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Sipps and mortar

I was very surprised to see the statement that only three full Sipps offer

the facility for a mortgage to be taken out under a Sipp for investment in

commercial property in the Financial Product Reference in the May 24

edition of Money Marketing.

Certainly, our own Sipp – the Wolanski & Co personal pension plan – offers

this facility. And I think you will find that most, if not all, full Sipps

also offer this facility.

While some Sipps may package a mortgage facility as part of their

offering, most offer a completely untied facility, opening the Sipp to all

potential lenders, not just the one chosen by the “bundled” packages.

However, where you will find real differences is in the flexibility to

accommodate non-standard property transactions.

We have found, for example, that some of the very large Sipp providers

will simply turn down anything but the most straightforward property

transactions on the grounds that this is not permitted under guidelines.

The implication is that the guidelines in question are the Inland Revenue&#39s

whereas, in fact, the guidelines are their own.

In our own Sipp, we have successfully completed several property

transactions, covering joint ownership and/or overseas purchases, which

have been turned down by other Sipp providers. It is, of course, extremely

difficult to find out in advance exactly how flexible a particular Sipp

provider is in relation to property transactions but it is important for

IFAs to be aware that there are real and significant differences in this

area.

Elaine Bancroft

Wolanski & Co Trustees, London

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