Insurance query on sale

lilab_2

Has anyone any experience on the following?

I am selling my apartment which is one of six in a converted Victorian country house.

My buyers' lender wants the apartment to be insured for a specific amount but the apartments are insured as a block as opposed to individually. This is making me feel uneasy about the outcome of the sale. My buyers' solicitor has now written to their lender to explain this and In the meantime I am worrying myself sick.

Any thoughts would be well received as I seem to have convinced myself to prepare for the worst!

Thank you

maninthestreet

This can't be first time in the history of house selling/buying that this has occurred. What does your solicitor say?

Jenniefour

Quit worrying - this is perfectly normal and shouldn't cause a problem.

lilab_2

Thank you. My solicitor says the lender might request a second valuation or that block insurance is increased. So I am waiting for lender's response.

lilab_2

Sorry to raise this again, but does anyone have first hand knowledge or experience in this?

It is still not resolved. Lender has asked management company the following:

A- that the insurers are aware of the nature of the property (ie that it is a converted house). (( they are aware and this is clearly stated in the policy document - copy provided))

B - that adequate insurance cover is in place. (The policy is index linked and clearly states this on policy document)

C- that the management company will raise with the insurance company their valuer's recommended minimum sum.

The management company's response has been to state the obvious in relation to point A

That they believe insurance cover is adequate for the block and that it is index linked

That they will raise with insurance company but it will remain as block insurance.

I would be grateful for any comments as I desperately want to exchange and this is the only thing stopping progression.

Two other flats have sold in the last year but this has not been raised with those sales.

Thank you again

cattie

Surely this lender has dealt with flat conversions before? It all sounds rather ludicrous to be honest.

Managing agents are appointed to deal with things such as insurance etc. & one assumes they know exactly what they are doing.

It's all very well your buyer's lender asking for amount of block insurance to be raised, but in effect they are expecting all other flat owners to have to cough up even more for their portion when it might not even be necessary.

Unless properties are very difficult to sell in your part of the world I'd be inclined to tell the buyer they need to seek another lender. Whatever lender it is it seems they are making no allowances for the fact that leasehold properties are normally insured on a block policy, & not individually.

ACG

This should not even be an issue.
Who is the lender? Handy to know for in the future.

I would be very confident this will get sorted, it sounds like they have copped for an annoying lender (my money is going to be on YBS?), it might just take a bit of messing around.

lilab_2

Thanks cattle.

Yes exactly. The insurance won't be raised. The lenders have been told over and over that the six flats are not the same as they are conversions in an old house. Therefore some are larger, therefore more expensive than others. The block insurance takes this into account and we are all covered.

lilab_2

ACG.

I don't know unfortunately. I have asked the estate agent to bring it up with my buyer's financial adviser as it was the agent who recommended their services. It is so frustrating.

JPB123

lilab wrote: »

ACG.

I don't know unfortunately. I have asked the estate agent to bring it up with my buyer's financial adviser as it was the agent who recommended their services. It is so frustrating.

Estate Agency broker? My money's on it being Accord

I am an Independent Mortgage Adviser



You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advi

lilab_2

Thanks for your response JPB123. It is a buy to let mortgage, that's as much as I know.

We have answered all questions but for over two weeks they just keep banging on with more!