Mortgage lending to resume on properties requiring cladding remediation
Thursday 26 January, 2023
It has been announced that the six biggest UK mortgage lenders have said that, at the beginning of this year, they will again agree to provide mortgages on high rise properties. Even those that still require the cladding remediation work will have access to mortgage lending. However, this only applies to those that are able to show evidence of self-remediation, that there is cover in the form of government schemes or there are protections from the Building Safety Act.
Farrukh Jabbar, our Mortgage Broker in Walthamstow, East London has been looking at the statement and the details that have been released.
What are the changes to mortgage lending on flats?
Lenders had continued to offer mortgages to potential purchasers for flats that did not require any work to rectify cladding. However, there have been obstacles in place for those looking to mortgage or remortgage flats where cladding remediation work was required.
The RICS updated its advice at the end of last year. Since then, the government has subsequently created remediation funding schemes along with putting in place legal contracts with the builders and developers to help cover part of the remediation costs.
This change in advice means that UK mortgage lenders are now able to assess mortgage applications for properties in high rise building across England that are 11 metres and over high and that have been impacted by cladding issues.
Who are the big six mortgage lenders?
The six biggest lenders that have pledged to resume their mortgage lending to these borrowers are:
- Barclays
- HSBC
- Lloyds Banking Group
- Nationwide Building Society
- NatWest
- Santander
However, Lloyds Banking Group have also said that an EWSI form would no longer be required to progress their mortgage applications on properties in England that are five stories or higher.
Farrukh Jabbar, Mortgage Broker & Protection Adviser in Walthamstow, East London said:
“It has been known that mortgage lenders have continued to lend on flats, without the need of a completed EWS1 form. However, that was often not the case for properties within a medium and high-rise building in England with building safety concerns. This announcement is a good step forward to help the mortgage lending process to restart.”
Farrukh continued “The updated guidance and policies mean that UK Mortgage providers can help to keep the market moving by supporting a wider range of mortgages to buyers looking to purchase a flat or existing owners looking to re-mortgage their properties that have been affected by the safety concerns”.
How to get a mortgage on a flat with cladding
This area of mortgage lending still has its complexities, so if you are looking for a first time buyer mortgage or would like to remortgage on a block of flats with cladding, then please give Thomas Oliver a call on 01707 872000. Our specialist mortgage brokers can help and support you throughout your mortgage application.
