What a deposit release bond means for the buyer

How the bond interacts with the deposit

Without a bond, the purchaser's deposit is usually held by a solicitor until completion. With a deposit release bond in place, the sale contract provides for the deposit to be released to the developer, and the bond protects the purchaser in its place. Released money must be spent on the development.

Buyer protection

The bond is issued by a specialist insurer for the benefit of the purchasers. Cover typically responds where the developer cannot complete the home, for example through insolvency or abandonment of the scheme, and the purchaser can claim their deposit under the bond. The bond wording is the definitive statement of what is covered, and we can provide it for any scheme we arrange.

The purchaser certificate

Each purchaser whose deposit is released receives a certificate confirming their deposit is covered by the bond. On a claim, it is the purchaser who is paid.

What we can provide on a scheme

• Confirmation that a bond is in force for the development and the plots it covers
• The name of the insurer issuing the bond
• The bond wording
• The certificate for a specific plot and purchaser
• The release conditions agreed with the insurer, so the sale contract can reflect them

We verify that you act for the purchaser or the developer before we share anything about a specific scheme, plot or purchaser.

Acting for the developer

If the bond is arranged before sales launch, the release provisions can go into the sale contracts from the start. On a live scheme, we will share the insurer's requirements so you can see what, if anything, needs to change for plots that have already exchanged.