how to derisk myself from builder going bust

H

hema1

Registered User
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I am buying an off-plan apartment in midlands at €25000/- DISCOUNT to fair market value. The unit will be finished in OCT/NOV. There was alsoa 4 year rental gurantee by builder( i factored that into price). when i told this to a friend , i was asked what if builder goes bankrupt by OCT/NOV and what if Builder goes bankrupt in next 4 years ?
so can any experienced investor please help me as to how can i de-rsik my self from such a situation, should i ask my solicitor to advise builder take indeminity insurance or any such arrangement and how such things work?

Thanks for help

Rgds
Hema
 
Thanks, I know.
Stampduty is based on Invoice value and as long as revenue is convinced that it is not a tax-evading practice buyer has nothing to worry. any way my question is as to get ideas to derisk from builder going bust on a rental guarantee scheme.
 
Hi,

I think the chances of you getting the builder to take out some form of insurance is slim to none! In practical terms I would say that is one of the many problems with "guaranteed" rentals-------- a guarantee is only as good as the person/company giving the guarantee. I dont think you will be able to "de-risk" yourself--that doesnt mean you wont get your rent,you might but you should make enquiries as to the basis on which the builder is basing his ability to make the guarantee--i.e is it a desperate ploy to offload properties that are now not selling or has he got some longterm contract lined up with solid tenantsE.g with some college or tourist entity...If the guarantee is based on something real the builder should be able to give you the real info.

Good luck with it anyway.
 
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