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Building Regulations!!! Indemnity Policy!!
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# 1
rdx0202
Old 03-05-2007, 5:27 PM
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Unhappy Building Regulations!!! Indemnity Policy!!

After a long chase, we finally decided for a house that is currently occupied by the owner who had bought the house 3 years ago. The house has wall between the kitchen and dining room being removed. We are going for mortgage for thsi house and went for a basic survey. The survey report though pointed out that the wall has been removed without any approvals or permission but the surveyor suggested that if we create a beam to support, it will suffice. The mortgage has been approved, but our solicitor has pointed this out as a concern and asked the seller for documentation. The seller does not have this and hence proposed to take up an indemnity policy.

We have plans of removing the wall upstairs between the bathroom and WC after we move in. But I read elsewhere in forums that if a development is done in the house then the indemnity policy is void. What is the method to get this legally approved? How much is the charge involved? Can someone please guide me? Will contacting Council to check if there was any building approval or planning application applied for that house be a good step? We need to make decisions soon and as this is our first buy I do not wish to end up in a bad deal. Please help!!!
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# 2
silvercar
Old 03-05-2007, 10:28 PM
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Once you contact the council you won't be able to take out an indemnity policy, so that would be a bad move!

If the survey pointed out that there was no support, presumably this is a safety issue and needs addressing. The indemnity policy covers you for the council happening on this piece of work and ordering you to undo, it does not cover you for repairing shoddy work. If the survey just quesried whether building regs had been certificated for the work then you could take out an indemnity policy for peace of mind.

The logical thing to do would be to forget the policies and do both pieces of work at the same time then get it all certificated. If you don't intend doing any work in the very near future then you may want an indemnity policy, though personally I don't think they are worth the paper they are written on.

I would ask the surveyor about whether the wall needs supporting. Don't feel shy about doing this, you paid for a report and are entitled to ask questions.

Then ask your solicitor of the implications of not getting an indemnity, if he suggests its worthwhile then the sellers should pay for it; though they could refuse.
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# 3
coco123
Old 09-05-2007, 10:04 PM
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Unhappy I am niave - loft conversion

Hello,

I am in the process of buying my first house it's a 2 bed terrace with a lovely loft conversion. When we made the offer we new the loft conversion did not have building regs but we assumed this was for things like fire escape doors etc. The loft conversion is beautiful, used as a bedroom and is a key selling point of the house.

We had our homebuyers survey done and there didn't appear to be any wrong. I passed the survey to my solicitor and assumed (stupidly) that he would resolve things.

One of the comments refered to the floor of the loft conversion and said it cannot be assumed that the floor strengthing was complied with buidling regs. He requested whether the vedor had buiding reg certificate for this and they did not. He is therefore requesting imdemnity insurance. However, if I am right in thinking this only covers us for legal matters, in no way does it protect us against structual damage to the house if the loft is not of adequte quality (i.e. strength of floors etc).

I am therefore thinking of having a structural engineer check that the loft is ok and as it is to be occupied on a daily basis, whether it is strong enough for this. However this will cost and extra £500

Has anyone lese had this problems? how did you resolve it? We are really stretching ourslevs and so am very reluctant to take risks.

Sorry about the waffle! I hope it makes sense.
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# 4
Richard Webster
Old 10-05-2007, 8:53 AM
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Quote:
However, if I am right in thinking this only covers us for legal matters, in no way does it protect us against structual damage to the house if the loft is not of adequte quality (i.e. strength of floors etc).
That's right - it will only cover the consequences of enforcement action by the Council e.g. costs of defence and reinstatement to previous condition or loss of vlaue because reinstatement is required. Will not cover you if loss results from e.g floors not being strong enough.

You have to balance being careful and having expert input to check the position (which could cost as you say and might not be welcolmed by the seller because it could be disruptive) on the one hand, and on the other the fact that there are many properties built years ago whose construction methods would not comply with modern regulations but don't break the regulations because of their age. Nobody seems to bother much about them, e.g a lot of houses in Northern Towns have a steep bendy staircase to an attic room that has been there since the year dot and would no way comply with modern regs for loft conversions.

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients.
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# 5
coco123
Old 11-05-2007, 12:48 PM
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Thanks Richard Webster.

