How much did you pay for your unit(s) in Bansko!

[Jain and Chris]

Hi all, I have just now sent an email to a company who I believe may be able to assist as they have excellent communications with banks offering BG mortgages, asking them if they can. I'll get back to you when I get an answer from them.

However, I must say that I am not surprised a bank would not include furnishings and VAT, I don't think they would anywhere in the world. All they are interested in is the bricks and mortar so to speak as this is their only fall-back if anyone were to default on payments.

Get back to you later,

 

[Jain and Chris]

Just got a reply.

The person I contacted is Chris Downham of Bulgarian Home Loans. He said this:
"Hi Jain

There would be nothing that can be done with actually getting better valuations etc.

We have this situation with many clients and we always have managed to find some sort of UK based solution.

Usually a further advance, secured loan or personal loan, we look at clients situation and decide the best thing for them (taking into consideration all factors).

The banks seem to be worse than ever and are now happily back tracking on decisions that they previously made.

I'm sure we can help these clients. Cheers, Chris"

If anyone would like to contact him his email is [email protected]

His company is UK registered and based. Chris is a great guy and the company has been operating in the Bulgarian marketplace for many years. They are fully compliant with all UK requirements for companies working in the financial sector. I know they have excellent connections with over a dozen banks lending in the BG marketplace.

Please do say that I passed you his details.

Hope this helps and you all find a resolution to the problem.

Best wishes

 

[Topcat1961]

Why isn't this explained at the beginning?

Hi all, I have just now sent an email to a company who I believe may be able to assist as they have excellent communications with banks offering BG mortgages, asking them if they can. I'll get back to you when I get an answer from them.

However, I must say that I am not surprised a bank would not include furnishings and VAT, I don't think they would anywhere in the world. All they are interested in is the bricks and mortar so to speak as this is their only fall-back if anyone were to default on payments.

Get back to you later,

Hi Jain,
thanks for this but I am concerned that none of this was explained to me when I purchased the property. If it had, I would have thought twice about it. 20% of the property price is a large amount to suddenly finance, and I was not given any breakdown price of the furniture cost (they could have charged anything). It was sold as seen with all the trimmings and i do feel deceived by the agent. How can people make informed decisions when they are not being given all the facts? This whole process has turned into a nightmare and it seems that I just fell into a big fat honey trap, obviously I take some responsibility for this but I thought that I was dealing with a professional company who were trying to help me realise a dream.

 

[Jain and Chris]

Well, yes, maybe you did fall into a trap, maybe not.

I don't know why things aren't explained at the beginning... but then I suspect a property agent in England wouldn't spend time explaining things to foreign purchasers either.

Get in touch with Chris Downham, I'm sure he'll try and help - and probably will be able to.

By the way, does your prelim contract state whether VAT is included or excluded? That will tell you the total price.

Meanwhile, let this be a note to everyone - VAT on the purchase price does not count in bank valuations (it wouldn't in the UK either),nor do furnishings (again they wouldn't count for mortgage purposes either in the UK). The banks are acting in exactly the same way as they would in the UK - bricks and mortar valuation only. So, Bulgaria is no different to the way the UK considers mortgage applications.

I'm sorry you feel you've been deceived but I think the banks are acting in exactly the same way as they would in the UK - bricks and mortar valuation only. So, Bulgaria is no different to the way the UK considers mortgage applications. Maybe the lender should have made this clear? Maybe the agent? I don't know.

But I really hope you get it resolved soonest.

All best wishes

 

[Topcat1961]

Well, yes, maybe you did fall into a trap, maybe not.

I don't know why things aren't explained at the beginning... but then I suspect a property agent in England wouldn't spend time explaining things to foreign purchasers either.

Get in touch with Chris Downham, I'm sure he'll try and help - and probably will be able to.

By the way, does your prelim contract state whether VAT is included or excluded? That will tell you the total price.

Meanwhile, let this be a note to everyone - VAT on the purchase price does not count in bank valuations (it wouldn't in the UK either),nor do furnishings (again they wouldn't count for mortgage purposes either in the UK). The banks are acting in exactly the same way as they would in the UK - bricks and mortar valuation only. So, Bulgaria is no different to the way the UK considers mortgage applications.

