Deposit Power collapse imperils smooth property settlements

Deposit Power collapse imperils smooth property settlements
Deposit Power collapse imperils smooth property settlements

Liquidators are warning property buyers caught in the collapse of Deposit Power that there is no update yet on their deposit bond guarantees.

"It appears that, at this point in time, the interim liquidators cannot advise the timeframe in which claims will be paid or the dollar value that will be paid," stakeholders were told by the interim administrator.

Deposit Power, which provided interim finance to property buyers, went into liquidation on February 23.
 
Deposit Power offered deposit guarantee bond products, assisting Australian borrowers and investors to buy residential and commercial properties without the need to provide a cash deposit.

The Administrators have urge all stakeholders, including property purchasers who have purchased deposit guarantee bonds to seek independent legal advice as to their rights generally. 

It means deals potentially coming undone if vendors are unwilling to wait for buyers to find alternative finance, according to mortgage brokers.

Existing deposit guarantee bonds cannot be amended because Deposit Power's parent, CBL Insurance, is in interim liquidation after the parent company into interim liquidation.

Gavin Moss, is the interim administrator of Deposit Power, which closed after the collapse of New Zealand's CBL Insurance.

Bids for Deposit Power were being made on this month.
 
An estimated 4000 local residential, commercial and property investors - down from the initial 10,000 in the initial Australian Financial Review report - have an estimated $200 million of deposits unresolved now for more than a month after the bond issuer and guarantor was placed in interim liquidation.
 
Deposit Power had links with most of the major property broker networks and major banks through their broker networks.

Deposit Power was on the product panel of most of the leading mortgage brokerages and aggregators, including Mortgage Choice.

 

Tags: 
Loan Deposit Home Deposit

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