I have today been advised that the cost of selling a housecrowd share is £50 +vat. So i have 2 shares i wish to sell (1 share = £1000).
Does anyone think this is a bit excessive?
Hi Everyone
this forum post has been brought to my attention and so I thought I would explain why we now charge £50 (we used to do it for free but it was becoming far to burdensome as numbers increased)
I would stress (as some people have pointed out) that at every opportunity we say that investing with us should be regarded as a long term investment. It is clearly going to be disadvantageous to you if you wish to exit early and the costs disproportionate if you only have a small amount invested. By the way we only charge the fee for each separate buyer not each share transferred.
I have set out below a brief outline of what the process actually involves . With all the to-ing and fro-ing its normally around 2 hours work.
For the record you might also be interested to know that when we tried outsourcing this function to a local company secretarial company they quoted £125 plus VAT just for doing the paperwork for a transfer and that would not have included the work involved in finding a buyer. So to my mind £50 is more than reasonable when you appreciate the work involved. We certainly aren't making money from it - £50 just about covers costs.
Heres what needs to be done to transfer shares following the correct legal procedure
1. Create new Redemption folder in the HCP project folder.
2. There are templates for all emails, letters and docs referred to in this procedure. Remember to always save the docs to the Redemption folder with the project number and buyer/seller/recipient, e.g. Redemption Request Form HCP[030] [ xxxx]
3. Send first seller email responding to investor’s query. Attach:
a. redemption request form filled in
4. If they send RRF back, produce invoice for the admin fee. Save invoice in Redemption folder.
5. Save request form in redemption folder.
6. Send the second seller email. Attach the invoice for the admin fee.
7. When we receive the admin fee, start to contact investors to look for a buyer .
8. Enter details of proposed transfer on Redemption Register in Legal/Redemption of share transfers.
9. When we find a prospective buyer, send out first buyer email. Attach: information memorandum for that project.
10. When buyer confirms they want to buy, send out second buyer email. Attach:
a. transfer offer letter
b. incoming investor form .
11. Make sure the correct transfer offer letter template is used – one for no stamp duty payable if only £1,000 transfer, the other for stamp duty payable for more than £1,000 .
12. At the same time send the third seller email to the seller. Attach:
a. stock transfer form .
13. When we have received an electronic version of the incoming investor form, file it in the project Redemption folder.
14. When the seller has confirmed that they have received the money and we have received the stock transfer form, send the stock transfer form to the buyer with the covering letter. Save letter in Redemption folder.
15. Make sure the correct covering letter is used; stock transfer and stamp duty covering letter if more than one share transferring; stock transfer no stamp duty letter if only one share transferring.
16. When we receive the stock transfer form back, file the form and update the share register with new shareholder details. Include note on register of date of transfer (on stock transfer form) and transferring shareholder.
17. Send out by email new share certificate to buyer – use same certificate number but change shareholder name and address.
18. Update records at Companies House
This is not straightforward work and needs to be done by a competent legally trained person. Perhaps you will now understand why it is necessary to charge what we do.
Best wishes
Frazer
CEO The House Crowd