Bank of England resolves payments issue that threatened home sales
Homebuyers and sellers faced an anxious wait for funds to clear on property transactions today due to issues hitting the Bank's CHAPS service.
A global payments glitch that could have threatened property purchases and sales has been resolved.
The Bank of England warned earlier today that a global payments issue affecting its CHAPS (Clearing House Automated Payments System) service could impact buyers and sellers completing on property transactions.
It said the issues was delaying some "high value and time-sensitive payments, including some house purchases."
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It is unclear what caused the issue but the Bank now says the third party supplier has restored service and CHAPS payments are settling as normal.
The Bank says: "We expect that all payments received by the Bank today will be settled by the end of the day.
"If you are concerned about a CHAPS payment you plan to make or receive today, please contact your bank, or other payment service provider."
How will payment delays hit the property market?
The CHAPS system is used by mortgage lenders and the legal industry to transfer funds. Estate agents, conveyancers, buyers and sellers will be waiting for money to clear before a deal can complete and keys can be handed over.
Friday is typically one of the busiest days for moving home so there could have been issues if the delays had run into tomorrow.
Toby Leek, president of estate agent trade body Propertymark, warns payment issues can leave buyers waiting outside their new property with a removal van full of their belongings in very extreme cases.
“Completing on a property can be extremely stressful even without technical issues," he says.
"However it is important to remember that should systems ever cause unexpected problems at a vital moment within the transactional process, these issues do tend to be fixed quickly."
Simon Bridgland, director at advisory firm Release Freedom, suggests it is best to keep calm in these situations as there is nothing borrowers can really do about the delay.
"Conveyancing firms would have usually already arranged for funds to be sent across to them in advance, so short-term CHAPS issues, in the main, should not delay completions," he says.
"But tell that to the poor sole at the top of a chain waiting on their cash."
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