Suffolk Like is targeting property investors dissatisfied with their current SIPP provider, with a new offer which will see fees cut and a contribution to the legal costs.
If the level of service provided to investors and advisers falls below an acceptable level, the obvious next step is to consider moving to an alternative SIPP (Self-Invested Personal Pension) provider. But, the costs of doing so can be prohibitively expensive, particularly where the SIPP owns a commercial property.
For property investors, not only will they have to pay exit fees to their current SIPP provider, but also new set-up fees, legal costs and possibly bank charges if there is loan outstanding.
The new offer from Suffolk Life will help to reduce the cost of in-specie property transfers and includes:
- Waiving of the fee on the Suffolk Life Master SIPP, normally charged at £300
- A 50% reduction of the property acquisition fee, from £1,450 down to £750
- Waiving of all cash transfer in fees
- If their choice of solicitor is used, Suffolk Life will meet the legal costs
The overall cost saving, compared to Suffolk Life’s normal fees, will be at least £1,400 per property.
High exit fee warning
Commenting on the initiative, which will be run on a trial basis to the end of June, Dominic Savage, Suffolk Life’s Property Director said: “In specie SIPP property transfers are infrequent, doubtless due to fear of high cost. However, having recently transferred in excess of 500 commercial properties in specie through our SIPP acquisition strategy, combined with putting in place a highly effective panel of solicitors, has meant that we’re able to manage the process smoothly and efficiently at a lower cost.”
The move from Suffolk Life comes at a time when the exit fees charged by some SIPP providers are coming under increasing scrutiny.
“Greg Kingston, Head of Marketing & Proposition for Suffolk Life, said: “High exit fees are putting off advisers from recommending a change of provider, and SIPP property investors often baulk at the cost of making the change, even from a provider who’s no longer providing the service they need.”
Kingston continued, “Controlling overly-high exit fees is a matter for the regulator rather than us, but we can help by reducing our own costs as much as possible to lower the overall cost of a transfer.”