I'm sorry you feel you've been deceived but I think the banks are acting in exactly the same way as they would in the UK - bricks and mortar valuation only. So, Bulgaria is no different to the way the UK considers mortgage applications. Maybe the lender should have made this clear? Maybe the agent? I don't know.

But I really hope you get it resolved soonest.

All best wishes

HI Jain

Is there any way that people can obtain figures for what agents' fees are on each property as I've also been told that this figure is also taken away from the purchase price? I'm not blaming the banks or how they operate but |I do think that it is irresponsible of the agent not to mention these extra costs. basically I'm paying in cash for the agents fee without knowing what it is or having agreed to it. This is not the same as in the UK.

 

[Jain and Chris]

Well, you need to ask the agents, just as you would in the UK, as to what their charges are.

What extra costs do you feel are involved here from the agent?

Why are you paying in cash? Do you mean travelling to Bulgaria and paying in cash or do you mean you are paying by bank transfer? If you are paying by bank transfer, do you say on your transfer payment what this is for? If so, this is traceable....

Of course agents fees are taken off valuation by a bank... they are only interested in bricks and mortar valuation - exactly as in the UK

Would you buy a property in the UK without clarifying these things?

Naturally you can obtain figures concerning the price you pay for the property, price yo pay for the f&f, price for estate agency fees........ you only have to ask, simple as that

Good luck

 

[Topcat1961]

Well, you need to ask the agents, just as you would in the UK, as to what their charges are.

What extra costs do you feel are involved here from the agent?

Why are you paying in cash? Do you mean travelling to Bulgaria and paying in cash or do you mean you are paying by bank transfer? If you are paying by bank transfer, do you say on your transfer payment what this is for? If so, this is traceable....

Of course agents fees are taken off valuation by a bank... they are only interested in bricks and mortar valuation - exactly as in the UK

Would you buy a property in the UK without clarifying these things?

Naturally you can obtain figures concerning the price you pay for the property, price yo pay for the f&f, price for estate agency fees........ you only have to ask, simple as that

Good luck

Too late now, I have learnt a lot and would certainly not encourage any of my associates to buy in Bulgaria. There's too many added-on costs that are not made clear at the beginning and certainly not imparted to a buyer when they are paying the reservation fee.

You seem to support this 'lambs to slaughter' hard sell. I am a professional person and I certainly didn't expect to be 'lied' to to get a signature, I was naive and taken in and will have to pay the price but I will try to help others from making the same one. It all comes down to making an 'informed' decision and I made the mistake of relying on an agent to be moderately honest with the facts instead of preparing myself beforehand.

 

[Jain and Chris]

I definitely don't support lambs to the slaughter selling techniques in any profession.

However, I am confused here with what you are saying as surely you have a preliminary contract which details the price paid and shows whether this includes the 20% VAT or excludes it. Also, based on the price in this contract, compared with the "all in" price which the agent gave you, you should be able to deduct the price of the property from the total price and this will tell you what the agent's commission is. It's worth bearing in mind that a lot of off-plan property is sold without the buyer being charged commission by the agent as the developer pays the agent a commission - so maybe you aren't even paying a commission to the agent? Why not ask the agent these questions and also look at your prelim contract again for the details of the price and VAT.

I'm not sure the agent "lied" to you and I don't think from what you say he has "added on" any costs: he probably expected that you knew the info from the prelim contract where the price and VAT would have been shown. Although, even having this contract, I do agree that a really good agent would have clarified the details with you, particularly if they knew you were taking a mortgage to buy the property.

I'm really sorry that you find yourself in this position but hope that the contact I found for you (and the others) can help find a resolution for you.

 

[Godfather6]

I definitely don't support lambs to the slaughter selling techniques in any profession.

