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  • FIRST POST
    • izoomzoom
    • By izoomzoom 13th Jul 17, 10:43 AM
    • 1,416Posts
    • 1,980Thanks
    izoomzoom
    Sodding Housing Association / Shared Ownership
    • #1
    • 13th Jul 17, 10:43 AM
    Sodding Housing Association / Shared Ownership 13th Jul 17 at 10:43 AM
    We bought 50% of our SO house 10 years ago, and want to do an extension.

    As per the terms of our Lease, we duly sought the HA permission. After waiting and waiting, I started to chase them.

    And they came back and said no, because the Lease said "Not to make any alterations or additions to the exterior of the Premises ..."

    Bloody sods didn't bother to finish the rest of the clause, which basically said "... without the previous written consent to the Landlord such consent not to be unreasonable withheld".

    Anyway, I asked them if their copy of the Lease was missing key information and they came back saying they do give permission, subject to a number of things, which include the builder having insurance, certificates for the electrics etc, which I understand and are completely reasonable.

    However, they've said that we cannot borrow money for the extension. I can almost understand them not wanting us to borrow money that is secured against the property (although they obviously allowed us to do this when we took our the mortgage), but the letter actually says "Please can you confirm that you have the money to pay for this and are not borrowing in anyway".

    I will obviously be very polite in my reply (asking them to point out relevant clause in Lease) but the f***ing cheek of them

    For the record, we are borrowing money for the extension, but it will be an unsecured loan.
    LBM Nov 08 CC debt 6450.

    As at Jul 2010: £ 4280 (PO 2087, Barc 890, HSBC 1303)
    As at Jul 2011: £ 3180 (PO 300. Barc 2780)
    As at Dec 2012 £ 4460 (PO 2600, Barc 1760, HSBC 100)
Page 1
    • ProDave
    • By ProDave 13th Jul 17, 10:56 AM
    • 201 Posts
    • 261 Thanks
    ProDave
    • #2
    • 13th Jul 17, 10:56 AM
    • #2
    • 13th Jul 17, 10:56 AM
    Well I would bloody well hope the builder has insurance, and if the electrics don't have a certificate you won't get a building regs completion certificate, so those are all "normal" requirements.

    But how does it work with shared ownership? YOU pay for the exctension, do the HA then magically own half of it, even though they have not paid for it? after all it says they own half the property. Then later you decide you want to buy the remaining half, Do they then try and charge you more because it was extended? What if you choose to sell it to someone else wanting to buy a half share? Does the new buyer own half of the whole lot, or half the original house plus the whole extension?

    Those are the questions I would want definitive answers to before pouring a lot of money into something you own half of. If you are not careful you might just be giving away half of what you spend to the HA.
    • DaftyDuck
    • By DaftyDuck 13th Jul 17, 11:01 AM
    • 3,665 Posts
    • 7,354 Thanks
    DaftyDuck
    • #3
    • 13th Jul 17, 11:01 AM
    • #3
    • 13th Jul 17, 11:01 AM
    but it will be an unsecured loan
    That's the bit that is relevant to them. If it was secured against the property, there's a chance the 50% ownership they retain would be at risk.

    Intrusive, yes I agree. However, there is a point in their question to protect their interests. A poor point nonetheless.
    • IAmWales
    • By IAmWales 13th Jul 17, 11:06 AM
    • 990 Posts
    • 2,150 Thanks
    IAmWales
    • #4
    • 13th Jul 17, 11:06 AM
    • #4
    • 13th Jul 17, 11:06 AM
    Well I would bloody well hope the builder has insurance, and if the electrics don't have a certificate you won't get a building regs completion certificate, so those are all "normal" requirements.

    But how does it work with shared ownership? YOU pay for the exctension, do the HA then magically own half of it, even though they have not paid for it? after all it says they own half the property. Then later you decide you want to buy the remaining half, Do they then try and charge you more because it was extended? What if you choose to sell it to someone else wanting to buy a half share? Does the new buyer own half of the whole lot, or half the original house plus the whole extension?

    Those are the questions I would want definitive answers to before pouring a lot of money into something you own half of. If you are not careful you might just be giving away half of what you spend to the HA.
    Originally posted by ProDave
    Any material improvements would usually be excluded from the 50% valuation. OP can confirm this with the HA.

    izoom, I expect the clause about not borrowing further is primarily about secured lending, but also to ensure you're not overstretching yourself - the HA would be irresponsible to permit something that would result in you being unable to pay your rent/ mortgage. Have a chat with them about the reasoning behind the clause, and assuming it will not put you in difficulty (now or in the future, ensure you have adequate insurance for job loss, sickness etc) I can't see it being a problem.

    I've just seen your other thread, are you still wanting to convert the garage? If so that is changing the material feature of a part that the HA has an interest in and makes it far more complicated regarding future valuation.
    Last edited by IAmWales; 13-07-2017 at 11:09 AM.
    • ££sc££
    • By ££sc££ 15th Jul 17, 7:26 PM
    • 236 Posts
    • 120 Thanks
    ££sc££
    • #5
    • 15th Jul 17, 7:26 PM
    • #5
    • 15th Jul 17, 7:26 PM
    "the Lease said "Not to make any alterations or additions to the exterior of the Premises ..."

    Bloody sods didn't bother to finish the rest of the clause, which basically said "... without the previous written consent to the Landlord such consent not to be unreasonable withheld".

    I disagree the HCA model lease that HAs generally use says the same as yours (that you singed), there's been different editions but here's an example.....
    10.9 Not to alter
    10.9.1 Not to:
    (a) make any alterations or additions to the exterior of the Premises;
    (b) make any structural alterations or structural additions to the Premises;
    (c) erect any new buildings on the Premises; or
    (d) remove any of the Landlord’s fixtures from the Premises.
    10.9.2 Not to make any alteration or addition of a non-structural nature to the interior of the Premises without the previous written consent of the Landlord (such consent not to be unreasonably withheld).,

    In terms of them asking about your funding, most shared owners that carry out costly works to their home try to finance it by extending their mortgage, which they can't do. why? Housing associations pretty much guarantee the mortgage via the Mortgagee Protection Clause, they'll do so for the mortgage you use to buy the property, for any advances for essential maintenance and for staircasing. They won't consent to a secured loan/ further advance on the mortgage for items such as non - essential works such as extensions, holidays, debt consolidation etc. Why? because if the lender repossess the HA will end up footing the bill for these elements too. We often get requests for approval for remortgages, and I explain this. The financial advisor will often tell the customer it's fine, the lender doesn't need this protection. It'll get down the road of the lender's lawyers who will grind the whole thing to a halt. no further loan and customer loses money in arrangement fees/valution fees. Is it any business of your HA how you'll be financing this extension? probably not and they could have explained it a bit but I def wouldn't say they have a "f***ing cheek". By asking you the question, if you were thinking of taking a further advance on your mortgage they may have just saved you a load of time and whack of dough.
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