I see you are a conveyancing solicitor - can I ask...if you were in this situation with a client would you have said to them "we can sort the legal bits with indemnity insurance but you need to decide on whether this matter needs to be investigated further for structural reasons?"

It's just that I am not impressed with my solicitor - he's not once said to me 'this is the situation ......'. I keep having to call him. He also ingnores emails even when I write things like " please confirm reciept of this email"! Is this normal? Am i expecting too much?
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# 6
rdx0202
Old 11-05-2007, 12:54 PM
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Well my solicitor said that earlier while discussing the searches that we can go for indemnity insurance (as a new buyer, it seemed to be the best thing) but he slightly also mentioned that if you wish get the house surveyed by a builder. We thought that we are getting the best advice and asked what normally people do and indemnity was suggested. Now we are nearing the exchange, and he wants this in writing from us that we are happy with the indemnity insurance... I'm tired!!!
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# 7
Richard Webster
Old 11-05-2007, 2:42 PM
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I see you are a conveyancing solicitor - can I ask...if you were in this situation with a client would you have said to them "we can sort the legal bits with indemnity insurance but you need to decide on whether this matter needs to be investigated further for structural reasons?"
I deal with this sort of thing by providing a written report with the contract when it is ready to sign and there is a two page note that I send out explaining lots of stuff about building regs and FENSA certificates etc if the point is relevant to that client' s purchase.

The note ends up:

"What cover do Building Regulation Indemnity Policies give?

The policy will pay out if enforcement action is taken by the Council and would cover defending the case and the cost of undoing to work and reinstating to the former condition and any loss in value as a result. It does not pay out if there is damage to the property as a result of a breach of the regulations. For this reason it is very important to have a survey of the property and act on your surveyor’s advice about any issues relating to building work where compliance with the regulations is important."

Note the last sentence.

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients.
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# 8
seven-day-weekend
Old 11-05-2007, 3:58 PM
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Originally Posted by Richard Webster View Post
That's right - it will only cover the consequences of enforcement action by the Council e.g. costs of defence and reinstatement to previous condition or loss of vlaue because reinstatement is required. Will not cover you if loss results from e.g floors not being strong enough.

You have to balance being careful and having expert input to check the position (which could cost as you say and might not be welcolmed by the seller because it could be disruptive) on the one hand, and on the other the fact that there are many properties built years ago whose construction methods would not comply with modern regulations but don't break the regulations because of their age. Nobody seems to bother much about them, e.g a lot of houses in Northern Towns have a steep bendy staircase to an attic room that has been there since the year dot and would no way comply with modern regs for loft conversions.

As a conveyancing solicitor I believe the information given in the post to be useful but I accept no liability except to fee-paying clients.
My house in the Midlands has one of these; however we had a proper velux window put in the south-facing slope of the roof (there was already a little roof window in the north-facing roof) and we have also provided a dedicated fire-escape ladder (which reaches almost to the ground) and a smoke alarm, so that in the event of a fire, the occupant can escape.

Regardless of whether your loft conversion has to meet modern-day regulations, I would say these things are a minimum safety precaution - morally if not legally -if it is going to be used as a habitable room (ours is used as a bedroom).
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Last edited by seven-day-weekend; 11-05-2007 at 4:00 PM.
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# 9
coco123
Old 11-05-2007, 7:30 PM
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Seven-day-weekend - if all goes well we'll use the room as a bedroom. It's got smoke detectors and I was thinking of getting one of those metal chain ladder things to keep in the cupboard. But thanks for the concern.

Richard - thank you so much! I wish you were my solicitor. Any ideas on how i can get mine to be a bit more proactive - he ignored another email today.

Also, just one more question..... we're FTB and don't have a deposit. I asked (yes I had to ask) our solicitor on how we would exchange as we don't have a deposit. He said that we could exchange and complete on the same day or find a token deposit. I phoned Northern Rock to see whether there was another option and they said that it is possible to release funds early but we would have to waive the right to cancel on the unsecured loan bit. They were cagy about advising me to do this as they are not financial advisers and said that the solicitor would have to get in touch with them. I then spoke to my solicitor and he just fobbed me off saying that this wasn’t a good option – he didn’t really give a good reason why. Do you have an opinion on this? Why would it be a bad idea – it seemed a good option to me. Oh I wish I had a good solicitor!!!!!!
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# 10
FilthyLuka
Old 11-05-2007, 11:20 PM
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coco123 - when you buy the property in 5,10,15 or so years time you will encounter similar problems when you come to sell, particularly when Home Information Packs are needed. You may have trouble finding a buyer unless you find someone similar to yourself to accept the loft without certificates
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# 11
coco123
Old 12-05-2007, 10:18 AM
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Thanks FilthyLuka

Do you think an indemnity policy and a survey saying that the loft is structurally sound will be sufficient? Would this put people off from buying?