However, I am confused here with what you are saying as surely you have a preliminary contract which details the price paid and shows whether this includes the 20% VAT or excludes it. Also, based on the price in this contract, compared with the "all in" price which the agent gave you, you should be able to deduct the price of the property from the total price and this will tell you what the agent's commission is. It's worth bearing in mind that a lot of off-plan property is sold without the buyer being charged commission by the agent as the developer pays the agent a commission - so maybe you aren't even paying a commission to the agent? Why not ask the agent these questions and also look at your prelim contract again for the details of the price and VAT.

I'm not sure the agent "lied" to you and I don't think from what you say he has "added on" any costs: he probably expected that you knew the info from the prelim contract where the price and VAT would have been shown. Although, even having this contract, I do agree that a really good agent would have clarified the details with you, particularly if they knew you were taking a mortgage to buy the property.

I'm really sorry that you find yourself in this position but hope that the contact I found for you (and the others) can help find a resolution for you.

Hi Jain

Thanks for your replies and advice on this matter. I may be being naieve, but if I have interpreted this right, the valuation will be exclusive of VAT, F+F etc, which is what the bank works off. However, if we were to sell the property say a year down the line, then the price we sell for woudl be inclusive of these items? If so, surley it would be possible to re-finance further down the line to redress the balance. Am I over simplyfying this, or are we making a mountain out of a molehill?

 

[mickthepropertyguru]

Agents fee

HI Jain

Is there any way that people can obtain figures for what agents' fees are on each property as I've also been told that this figure is also taken away from the purchase price? I'm not blaming the banks or how they operate but |I do think that it is irresponsible of the agent not to mention these extra costs. basically I'm paying in cash for the agents fee without knowing what it is or having agreed to it. This is not the same as in the UK.

Ya it is unfair but really there isn't a way you can find out. The Deposit and the 30% go to the developer. The developer at a later dates gives commission to the property company. You could alway ask them but usually they may make a joke about it or tell you a lie. Its rare a rep will tel you the truth about this aspect. Sometimes the reps don't know either.

Well you can expect for a off plan development the agent is getting between 15% and 20 % in the emerging markets.
The big companies that host the most exhibitions around UK and Ireland have a lot of leverage because they get people to go on inspection trips, 100's per month. The Developer that give them the highest commission will get preferential treatment as the agent on the ground will also receive a higher cut when they sell.
Big companies get 15% - 20% of the sale price, the rep that you meet at an exhibition will usually get 6% of this and the Sales Rep you meet out in Bulgaria or else where usually gets 12% as well.
In Brazil the commission to big companies is up to 30%.
In France and Spain is between 10% and 15%.
There is always a lower commission on resale properties (built properties). This is why you may be finding it difficult to sell a property after complication, because the property companies would prefer investors to always buy off plan as they get more out of it and it easier to sell 200 units under than one roof than onces completed in different developments.
The development you bought in was 15%- 20% to the property company.

 

[Topcat1961]

Hi Jain

Thanks for your replies and advice on this matter. I may be being naieve, but if I have interpreted this right, the valuation will be exclusive of VAT, F+F etc, which is what the bank works off. However, if we were to sell the property say a year down the line, then the price we sell for woudl be inclusive of these items? If so, surley it would be possible to re-finance further down the line to redress the balance. Am I over simplyfying this, or are we making a mountain out of a molehill?

Dear Jain and Chris

When I first went to Bansko to view property my main intention was to buy a property outright, I had just sold my house in the UK and I wanted a little investment for the future. The Agents talked me out of this as they suggested I should invest only a little of my capital and purchase a mortgage, this was the way to be a property investor. I explained that I was self-employed and had been travelling for the last 2 years and had no real proof of income but both the agents and their financial partners, explained this would not be a problem in Bulgaria. They scibbled lengthy bits of paper with all financial workings based on a mortgage valued at the purchase price. The papers do exclude the lawyer's fee and stamp duty (3.1%). All their financial workings include the price (with VAT) as a basis for a mortgage. They even assumed a 10% growth on the price and then calculated a 75% LTV mortgage on the new increased value-not onece was it mentioned that the VAT would have to be paid separately-also as this property has a 6.5%rental guarantee, they even calculated this on the increased 10% purchase price.

