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Platform - proof of funds vitally important as stamp duty holiday end nears

Being able to show proof of funds in a quick, transparent and simple way is more crucial than ever to keep fall-throughs to a minimum as the end of the stamp duty holiday is reached.

That’s according to compliance platform Checkboard, which is designed to carry out property background checks in only 15 minutes and argues that knowing for sure that buyers have the funds they say they do is of vital importance in keeping transactions on track and preventing the collapse of house sales as another stamp duty surge occurs. 

“If agents can easily assess, in a near-instant fashion, whether buyers have the necessary funds to bankroll their purchase, it stands to reason that fall-throughs will reduce and other issues will be kept to a minimum,” James Owusu, founder of Checkboard and a former private banker, said. 

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“Although the stamp duty holiday end has already been largely baked into the market, it’s widely expected that there will be another stamp duty surge before the end of September deadline, which will keep agents, surveyors, conveyancers, lenders and removal firms very busy. 

“Anything that can be done to speed up the process, take away the pressure from those involved in transactions and ensure full transparency and accuracy throughout, will surely be welcomed as everyone is likely to be run off their feet towards the end of the month.” 

The final deadline for the stamp duty holiday is September 30, after which the temporary tax exemption will finally come to an end. It was first introduced by Chancellor Rishi Sunak in July 2020 and has been tapering off since June 2021, but has been widely credited with keeping demand and activity high in the housing market during the pandemic.

Checkboard claims the fact that tax savings are open to all kinds of purchasers – from investors and landlords to downsizers and second-steppers – could see a greater pool of people try to get transactions over the line before September 30.

“It’s also the case that many sellers will be both selling and buying as part of a chain – moving up or down the market depending on their age and circumstances – which means more scope for issues, fall-throughs and problems when it comes to proving funds,” Owusu continued. 

“To offer peace of mind in what will be an even more frenzied period than we’ve seen recently, agents should consider partnering with a provider who can offer peace of mind when it comes to proof of funds.”     

Owusu says an automated process can help agents to quickly establish proof of funds, rather than relying on time-consuming and manual traditional processes.

We now have the technology at our disposal to automate all those time-consuming, laborious manual tasks, meaning no more wasted time for all those involved in a property transaction,” he said. 

“In so many parts of life now, things are automated and instantaneous – and we don’t question it twice – but in the property world there are still processes being used that have barely changed since the 1980s. It’s completely illogical.” 

He added: “We all know how tedious buyer and seller checks can be, but with an automated system in place, this no longer needs to be the reality. It’s simple, faster, time-saving and cost-effective – a win-win-win-win in all respects.” 

Owusu insists funds can be checked quickly, safely and accurately thanks to the growth of Open Banking - which connects banks, third parties and technical providers, enabling them to simply and securely exchange data to their customers' benefit.

“Financial checks can now be done via an app in a matter of minutes, in an entirely secure and transparent fashion. A tech provider like Checkboard, for example, can securely connect to a buyer’s bank through open banking, negating the need for them to supply bank statements to the other parties in their property transaction, saving a whole heap of time,” Owusu claimed. 

“All the agent needs to do is send them a magic link which takes the user to the Checkboard app to start their verification. Once all the checks are completed, including basic information, identity and financial checks, we securely share the results only with the relevant parties to your transaction – saving a lot of time and effort.” 

Owusu believes such speed and simplicity will be music to the ears of agents dealing with an increased workload as the end of the stamp duty holiday nears.

“Agents will clearly be able to see a buyer’s account with NatWest, for example, and whether they have the funds they insist they do. Rather than it getting to a later stage and it becoming clear that the buyer doesn’t in fact have the necessary funds, this problem is nipped in the bud early.” 

The Checkboard app is available from the App Store and Play Store. You can find out more about what it offers here.  

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