Problems to get architects certificate from developer

chrichianti

Some months ago I have made a reservation for a flat in a public house NEW conversion. I applied for an HSBC mortgage, which was refused (after I had paid) because my developer cannot offer a 10 years warranty. The developer offered a price-reduction to give me a possibility to apply for a mortgage with another bank or buy cash, which at this point I would prefer. Works have not been finished and before exchanging I asked the developer for a "professional consultants certificate", but he
only offers a "certificate signed on behalf of a limited company rather than an individual architect. RIBA says this kind of certificate is of no value for a buyer and my solicitor says that the other flats in the building (some other clients have made reservations)will hardly be sold with this kind of
certificate which is not accepted by any lenders (???). Living abroad (sorry for my english) makes things even more difficult and also the fact that
the agency who sells these flats (a big company) is not being very helpful and has never informed me that no "serious" certificate would be available. I would be extremely happy for any information or
opinion in this matter.

teneighty

This is not a subject I can claim to be an expert in as i haven't done one of these for a number of years but I'm surprised that all certificates signed on behalf of a limited company are not accepted by any lender as your solicitor has stated. It is becoming much more common for professional consultants to trade as limited companies or limited liability partnerships. The important thing is that the Company/LLP carries the required professional indemnity insurance.

Who has the developer got to issue the certificate? Is it an independent professional consultant (to the best of my knowledge it still doesn't only have to be an architect)? If not I can understand why the lenders may be reluctant.

It might be worth posting your query on the mortgage thread to get an opinion from a mortgage expert's point of view.

Good Luck

chrichianti

It might be worth posting your query on the mortgage thread to get an opinion from a mortgage expert's point of view.

Good Luck[/QUOTE]

I have done so and this is the answer from one of the forum-members:

A limited company could go bust the day after completion meaning it is literally not worth the paper it is written on.

teneighty

That is nonsense. An architect or any professional consultant trading as a sole trader or a partnership could just as easily go bust the day after completion.

The certificate is only as good as the indemnity insurance the company or individual has in place. Most professionals have to maintain insurance for upto 7 years after they stop practising or face charges of professional misconduct from their relevent institutions which can carry a very heavy financial penalty not to mention being struck off and loss of livelihood.

I'm not suggesting it doesn't happen, there are rogues in all walks of life but I cannot see that the trading position of the firm makes the slightest bit of difference when it is the rules of conduct that all professionals have to work under that are the real deterrent against wrongdoing. I would suggest the poster who made that claim does not understand the rigid rules we have to work under and lumped us in with the likes of dodgy back street double glazing companies who seem to set up and dissolve limited companies on an almost weekly basis to avoid their liabilities.

You have got me worried now that my clients may see me as being less reliable because I trade as a limited company. I'll have to find your other post and put the record straight.

Anyway, at the end of the day the only people who really matter in this instance are your potential lender. So whatever hoops thay ask you to jump through you will have to comply or look elsewhere for the funds. If their lending criteria excludes certification from limited companies then that is that, but like i said originally, I would be very surprised if that was an industry standard. My main concern would be that the developer has actually got an independent professional consultant to inspect and certify the work (irrespective of the firms trading position) as well as getting a copy of the building control completion certificate. But non of these are a substitute for a ten year building warranty which is a whole other can of worms that we don't need to open here.

chrichianti

thank you all - my solicitor will try to find out about the indemnity insurance, but we are also trying to convince the developer to get a
"proper" certificate. I am aware that any such certificate has nothing to
do with a 10 years warranty, but it's a risk I accept.