Thursday, August 13, 1998 Published at 18:53 GMT 19:53 UK
Business: Your Money
Lender launches gazumping insurance
Home hunters often end up out of pocket because of gazumping
Homebuyers in England and Wales may soon enjoy protection against being gazumped.
Lambeth Building Society has announced a trial of insurance for home buyers that will cover against gazumping and other unexpected problems after purchase.
The purchase insurance will cover buyers who are left out of pocket after gazumping - losing a property to a higher bidder after agreeing terms with the seller.
It will also cover events including the discovery of faults in the building after purchase and post-sale property valuations that come in more than 5% below the purchase price.
Although only initially offered to Lambeth customers on a trial basis for £30, there are predictions the purchase cover will soon find a wider market through insurers.
A mortgage specialist, Patrick Bunton, senior manager at Chase De Vere Investments told BBC Radio 5 Live the policy is cheap and is likely prove popular.
He said: "I think it will probably become much more common. I think many lenders and insurers will now be looking at this as a contract they can offer."
Mr Bunton said the policy could well find acceptance among English and Welsh home buyers who enjoy little legislative protection from gazumping, unlike under Scottish law.
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