Home Buyers Protection Insurance: Cover Legal, Survey & Lending Costs

• The seller changes his mind and withdraws the property from sale
• The mortgage lender valuation is lower than the accepted offer
• The mortgage lender insists on rectification work
• The survey identifies necessary repair work
• The buyer withdraws due to a change in circumstance (such as job relocation or redundancy)

• what is normally covered;
• what isn't covered (limits);
• the critical issue of timing; and
• how much Home Buyers Protection Insurance costs

What is normally covered in a Home Buyers Protection Insurance policy?

Necessary qualifying conditions

• You are over 18 years old;
• Your property purchase isn't subject to a contract race or sealed bids: and
• You are using a solicitor or licensed conveyancer to conduct the conveyancing of the property; and
• You have not had a survey carried out on the property.

What are the insured events covered?

• The vendor withdraws the property from sale because of reasons beyond your control.
• The vendor receives and accepts an offer from a third party which is a minimum of £1,000 greater than the offer from you which was previously accepted by them.
• A Local Authority Search highlights that the property is the subject of a Compulsory Purchase Order (CP0).
• The vendor isn't legally entitled to sell the property or to transfer interest in the property to you.
• You or the person who is buying the property with you:

• die and the survivor is unable or unwilling to continue with the purchase; or
• are given notice of redundancy and you are unable or unwilling to continue with the purchase; or
• are given notice of relocation and you are unable or unwilling to continue with the purchase.

• You are diagnosed with a terminal illness and are unable or unwilling to continue the purchase.
• The initial mortgage lender's valuation of the proeprty is less than 90% of the sum you have offered for the property and which has been accepted by the vendor.
• Prior to the releasing of funds the mortgage lender insists on rectification work being carried out to the property, the cost of which exceeds 10% of the sum you have offered and which has been accepted by the vendor.
• The mortgage lender applies a retention on the loan for the property and this figure exceeds 10% of the sum you have offered for the property and which has been accepted by the vendor.
• The property sustains damage during the period of insurance where the total cost of rectification work exceeds 10% of the property value.

What costs and expenses are you covered for?

• Conveyancing fees
• Mortgage arrangement fees/lender's fees
• Survey fees

What isn't covered (limits)?

• You aren't covered for costs and expenses:

• Incurred before the start date of the policy (this is critical - see the next section).
• If you withdraw from purchasing the property for reasons other than set down above.
• If you're aware before the start date of any circumstances which could lead to a claim being made under this policy.
• If you deliberately and knowingly cause a delay or behave in a manner that results in the failed purchase.
• Where they can be reimbursed by your employer.
• Where you are able to obtain a refund.
• Where, in the case of redundancy, you are self-employed or are a company director or partner of the company giving notice of redundancy or the redundancy is voluntary.

• You aren't covered in the event of war, confiscation or nationalisation by order of any government.
• You aren't covered if events are a consequence of irradiation, properties and effects caused by radioactive matter including via a nuclear attack.
• You aren't covered in the event of consequences of a computer virus.
• You aren't covered because of any development which came about via terrorism.

Why is timing so important?

How much does Home Buyers Protection Insurance cost?