Close to exchange, may be no building regulations, indemnity insurance?

lizzyshep

Were hoping to exchange next week, got contract from solicitors to see that sellers are claiming no building works done to property. We know this to be incorrect and that works include a two storey back extension and removal of a wall downstairs to knock the two reception rooms together.

It is possible they made a mistake on the form but we are concerned they may not have the correct paperwork so are not being truthful. Don't know when works were done but house is over 100 years old and they have been there around 25 years. Our solicitor doesn't seem too worried and is going to look into it on Mon, but I am spending all weekend worrying!

My questions are:

Do we need to inform our mortgage lender and if so, are they likely to downvalue the property?

Will they normally accept an indemnity policy? (They are Nationwide)

Will this invalidate our buildings insurance?

And if a structural engineer takes a look, what will they need to do to check if it's safe, and if it is, are we ok to proceed?

Thanks .

G_M

lizzyshep wrote: »

....
My questions are: do we need to inform our mortgage lender I assume your solicitor is also acting for the lender? If so, he has a duty to inform them if he thinks it is relevant to them, so I would ignore this. Either he will or he won't.
and if so, are they likely to downvalue the property? Depends on the circumstances.
Will they normally accept an indemnity policy?Quite often - the more relevant question is should you accept one?
(They are Nationwide) Will this invalidate our buildings insurance? I doubt it, but read the assumptions in your insurance application. Does it include an assumption that the property has not been extended?
And if a structural engineer takes a look, what will they need to do to check if it's safe,
To me, this is a far more important question. You are going to live there - you need to know it is a) safe b) well constructed and c) re-saleable. Indemnity insurance will not cover any of theses.
and if it is, are we ok to proceed? Thanks .

Much depends when the work was done, by who and how.

If the work is old, and pre-dates Planning Permission and/or Building Regs then
a) the lack of paperwork is not a legal issue
b) the lack of paperwork indicates nothing about quality
c) if it has not fallen down (or caused problems) in the (many) intervening years, it is unlikely to do so now

If it is more recent, you have to ask why paperwork was not put in place. The paperwork itself is relatively cheap. What pushes up the price of building work is obtaining the quality required to get the paperwork. A cheap builder, cutting corners, can put up an extension for peanuts - so long as Building Inspectors are not invited in - but do you want to own it?

Unfortunately a structural engineer is almost certainly going to need to expose the structure (hidden behind plaster etc) in order to evaluate the work. The seller may well not want his plaster ripped off!

I cannot advise the best course of action, but the first step is to try to establish when the work was done.

lizzyshep

Thanks for your detailed reply. It has confirmed my worries about an engineer needing to expose the structure, I doubt seller will agree to this. I am hoping work was carried out a long time ago and seller can prove this, I will feel happier if it has stood the test of time. I know a lot of old building work would not pass existing regulations but this doesn't mean they are unsafe. I do need to check what the insurance says, I don't remember a point about it being extended but it does say certain things won't be covered if there has been shoddy workmanship or materials.

This is all so stressful! I know it is a common problem and may well be ok (Homebuyer Report didn't highlight any serious issues) but it's not what we need this late in the process :-(

hethmar

I thought the question was whether there had been building work in the last ten years? Any longer than that and planning arent interested. If its been ok for 25 years I dont think you need to worry at all.

lizzyshep

hethmar wrote: »

I thought the question was whether there had been building work in the last ten years? Any longer than that and planning arent interested. If its been ok for 25 years I dont think you need to worry at all.

It doesn't give a timescale on the form but perhaps they were advised that it was 10 years. It is hard not to worry. Also, when we viewed the house they said they had 4 previous offers that fell through due to mortgages falling through , wish we'd asked why as I can't help thinking this might have been the reason.

lizzyshep

Oh, and on the local searches it says there have been none of the following granted, issued, refused or pending: building regs approvals since 1/1/2000; building regs certificates or notices issued regarding work done under competent persons self-certification scheme since 1/4/2002. Not sure if this means there were approvals or certs prior to these dates, or if these are general cut off dates - does anyone know?

lizzyshep

Ok, have had advice from solicitor who is finding out when works were done. They have suggested two courses of action - get retrospective permission from Building Control which would then invalidate any indemnity insurance or go for an indemnity policy.

We will probably go with the second option as we want the house - we know future buyers may not accept this but we are planning to grow old in the house so assume that by the time we do come to sell (30+ years) that the council won't be concerned about this. How long is it before lack of building regs becomes an issue?

Now, to ensure property is sound we will want a structural engineer to confirm the property is safe. If the seller is not happy with this (e.g. if they need to remove plaster etc) would we be mad to proceed? I am thinking if the works are old it should be ok but how old is old enough? Also, who should pay for the engineer and the indemnity policy?

lizzyshep

Also meant to ask - the indemnity policy covers: 1 planning permission and building regs or 2 building regs alone, the first option is twice the cost of the second. I think the extension is old and if it's older than 10 years we don't need to worry about planning permission so can go with the cheaper option. Is this correct?

Richard_Webster

By the way it is very common for people to fill in the Property Information Form question about whether there has been any building work as if it referred to building work by them, which it doesn't.

For some reason a very high proportion of sellers simply misread this question. Most buyers' solicitors have got bored with making sympathetic comments about the seller's poor eyesight not seeing the obvious two storey extension, because this happens so often!

The people who invented the form should have known that and made it 200% clear that it applies to work done at any time even before they bought. The form I use for my clients' sales makes it clearer to avoid this piece of stupidity.

Amphion

Hi

I am a structural engineer and I am going to obviouslyadvise you get one to look over your property but I’m not just saying that tokeep my industry going!

My advice to youwould be to get an engineer/surveyor to have a look at the property and makesure all alterations are safe. Indemnity insurances are all well and good butas we all know with insurances it isn’t always easy to claim and get paid!

I haven’t had much dealings with these indemnity insurancepolicies you speak of however as I understand they are to indemnify for theevent of the regulations (planning or Building regulations) being enforced in retrospectnot to cover you if the building falls down. Please feel free to correct me if I’mwrong with that last statement!



Good luck

lizzyshep

Thanks Richard. Unfortunately we know the sellers have done work themselves as they told us this when we viewed the property. If you have any other advice it would be much appreciated, I have read several of your posts regarding similar matters and it has all been useful.

I did speak to a structural engineer today who confirmed he would need to remove plaster etc to check the structure out properly, though he said he could start by looking for any signs of damage and tell us if the wall is load bearing, this will cost £300 though and I'm not sure it's worth it as he won't be able to tell for sure and it is another expense (plus we had a Homebuyer survey done which didn't see any obvious problems).

We need to wait and hear back from the seller to see if they have any guarantees and proof of when the work was done, if not I am wondering whether it would be reasonable to try and negotiate a lower purchase price, and whether they are likely to agree to it.

I have also remembered that my sister's partner comes from a family of builders who buy and sell a lot of property so am going to talk to him tonight - I know it's not the same as getting in an engineer but it's a start!