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  • FIRST POST
    • asm89
    • By asm89 29th Sep 19, 10:30 PM
    • 83Posts
    • 21Thanks
    asm89
    "Official" Thread for all of us waiting for a cladding report...
    • #1
    • 29th Sep 19, 10:30 PM
    "Official" Thread for all of us waiting for a cladding report... 29th Sep 19 at 10:30 PM
    Hi

    There are many of us in this boat, either trying to buy, sell or remortgage a flat and have been hit with the "we need a cladding report before we can lend" from the lender.

    I thought it'd be useful if we could all chat in one place, and so people can post updates on their situations in one place, to give others hope, advice and to help us maintain sanity during this period.

    I'll start with my situation.

    Purchasing a Shared Ownership new build flat in London off plan. It's due to be handed over to the Housing Association in a few weeks, this is already a delay of 6+ weeks from the original timescales

    All was going well with my mortgage application, but then it got surveyed. The surveyor gave a valuation but the lender (virgin money) has asked for a cladding report.

    VM initially gave a 2 week deadline to provide the report, this was then extended by a week. No real updates on this from the Sales Advisors, but they have been chasing the developers and HA for weeks now. So it looks like my mortgage app will get cancelled, and i'll have to reapply if and when this report gets produced.

    I've been assured that a report will be produced, but when is the question! It's all quite baffling given the apartments are still in development, so one would hope this kind of report is part of their build-complete/initiation process especially as the cladding was put on this year! After the government guidelines.

    The sales manager also told me that for another new build (which was already complete) sale, it took 3 months for the report to be produced!

    What is strange is that 2 other people have had mortgage offers for their apartments without having to produce this report, one used the same surveyor as mine! But these were issued some weeks before my survey was done, so it looks like banks have changed their approach overnight. My only hope is that the lack of cladding report is now preventing further sales progressing, so hopefully this will put some fire under the HA.
Page 1
    • gazebo
    • By gazebo 30th Sep 19, 7:28 AM
    • 446 Posts
    • 497 Thanks
    gazebo
    • #2
    • 30th Sep 19, 7:28 AM
    • #2
    • 30th Sep 19, 7:28 AM
    My FIL is currently stuck in this situation.

    Property is in Scotland, where the existence of building managers is not the same as the rest of the UK (feuhold rather than leasehold), although many do benefit from having a property factor (who is only there to help owners organise repairs, not really to manage the building as such)

    Unfortunately, when my FIL went to put his place on the market, the legislation changed that very week. So the surveyor has come back with a category 3 rating for the cladding. We already know, thanks to a sale in the build in March of this year that the cladding is not the same as that used in Grenfell (and have a letter from the council confirming this). However, due to the change in guidance to surveyors, an in depth cladding report is now required.

    I will keep you updated on developments from a Scottish perspective.

    It does seem at present like overnight, thousands of people have effectively been left with properties they are going to struggle to sell on and many will not have the benefit of discovering this until after they attempt to put it on the market.
    • haras_nosirrah
    • By haras_nosirrah 30th Sep 19, 8:01 AM
    • 2,047 Posts
    • 3,253 Thanks
    haras_nosirrah
    • #3
    • 30th Sep 19, 8:01 AM
    • #3
    • 30th Sep 19, 8:01 AM
    This is the biggest single issue we are coming up against at the moment.

    The problem is new rules came in which affects flats over 6 stories.

    Why new builds are being sold without having the reports in place is crazy because without the reports the properties are unmortgagble yet I don't think I have found one housing association who has done the reports

    It is incredibly frustrating
    I am a 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 advice.
    • mhuk01
    • By mhuk01 30th Sep 19, 12:21 PM
    • 108 Posts
    • 14 Thanks
    mhuk01
    • #4
    • 30th Sep 19, 12:21 PM
    • #4
    • 30th Sep 19, 12:21 PM
    I too am in a similar issue. Trying to remortgage an unencumbered flat, which has been deemed safe (although another block in the same development with different cladding is having to be replaced currently). I've submitted various reports but none have been accepted.

