Clarity on Cladding
Great news that, as of 9th January 2023, some lenders have changed their policies relating to cladding!
Following an industry statement released in 2022, mortgage lenders have begun to update their cladding criteria, giving leaseholders and potential purchasers alike more clarity, and importantly, more options.
Back in July 2022, an industry statement was released, focusing on and outlining the function of the new Building Safety Act 2022. The act was introduced to encourage the market regarding cladding and other safety aspects. This statement was then followed by guidance from the Royal Institution of Chartered Surveyors (RICS), outlining the valuation approach for residential property with cladding.
Now having entered the new year, three major lenders are starting to release their updated approaches to cladding, and we have taken the liberty of outlining a few examples below.
*Please note, these changes related to main residential homes, and does not necessarily represent lending policies for second homes or buy-to-let properties.
When an EWS1 form is requested and confirms that a property does not meet minimum safety standards, or is unavailable, lending may still be considered providing there is a completed Leaseholder Deed of Certificate confirming the leaseholder is protected by the leaseholder protections of the Building Safety Act 2022. Confirmation may also be required on any customer liabilities relating to proposed works and related start dates for this.
For flats with cladding systems rated A3 or B2, in England only, lending will be based on a new, after repairs figure, as confirmed by a valuer.
Where there is a qualifying lease or planned remediation in place from a recognised body, Barclays will be able to consider lending on properties with unsafe cladding. Certificates and confirmations relating to the Building Safety Act of 2022 will be required.
In summary, it’s fantastic that a new approach to cladding has made its way to the market which will potentially help thousands who may have had difficulty purchasing, selling, or homeowners who have been stuck with a mortgage, unable to shop around for more competitive options.
This is a fluid situation and more lenders will be expected to follow suite. Make sure you speak to on of our mortgage advisers who will be fully up to date with the changes and will be able to navigate the market for you.
Contact one of our advisers today on:
?0808 231 1073
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.