVE
I would urge the original poster to do two things:

1. Take independent legal advice.

2. Contact ExCo and talk to us. I can assure you that we will deal with this at the highest level.

I hope this is helpful.

---

Justin

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.

Or, to put it another way, I know your product is a syupid product because I was stupid enough to buy it.

Hmmmmm.... Hang on a minute there....

This thread has an air of madness about it...

"Should the buyer not complete the purchase, the seller then claims the deposit amount from ExCo under the terms of the Exchange Bond. (If a buyer had used a cash deposit and fails to complete, the seller retains the cash deposit which the buyer forfeits and is standard practice.) ExCo then recovers the deposit amount from the buyer. Had the buyer not used an Exchange Bond, they would have lost their cash deposit at this point anyway, so they are no worse off, in fact they are in exactly the same position they would have been had they put down a cash deposit.

The Exchange Bond is designed to help facilitate the transaction for both buyer and seller."

What a silly thing to say, what you dont realise is that the transaction would not have happened if exchange bond hadnt issued a bond (so that a buyer with no money could commit 10% to a property there has been no due diligence on).

The bottom line is that the purchaser would not have exchanged if there was no bond. Your product facilitates people to make promises of money to developers they dont have based on assets that could go up or down in value.

And Mr. Banker, yeah, Im one of those idiots who got involved...and what? what is your point? why do people love to put useless posts on here? if you arent interestedin helping then stop wasting your time, I have had enough of the "your so greedy" "your so stupid" posts, yeah Im stupid and greedy happy? no need to waste posts on saying those things now.