Insurance query on sale

ACG

YBS/Accord one in the same.

As its BTL though im now thinking Mortgage trust or paragon. Great rates but not the easiest of lenders to deal with once it gets to the legal side (My solicitor has told me never to send her any more from paragon and another solicitor has started charging more on paragon mortgages).

lilab_2

ACG wrote: »

YBS/Accord one in the same.

As its BTL though im now thinking Mortgage trust or paragon. Great rates but not the easiest of lenders to deal with once it gets to the legal side (My solicitor has told me never to send her any more from paragon and another solicitor has started charging more on paragon mortgages).

From my experience, I if it is the same company, I can quite understand why.

I will find out tomorrow who the lender is.

Just praying it goes through.

G_M

lilab wrote: »

...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))
if the insurance document states this, simply re-send it highlighting the section

B - that adequate insurance cover is in place. (The policy is index linked and clearly states this on policy document)
index linked just means it increases annually. But if it was under-insured from the start it will still be under-insured. You need to compare the current level of insurance cover with the current re-build cost.
Does the mortgage offer state re-build cost?
If not, pay a surveyor to provide.

C- that the management company will raise with the insurance company their valuer's recommended minimum sum.
You are in the hands of the Mgmt Co, who are unlikely to want to do this unless a majority of leaseholders make them

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

That they believe insurance cover is adequate for the block and that it is index linked
what evidence do the mgmt company have of the current re-build cost?

That they will raise with insurance company but it will remain as block insurance.
Of course. that's normal

As a last resort you could self-insure your flat for the sum required.
It will cost you, and duplicates the Block policy (which ironically could result in insurance pay-out delays/problems as different insurers squabble over which must pay!) but might get the purchase moving...

lilab_2

Thank you G_M.

Buyer's solicitor already has a copy of the insurance policy.

As far as I am aware it states the rebuild cost of my flat, not the whole block and they began by insisting that my flat be insured separately. However I do not intend to double insure. That is for the buyer to do if he so wishes. The property is shared freehold. They made the assumption that all the flats are exactly the same and therefore the block underinsured, but two flats are each two thirds larger than the two smallest. There are six in total.

Forgot to say two have sold in he last six months with no queries on insurance value

JPB123

ACG wrote: »

YBS/Accord one in the same.

As its BTL though im now thinking Mortgage trust or paragon. Great rates but not the easiest of lenders to deal with once it gets to the legal side (My solicitor has told me never to send her any more from paragon and another solicitor has started charging more on paragon mortgages).

I know YBS / Accord are the same company. It was more the EA broker "Let's just DIP it with the lowest rate, f**k the service levels" mentality I was referring to. Accord do BTL as well

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

propertyman

lilab wrote: »

Thank you G_M.

Buyer's solicitor already has a copy of the insurance policy.

As far as I am aware it states the rebuild cost of my flat, not the whole block and they began by insisting that my flat be insured separately. However I do not intend to double insure. That is for the buyer to do if he so wishes. The property is shared freehold. They made the assumption that all the flats are exactly the same and therefore the block underinsured, but two flats are each two thirds larger than the two smallest. There are six in total.

Forgot to say two have sold in he last six months with no queries on insurance value

This has completely twisted the issue.

1 its not uncommon but the usual cause is that the valuer sets a figure and that has to be compared to the declared value in the block policy for the whole block

2 it can be that the valuer is aware of the declared value for the block and considers it inadequate

3 Based on the post the freeholder ( no such thing as shared freehold) insures the building and is responsible for the rebuilding of the whole property, which has nothing to do with the size of the flat. That is because it is the whole premises that are insured and you pay a proportion of the premium in many cases based on the size, but that doesn't mean you are insured for x% of y, it is the whole block that is insured.

It suggests that there is an issue for the freeholder to consider at to when it was last valued for insurance purposes and not as I suspect on market values which it has nowt to do with.

I suggest that you take out an indemnity policy and argue the lease in due course with your fellow freeholders, and if required force them to do so to insure adequately under the terms of your lease as a leaseholder ( which you will be no such thing as shared freehold).

ACG

JPB123 wrote: »

I know YBS / Accord are the same company. It was more the EA broker "Let's just DIP it with the lowest rate, f**k the service levels" mentality I was referring to. Accord do BTL as well

Ahh, gotcha.

Ive told my compliance people i am never using accord, they had no issues with that so long as i justify why on every suitability letter. Remortgages you could potentially understand using them (although i still would not use them personally unless i could up my fee for the extra work) but for purchases theres not a chance i would use them.