    I have received this from the lender: -

    “We require the Building Owner and/or its agent, as the 'responsible person' under the Regulatory Reform (Fire Safety) Order 2005, to produce a written statement to confirm that the cladding system(s) for the subject property meets the requirements of the current guidance from MHCLG. The statement must be prepared by a suitably qualified independent professional advisor who is a member of one of the professional bodies listed by the Ministry of Housing, Communities and Local Government (MHCLG) in Information Note 1 (or any subsequent list).”

    The statement should confirm the property meets the requirements of the current guidance from the Ministry of Housing, Communities and Local Government (MHCLG) and it must have been prepared and signed by a suitably qualified independent professional advisor."

    The lender is BM Solutions. Has anybody had similar issues and been successful with a lender?
    • haras_nosirrah
    • By haras_nosirrah 30th Sep 19, 12:39 PM
    • 2,047 Posts
    • 3,253 Thanks
    haras_nosirrah
    • #5
    • 30th Sep 19, 12:39 PM
    • #5
    • 30th Sep 19, 12:39 PM
    this is the report all the lenders want and none of them seem to be able to get.

    I know of a lender who will do it with a 40% deposit but the rates are high (they are the type of lender who will lend on the little pigs straw house with a 40% deposit)
    I am a 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 advice.
    • mhuk01
    • By mhuk01 30th Sep 19, 1:29 PM
    • 108 Posts
    • 14 Thanks
    mhuk01
    • #6
    • 30th Sep 19, 1:29 PM
    • #6
    • 30th Sep 19, 1:29 PM
    this is the report all the lenders want and none of them seem to be able to get.

    I know of a lender who will do it with a 40% deposit but the rates are high (they are the type of lender who will lend on the little pigs straw house with a 40% deposit)
    Originally posted by haras_nosirrah
    My broker seems to think we should try Leeds Building Society - whether they will be any better, I guess I'll find out. It's particularly frustrating as the building as been surveyed and replacement cladding is not required.
    • haras_nosirrah
    • By haras_nosirrah 30th Sep 19, 1:35 PM
    • 2,047 Posts
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    haras_nosirrah
    • #7
    • 30th Sep 19, 1:35 PM
    • #7
    • 30th Sep 19, 1:35 PM
    I had a leeds one picked up for cladding which went straight through with skipton - the lenders are all completely hit and miss as it depends on the surveyor of the day.
    I am a 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 advice.
    • terzinho86
    • By terzinho86 30th Sep 19, 3:08 PM
    • 11 Posts
    • 4 Thanks
    terzinho86
    • #8
    • 30th Sep 19, 3:08 PM
    • #8
    • 30th Sep 19, 3:08 PM
    We are in the same situation as per post "cladding of a combustible nature".



    "Cladding of a combustible nature is thought to be present at the property you are purchasing. Therefore we require confirmation of the following: • The type of cladding/insulation used on the building • That a review of the building has been carried out by a suitably qualified independent expert in accordance with the decision tree in MHCLG Advice Note 14 dated 18/12/18. • The results of this review. Further information may be requested on receipt of this information and the property may still be deemed unsuitable for lending."

    At this point we are waiting for the review by a suitably qualified independent expert in accordance with the Advice Note, but still no clarity on timescale. I suspect the entire development is or will be faced with this issue, probably ~1000 flats?
    • asm89
    • By asm89 30th Sep 19, 4:24 PM
    • 83 Posts
    • 21 Thanks
    asm89
    • #9
    • 30th Sep 19, 4:24 PM
    • #9
    • 30th Sep 19, 4:24 PM
    We are in the same situation as per post "cladding of a combustible nature".



    "Cladding of a combustible nature is thought to be present at the property you are purchasing. Therefore we require confirmation of the following: • The type of cladding/insulation used on the building • That a review of the building has been carried out by a suitably qualified independent expert in accordance with the decision tree in MHCLG Advice Note 14 dated 18/12/18. • The results of this review. Further information may be requested on receipt of this information and the property may still be deemed unsuitable for lending."

