Chancel repairs applicable - Do we buy this property

crawmo

We are in the process of exchange contracts and have just discovered that enclosed in our searches there is a successor chancel repairs indemnity insurance costing £15 applies to the property we are buying. Hence we would be liable to pay for any repairs towards the local chucrhe Chancel. Having read various threads and other online forums relating to such repairs etc am i being a little paranoid here in thinking that my new home (future pension investment) could be worthless when we come to sell?
I would imagine there is no guarantee that future insurance would be offered, and if offered it would be at such a high premium therefore putting any new potential buyer off?
Quotes like "would not touch with a barge pole" are not helping

Any help and advise on this subject would be much appreciated before we make any further commitment to our purchase.

Thank you - from a worried Man

PS I'm aware of the high profile case where a copule have been faced with a bill of £250,000.

HappyMJ

If you pay the insurance of £15 then you do not pay for the repairs yourself. The insurance company will pay them for you. The insurance is for the lifetime of your ownership of the property usually up to 25 years. They faced a bill of £350,000 as they did not have insurance. http://news.bbc.co.uk/1/hi/wales/mid/3023276.stm

Emmzi

crawmo wrote: »

We are in the process of exchange contracts and have just discovered that enclosed in our searches there is a successor chancel repairs indemnity insurance costing £15 applies to the property we are buying.

I do no think you undertand the concept of insurance.

The insurance is to cover you should a repair bill arise.

Talk to your solicitor, they will take you through it.

Unless you decide you do not want to pay £15 - £50 for insurance. In which case yes, you may get a giant bill...

HapPea

The OP is worried that insurance may not be available in the future or the premiums would be so high that future purchasers would be put off.

I guess there are no guarantees but even if the insurance increased 10 fold it still wouldn't be that much

withabix

HappyMJ wrote: »

If you pay the insurance of £15 then you do not pay for the repairs yourself. The insurance company will pay them for you. The insurance is for the lifetime of your ownership of the property usually up to 25 years. They faced a bill of £350,000 as they did not have insurance. http://news.bbc.co.uk/1/hi/wales/mid/3023276.stm

They actually paid nearly £550,000 in the end, but not until 2009.

http://www.shropshirestar.com/latest/2009/10/21/church-repairs-row-over-as-farm-sold-off/

The farm was actually an inheritance, so the couple were in fact being rather greedy IMO, because they didn't pay for the farm in the first place.

They were trying to get a pre-existing obligation overturned.

It cost them nothing.

They probably gained rather a lot in farm subsidies over the time they owned the inherited farm.

The new owners are free of the obligation - the £550,000 included £37,000 to sell the obligation back to the CofE.

poppysarah

Hasn't the law changed on chancel repairs recently?

martindow

poppysarah wrote: »

Hasn't the law changed on chancel repairs recently?

I think it is due to change next year.

pmlindyloo

martindow wrote: »

I think it is due to change next year.

Here's the relevant information:

this situation will change with effect from 13 October 2013. After that date, new owners of land will only be bound by chancel repair liability if the latter is entered in the land register. This puts the onus on Parochial Church Councils to identify all affected land and register their interest before that date (no fee is charged).
An online petition to the Prime Minister requesting legislation to remove this liability resulted in the following response from 10 Downing Street on 6 March 2008:

Chancel Repair Liability has existed for several centuries and the Government has no plans to abolish it or to introduce a scheme for its redemption. The Government has, however, acted to make the existence of the liability much simpler to discover. From October 2013, chancel repair liability will only bind buyers of registered land if it is referred to on the land register. By that time, virtually all freehold land in England and Wales will be registered. The Government believes that this approach strikes a fair balance between the landowners subject to the liability and its owners who are, in England, generally Parochial Church Councils and, in Wales, the Representative Body of the Church in Wales.
The Government acknowledges that the existence of a liability for chancel repair will, like any other legal obligation, affect the value of the property in question, but in many cases this effect can be mitigated by relatively inexpensive insurance. It is for the parties involved in a transaction to decide whether or not to take out insurance.

ray1ray

This has to be the best scam since PPI. I don’t know who came up with the idea but it’s a belter.
You are purchasing a property (in my case a BTL). Your solicitor conducts relevant searches that arrive with an obscure and unverifiable potential Chancel repair liability (CRL) that you need to insure against and which is virtually only available through your solicitor because the risk of going on the open market could highlight to the CofE that there is an opportunity to pursue you (and any other nearby house owners) for this rarely (so far) invoked Chancel repair liability.


The people who conduct the search and arrive at the result can’t/won’t identify the Church concerned (they say) for fear of identifying to the CofE properties available for CRL.
You should not investigate for yourself in case you alert the CofE to a potential for recovery of CRL or worse you could disadvantage your neighbours.
You risk the CofE taking advantage and labelling your property (and those of your neighbours) with a confirmed liability.
The potential areas of liability are buried in ancient Parish and tithe documents not available to the layman.


You are left with an insurance expense guarding against an unknown, unidentifiable and probably redundant risk.
If you don’t take the insurance you risk the Church knocking on your door.
If you do take the insurance you may completely waste your money because there is no CRL.
If you take out perpetuity CRL insurance you could waste your money when in October 2013 the Church doesn’t identify your property as a target for CRL.


This has to be the insurance con of this decade.
The potential repair liability insurance premium may only be small but multiplied by the number of properties that are going to be tagged with this risk (virtually all because no one will precisely say where the risk lies) the income from this scam is huge and there is nothing you can do but subscribe to it. It’s obscene.
As for this Governments inaction over this, it smacks of a conspiracy to reimburse the insurance industry who claim to have been so hard hit by claims for flooding and damages from rioting.

bouicca21

As one of the few (only?) people on this forum who knows how to do a chancel repair search properly, I can assure you that this is almost certainly a scam. The chancel repair search companies use the big case (where the huge bill was legal fees to challenge the liability which they knew perfectly well that they had, rather than repair costs) to scaremonger and do a search that merely says 'this parish is in the index of documents relating to chancel repair liability.' Such a search does not indicate that a liability exists since almost all the documents indexed actually say no liability exists. Besides the index identifies at parish level and any liability, if it exists, actually applies to specific plots of land within the parish.

If you are worried do a proper search youself or hire a competent person to do it for you.

Clearlier

bouicca21 wrote: »

As one of the few (only?) people on this forum who knows how to do a chancel repair search properly, I can assure you that this is almost certainly a scam. The chancel repair search companies use the big case (where the huge bill was legal fees to challenge the liability which they knew perfectly well that they had, rather than repair costs) to scaremonger and do a search that merely says 'this parish is in the index of documents relating to chancel repair liability.' Such a search does not indicate that a liability exists since almost all the documents indexed actually say no liability exists. Besides the index identifies at parish level and any liability, if it exists, actually applies to specific plots of land within the parish.

If you are worried do a proper search youself or hire a competent person to do it for you.

At £15 it's cheaper to pay for the insurance than the search if you haven't got the time/knowledge/inclination to do the search yourself.

I imagine that the governments plan will have the effect of getting rid of the insurance/search requirement for the vast majority of properties and raising the premia of those who are affected. Depending upon the magnitude of the increase in premia which will have a number of factors influencing it this may have an impact on some house prices.

To the OP's question this as I understand it this is a fairly routine precaution. If the property you propose to purchase is responsible for chancel repairs then there is a possibility albeit dependent upon a number of factors that if/when you come to sell the property in the future the value of your property will be affected. I'm in the process of purchasing a property and we were advised to pay for the insurance rather than conduct a search as it's much cheaper to do this. I'm not particularly concerned about it but if you are then you should discuss it with your conveyancer.