FTB - Subsidence Help

twig101

Hello everyone.

Really need some advice and help.

Background.

Myself and girlfriend have saved up for a few years now. Finally got ourselves a deposit and started looking at houses.
Found one that we both liked.
Put an offer in and after abit of two and fro the offer was finally accepted.
Home buyers survey done and came back ok.
Had a phone call from the solicitors last week asking if we were ok to come discuss the contracts and sign.
Meeting went ok apart from the solicitor has discovered some type of claim for subsidence on the property and informed us she is awaiting more information.
Letter came this morning infroming us that the property had a subsidence damage notice on the 20th January 1975 and was settled by a payment of £2,975 in 1977.

Been searching for home insurance to see what difference this makes.
Alot of insurers are turning us down or price is 3 or 4 times the amount we was expecting.
Been to speak to the sellers of the property who told us they know nothing of the claim and do not tell there insurers of the claim so they therefore just payed a normal price for the insurance.
Told us to do the same which I am not prepared to do.

Just wondering what everyone thinks?

At the minute we have come up with these options

1) Carry on with sale pay 3/4 times original insurance quote
2) Same as 1. but try to get a discount on the home to compensate.
3) Back out and lose money already payed out.

Any advice appreciated.

silvercar

Have you had a survey?

If so and there is no current sign of subsidence, then I wouldn't worry. If there has been no movement in 35 years, I doubt its still a problem.

twig101

Thanks for the quick reply.

Yes we have had a survey but we only had a home buyers survey as we wasnt aware of the subsidence.

That found no issues relating to the subsidence but this doesnt alter the fact i still need to notify the insurance company?

lincroft1710

Nearly £3K in 1977 was quite a lot of money in property terms, so it sounds like it was quite serious. If you make a false declaration either verbally or in writing to an insurance company they can refuse to pay out on any claim.

twig101

Thats exactly why i am being 100% honest with the insurance companies unlike the current occupier.

I've currently only spent £300 on the survey and £300 for solicitors search fees.
I have another £500 to pay the solicitor on completion but i believe if we do not complete they would demand this anyway?

satchmeister

twig101 wrote: »

Thanks for the quick reply.

Yes we have had a survey but we only had a home buyers survey as we wasnt aware of the subsidence.

That found no issues relating to the subsidence but this doesnt alter the fact i still need to notify the insurance company?

If it was a home buyers survey did they even check for subsidence? Would you know what to look for. Why not get a full survey, who pays? Well the vendors could pay and you choose the surveyor, if there are no problems then you could reimburse the vendors and you would have knowledge that there was no problem. If the vendors are aware of any problems then they will not want the survey done, if they are sure then there are no problems then they have nothing to lose.

flora48

Just had the same problem. The property we are buying was extensively underpinned in 1983 at a cost of £30,000. Mainstream insurers refused me point blank. Googled " insurance underpinning" and got quite a list of specialist insuers. We went with Woodstock who took the view that as it was so long ago it was an insurable risk. Policy has cost about £60 more than I pay on my existing house. Considered all the same options as you but decided to stick with it as I really don't think it is going to fall down, and the Homebuyers Survey found no evidence of subsidence.

Terrysdelight

I would seriously reconsider buying the property. Lots of lenders won't lend on properties with history of subsidence - you could come to sell the property on and find you'd have great difficulty. Get advice from your solicitor.

Doozergirl

Terrysdelight wrote: »

I would seriously reconsider buying the property. Lots of lenders won't lend on properties with history of subsidence - you could come to sell the property on and find you'd have great difficulty. Get advice from your solicitor.

I think you said this the other day and I didn't pick you up on it then, but I really don't think this is true. Insurance can be an issue, not uninsurable but there are specialist companies out there.

But as long as a property is currently structurally sound then mortgage lenders will lend. If there are queries over structurally stability then of course they are going to be wary (that is why they commission valuations) but if there is no ongoing movement, then they are fine. We have owned ourselves, with a mainstream mortgage, a house that we had to underpin (admittedly mortgaged it after it had been doen); bought underpinned and sold other properties without any mortgage issues to buyers using mainstream mortgage lenders and even in this climate a friend of ours has just sold two. (All with the relevant paperwork)

As far as the OP goes, someone has already given their relevant experience which is what I would have suggested - using a specialist company or broker (there are plenty if you google and I have definitely seen threads on the insurance board mentioning specialists if you run a search on that board)and having a sensible converation with a real person. After 35 years, this is drifting into distant memory and with no ongoing issues, the risk rating they apply should be much lower and the premium not too much more. General insurers will always be more expensive on specialist risks than specialist insurers; it's to do with the way they build their books - in effect, hedge their bets.

silvercar

I agree with Doozer. 35 years without movement is longer than some houses have been standing full stop.