    At this point we are waiting for the review by a suitably qualified independent expert in accordance with the Advice Note, but still no clarity on timescale. I suspect the entire development is or will be faced with this issue, probably ~1000 flats?
    Originally posted by terzinho86
    Oh good, they've agreed to do one in your building, that's progress
    • davidmcn
    • By davidmcn 30th Sep 19, 9:17 PM
    • 13,434 Posts
    • 15,359 Thanks
    davidmcn
    Property is in Scotland, where the existence of building managers is not the same as the rest of the UK (feuhold rather than leasehold), although many do benefit from having a property factor (who is only there to help owners organise repairs, not really to manage the building as such)
    Originally posted by gazebo
    In practice I would expect any buildings with questionable cladding to be sufficiently large and modern that the factors probably play a more proactive role in management, so I wouldn't have thought that to be a particular difference, other than the fact that they're acting on behalf of the flat owners collectively, rather than a third party freeholder.
    • gazebo
    • By gazebo 1st Oct 19, 11:23 AM
    • 446 Posts
    • 497 Thanks
    gazebo
    I don't disagree davidmcn, however, it will often depend on who the Factor is. In this instance, they aren't known for being the most proactive and helpful.
    • Dirk Digg
    • By Dirk Digg 5th Oct 19, 3:10 PM
    • 6 Posts
    • 0 Thanks
    Dirk Digg
    I too am in a similar issue. Trying to remortgage an unencumbered flat, which has been deemed safe (although another block in the same development with different cladding is having to be replaced currently). I've submitted various reports but none have been accepted.

    I have received this from the lender: -

    “We require the Building Owner and/or its agent, as the 'responsible person' under the Regulatory Reform (Fire Safety) Order 2005, to produce a written statement to confirm that the cladding system(s) for the subject property meets the requirements of the current guidance from MHCLG. The statement must be prepared by a suitably qualified independent professional advisor who is a member of one of the professional bodies listed by the Ministry of Housing, Communities and Local Government (MHCLG) in Information Note 1 (or any subsequent list).”

    The statement should confirm the property meets the requirements of the current guidance from the Ministry of Housing, Communities and Local Government (MHCLG) and it must have been prepared and signed by a suitably qualified independent professional advisor."

    The lender is BM Solutions. Has anybody had similar issues and been successful with a lender?
    Originally posted by mhuk01
    I have received the same response from Halifax.

    Reports have been booked for the development, however I am trying to establish whether the statement above is to be given independently from the report (the agent and freeholder have so far seemed unwilling to put pen to paper).

    Does anybody know if this is the case?
    • asm89
    • By asm89 6th Oct 19, 3:15 AM
    • 83 Posts
    • 21 Thanks
    asm89
    I would check with the management company whether the testers can include a summary page in the report which mentions their certification and compliance or not.
    • hi123
    • By hi123 10th Oct 19, 11:21 PM
    • 255 Posts
    • 70 Thanks
    hi123
    i have had a zero valuation by barclays for a flat on east london
    stuck having paid for searches etc and found out that all leaseholders were sent information regarding problems with fire safety in june but did not share that with us and let us incur costs of conveyancing
    this week received email telling us testing has happened but report wont be available till dec
    3 months for a test already done?
    • EC3D
    • By EC3D 11th Oct 19, 1:53 AM
    • 5 Posts
    • 0 Thanks
    EC3D
    I'm a buyer and also recently had a zero valuation from Halifax until I can get the written statement. But my seller has spoken to the building owner, who has been told by their PI insurance not to write the blanket statement the bank wants. I am quite upset about the whole situation and wondering if any bank will lend without this statement!??

