They are selling their house for £105,000 and moving into property with a purchase price of £140,000. You will appreciate that with joint income of £28,000 they are not cash rich. However, getting to the point, they have instructed solicitors to act for them and have had to pay a deposit for their fees of £350. They have had to send a fee to the mortgage company of £650 being the set up fee and valuation fee. These two fees alone amount to approx £1,000. In 2007 they will need to have had a HIP completed and I would estimate this to be about £1,000. Therefore before anything happens they have to find this £2,000. If all falls through, I ask who will compensate them for this cost? On completion they will have to pay a further £2,500 to the estate agent, £14,000 stamp duty and a further £1,000 solicitors fees. As they are excellent clients of mine, I have assisted where I can, however I put this scenario to them and asked how they would go about moving if they were to have to find the extra monies. They immediately expressed the fact they would not move. Where are we going? The idea of HIPs, in my opinion, is just another tax for Gordon.
Terry Keen
Via e-mail