Since coming back I have found that I don't qualify for a mortgage (in fact the self certificate mortgage is practically non-existant at the moment and has been for some time and I should never have been advised of this fact.

I only went to Bansko in February 2008, so all this was completely innacurate
information to get me to sign the reservation paper. I consider this to be completely unethical and dishonest.

When you take the VAT away from the purchase price, I am left with a sum that includes the furniture, kitchen, bathroom etc (I was not given an option of buying it without this and I do not have a clue as to what I have been charged as I was just told the price was inclusive and that my morgage would be based on this. When you deduct the VAT from the purchase price the cost per square metre is 1,320 (including furniture),which is really high and the banks are not valuing the property at that price. In short I am going to have to find the VAT of 15,111 euros plus the shortfall of the valuation and end up getting a 90% mortgage when I thought I had put a 30% deposit down.

This will end up being about 25,000 euros which I hadn't planned for and to make it worse I bought another property in Perun Lodge which I fear will be the same or maybe worse. Naive, I know, but I have been misled and have all these 'workings' on a paper, the agent must have known that all this information was innacurate and impossible for me to achieve and they have now put me into a difficult financial position with trying to raise extra funds just to complete the purchases without losing my investment so far. This is intent to mislead a consumer and they have not replied or acknowledged any correspondence for me to find out this information about costs so far.

I feel humilated for being 'taken in' so easily and believe me I am not a pushover but this whole experience has just reduced me to despair.
If there is anyone who has any advice I'd be most grateful.

 

[JOHNNY]

Perun Lodge

Topcat the same has happened to me re working out figures on a page all including vat and capital appreciation completely mislead and now the agents dont even answer calls, i need out and as much of my money back as possible, i would sell my contract for a loss, this should not be allowed to happened these agents should be identified and pushed out but it seems to be the done thing. Any advice i do not intend to mortgage and take out other finance to make up total price a complete joke against ordinary people

 

[Lysos]

Topcat & Johnny - take legal advice in UK. The company I presume you are referring to have their head office here, so must have some liability. There agents are renowned for telling you whatever you want to hear to get your signature. You will need evidence, of course, but try the BBC's 'Watchdog'.

 

[mickthepropertyguru]

Topcat & Johnny - take legal advice in UK. The company I presume you are referring to have their head office here, so must have some liability. There agents are renowned for telling you whatever you want to hear to get your signature. You will need evidence, of course, but try the BBC's 'Watchdog'.

Hello everybody, the company that people may be referring to has their head office in Spain. There is a reason why they are based in Spain as UK and Irish laws don't apply.
I'm going to say this again and more than likely get into trouble

Guys do you realize how many of ye have been mislead. There are thousands of you, thousands. To clarify i mean been told that you can get a 70% mortgage even worse 75% LTV mortgage and in the end you cant and if you can its 20% under value.
You need to get together (group on line) and form a team.
Than you can get legal advise and if there are hundreds of ye that the legal cost would be minimal.
This is the only way forward. The BBc's watch dog would be a good avenue as i don't think some paticular Property companies have managed to sue them yet

 

[Jain and Chris]

Hi all

Getting legal advice is probably the best thing right now. I think Mick has a good idea when he says get together and forming a working group. You can pm each other off this site and get each other's emails then see if you can find more people to join in. The group can then hire a lawyer to act for you all.

Those who want to continue to buy the property, contact the person I gave you as he believes he can help on the mortgage front.

Meanwhile it is very tricky posting names on a forum. A forum is treated as if what you are saying were in print. This can lead not only to claims of slander but is most likely to lead to claims of defamation. Defamation is the one area of law where innocent until guilty does not apply. If a forum (and usually the forum owner) were taken to court for defamation, they would have to prove what was said were true (not the agent having to prove what was said as false). You can imagine this would present huge difficulties to a forum. Defamation cases are most often won by the complainant. Unfortunately, there has been much abuse of free speech on the internet, especially on forums, so it is not surprising there are these cases. Therefore it is the most sensible thing for a forum not to allow names in posts of this nature.

Hoping you all get this sorted out.

Best wishes