    It's frustrating because I have evidence to prove that the cladding is safe but the bank valuer specifically wants a 1 page statement, and I paid £200 for some guy to tell me that.
    • asm89
    • By asm89 11th Oct 19, 11:52 AM
    • 83 Posts
    • 21 Thanks
    asm89
    i have had a zero valuation by barclays for a flat on east london
    stuck having paid for searches etc and found out that all leaseholders were sent information regarding problems with fire safety in june but did not share that with us and let us incur costs of conveyancing
    this week received email telling us testing has happened but report wont be available till dec
    3 months for a test already done?
    Originally posted by hi123
    At least you know the report is coming. The wait is so annoying but it's not like the seller is going to pull out to be honest, you just need to check when your searches expire? You could also argue for the seller to pay the cost of any new searches given they didn't provide this information prior to your offer!
    • asm89
    • By asm89 11th Oct 19, 11:53 AM
    • 83 Posts
    • 21 Thanks
    asm89
    I'm a buyer and also recently had a zero valuation from Halifax until I can get the written statement. But my seller has spoken to the building owner, who has been told by their PI insurance not to write the blanket statement the bank wants. I am quite upset about the whole situation and wondering if any bank will lend without this statement!??

    It's frustrating because I have evidence to prove that the cladding is safe but the bank valuer specifically wants a 1 page statement, and I paid £200 for some guy to tell me that.
    Originally posted by EC3D
    What evidence do you have about the cladding being safe? And who was it from. The bank won't lend without proof but it may not need to be a 1 page statement.
    • LP.online
    • By LP.online 11th Oct 19, 3:07 PM
    • 3 Posts
    • 1 Thanks
    LP.online
    At least you know the report is coming. The wait is so annoying but it's not like the seller is going to pull out to be honest, you just need to check when your searches expire? You could also argue for the seller to pay the cost of any new searches given they didn't provide this information prior to your offer!
    Originally posted by asm89
    Hmm, that i disagree. I am a seller for my Shared ownership and I was also caught in the same situation having not known that the bank would require a cladding report and my HA did not have one when I wrote in to them to sell my Shared ownership back in July.

    My estate Agent, solicitors etc ... none of them in the chain were known to this "new requirement" by the Bank and of course no one wants to take responsibility for it and the ultimate losers are the buyer and seller having to folk out the sunk cost from our own pockets.

    I also have paid for the valuation of my flat as it is on Shared Ownership, therefore I cannot take a market price other than the price written down by HA's appointed valuation. The report cost me £300 and only valid for 3 months!
    • asm89
    • By asm89 11th Oct 19, 3:41 PM
    • 83 Posts
    • 21 Thanks
    asm89
    Hmm, that i disagree. I am a seller for my Shared ownership and I was also caught in the same situation having not known that the bank would require a cladding report and my HA did not have one when I wrote in to them to sell my Shared ownership back in July.

    My estate Agent, solicitors etc ... none of them in the chain were known to this "new requirement" by the Bank and of course no one wants to take responsibility for it and the ultimate losers are the buyer and seller having to folk out the sunk cost from our own pockets.

    I also have paid for the valuation of my flat as it is on Shared Ownership, therefore I cannot take a market price other than the price written down by HA's appointed valuation. The report cost me £300 and only valid for 3 months!
    Originally posted by LP.online
    Yeah you weren't aware of the requirements. It does seem that their seller was at least aware of a fire safety issue which might mean the cost of cladding replacement could be passed on to the new owner. I do understand why they didn't declare it though but still unfair.
    • EC3D
    • By EC3D 11th Oct 19, 3:41 PM
    • 5 Posts
    • 0 Thanks
    EC3D
    What evidence do you have about the cladding being safe? And who was it from. The bank won't lend without proof but it may not need to be a 1 page statement.
    Originally posted by asm89
    I have spoken to the seller who has certification from the local authority to say that the building is safe (this was post-Grenfell), and London Fire Brigade were even involved in supervising and certifying the cladding, there is a fire risk assessment, and the building insurance got renewed only a few months ago and everything was deemed safe and fine. I even found online a product brochure for that type of cladding that has passed the fire test as required by the MHCLG (granted it was from the Australian branch of the manufacturer but they use the same test standards).

    Unfortunately my bank will only accept the 1 page written statement and specifically stated they don't accept anything else. I even called other banks and they say the same thing. So it seems a lot of sellers and buyers will suffer from this now.
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