We’ll also get a roll out metal ladder thing for fire escape and make sure the smoke detectors are working.
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# 12
coco123
Old 13-05-2007, 11:12 AM
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Hello,

As you can imagine I have been thinking this through all weekend and have thought of another problem.....

If we get the survey done and it say's we need to strengthen the floor and will cost xxxx thousand. If we then get this money off the vendor to have the work done.

When the joiner comes in and removes all the floor boards and strengthens the floor joists – will he get the builing reg officer to come and issue a certificate for just the floor? But when the building reg guy comes in and sees that the rest of the loft is not to standard (i.e. fire escape) surely he can’t just ignore this? Will we then invalidate our indemnity insurance? Will he make us bring the loft up to building regs? Or is it possible to request that the certificate is just for the floor strength??

Advice would be greatly appreciated!! I am tearing my hair out with this one!!
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# 13
coco123
Old 14-05-2007, 1:32 PM
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Originally Posted by coco123 View Post
Seven-day-weekend - if all goes well we'll use the room as a bedroom. It's got smoke detectors and I was thinking of getting one of those metal chain ladder things to keep in the cupboard. But thanks for the concern.

Richard - thank you so much! I wish you were my solicitor. Any ideas on how i can get mine to be a bit more proactive - he ignored another email today.

Also, just one more question..... we're FTB and don't have a deposit. I asked (yes I had to ask) our solicitor on how we would exchange as we don't have a deposit. He said that we could exchange and complete on the same day or find a token deposit. I phoned Northern Rock to see whether there was another option and they said that it is possible to release funds early but we would have to waive the right to cancel on the unsecured loan bit. They were cagy about advising me to do this as they are not financial advisers and said that the solicitor would have to get in touch with them. I then spoke to my solicitor and he just fobbed me off saying that this wasn’t a good option – he didn’t really give a good reason why. Do you have an opinion on this? Why would it be a bad idea – it seemed a good option to me. Oh I wish I had a good solicitor!!!!!!

Hello, I have been in touch with the vedors this morning and I get the impression that our solicitor hasn't even told them about us not having a deposit!!! Anyone else considered releasing funds early from the lender? Surely we're not the first people in the world not to have a deposit - how did you get round it?
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# 14
sonia7860
Old 31-07-2010, 1:39 PM
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Default Indemnity Insurance

Dear all,

I need help. I am buying a house and my solicitor’s have asked me to take out indemnity insurance because the seller dont have building reg certificate for removing the wall between kitchen and dinner. The seller also converted the shed on side into utility room.

1) - I don’t mind taking out the insurance (obviously) at seller’s expense but I am thinking there is no point taking it out as I am looking to move kitchen into utility room and use kitchen/dinner as living space. So I get the entire work certificated at once. But not sure if I need to obtain building reg certificate for work done before then I can go ahead and do next bit or I can get done everything in once. Can some one explain to me how this works?

above is not something I am looking to do straight away so I am thinking at least it will cover me till I start the work and its not expensive.

2) - However my solicitor also suggested that I can insist the seller to get local authority in and obtain the certificate which will mean I can not take out insurance, if they do.

So I am stuck. I am also thinking I insist that they get local authority in and try to obtain the certificate if they get some one in and the certificate is not obtained and there are remedy work required at least I know what I am getting myself into.

Or just make the process easier for seller and tell them to get me insurance and compensate me as price reduction for risk I am taking.

Can some one please advice me? I am 1st time buyer.

All this thinking is making my head hurt. I am so close to exchange. It will be shame that I will lose out on all the money I paid out for mortgage fees and etc.

Last edited by sonia7860; 31-07-2010 at 1:59 PM.
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