I watched the last 20 minutes of Panorama last night and I was gripped. It was all about Property Investment Compnaies that had ripped people off.  One character was called Simon Morris.  I knew about his serious fraud investigation before it hit the press (I have contacts within the city) but I never knew exactly how he was committing the fraud. It all came clear last night.

He was buying properties at £150,000 and selling them on at £300,000 but paying the 11% deposit for the investor of £33,000.  This meant he got a net profit of over £100,000 per property!  No wonder he could afford to take out 1 page adverts in the Sunday Times!

The reason it was fraud was because:

1. He was getting surveyors to over value properties i.e. getting a £150,000 property to be valued at £300,000.
2. He was not declaring to the lender who loaned the rest of the 89% of the purchase price that he was paying over the 11% deposit.  It is key that the lender knows this as the lender needs to see that you are not just some amateur who has no money and is not prepared for the ups and downs of property management.

Barratt Homes also got a mention blamed for making one of their developments a ghetto!

My advice to you is that if you are going to use a Property Investment Company make sure that:
1. They are not selling property they already own.  This will mean they can hide a lot within the selling price like extortionate sourcing fees!
2. Get a survey independent from the Sourcing Company.
3. Use your own solicitor.
4. Use a mortgage broker who has access to the whole mortgage market.

If you want us to source an investment property for you you can be assured that:

1. We do not own the property.  The only money we make is on the sourcing fees.
2. We recommend you get your own independent survey.  If it doesn't value up we try to renegotiate the price downwards.  If there is no agreement we advise to walk away from the deal.
3. You can use your own solicitor.  If you do not have one you are welcome to use ours.
4. You can use your own mortgage broker.  We recommend you choose one who specialises in buy to let.  If you do not know anyone then you can use ours.

Please be aware there are a lot of sharks out there because the stakes are extremely high. I didn't think they were that high though at £100,000 a time!  Anyway its not worth it.  Simon Morris, 7 surveyors have been ARRESTED and soon to be Simon Morris' solicitors. I don't care how much money you can make in fraud its not worth going to prison which is what is going to happen to the people caught up in this scam.

Good luck with your property pursuits.

If you want high yielding profitable properties please email: enquiries@ahuja.co.uk

Ajay

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Posted on: 26th Jan 2008