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    • borford
    • By borford 5th Aug 19, 1:51 PM
    • 5Posts
    • 1Thanks
    borford
    ACM Cladding - which lenders will
    • #1
    • 5th Aug 19, 1:51 PM
    ACM Cladding - which lenders will 5th Aug 19 at 1:51 PM
    I am in the process of selling my flat in Manchester. Unfortunately it is fitted with ACM cladding, which at the time of development was in line with guidelines. However since the Grenfell tragedy, the Government has revised guidelines and ACM is now banned.

    Our management company and developer have made leaseholders aware that they will be replacing the cladding and have put in place a 'waking watch' (24/7 x 2 fire wardens). The cost of this is being covered by the developer.

    I have a buyer in place who is keen to progress, however he is using Halifax as a lender and they have asked for the following, which must be provided during the survey:

    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) (both ACM and non-ACM materials) 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)"

    I requested this information from our property manager and the response was:

    "Please note we cannot produce the statement you require. If the subject property was meeting the requirements of the current guidance from MHCLG as requested below, there would be no need for the works we are currently undertaking. It will take around a year time for the work to complete before this can be confirmed."

    Does anyone know of a way of progressing with the sale? Or of any high street lenders who would be willing to lend?

    Thanks for any and all help in advance.
Page 1
    • muhandis
    • By muhandis 5th Aug 19, 1:58 PM
    • 984 Posts
    • 752 Thanks
    muhandis
    • #2
    • 5th Aug 19, 1:58 PM
    • #2
    • 5th Aug 19, 1:58 PM
    Unfortunately, from what I can see, I don't see a way out other than waiting for the work to complete and then market it or sell to cash buyers only (probably at a heavy discount).

    In the first instance, I would talk to a mortgage broker local to the area who is likely to have worked with such flats.

    If you aren't desperate to sell right now, in your place I would wait for the work to complete (1 year will fly by) before trying to sell it.
    • guitaristgba247
    • By guitaristgba247 6th Aug 19, 9:13 PM
    • 1 Posts
    • 0 Thanks
    guitaristgba247
    • #3
    • 6th Aug 19, 9:13 PM
    • #3
    • 6th Aug 19, 9:13 PM
    Hi there,

    I was wondering if you've had any resolution to the issue?

    I am also having similar situation currently, where my buyer's lender requires exactly the same set of written statement as mentioned regarding cladding.

    The issue with mine is that even the management company aren't able to provide any information on the cladding and we have now reached out to the freeholder waiting for reply. The only positive thing at the moment is that the management company has mentioned our exterior facade is not ACM cladding and is cement screed finish. This is still not a good enough statement for the lender and they keep pressing for the statement, otherwise my buyer would not be able to lend with this lender.

    Anyone else could shed some light on this would be great.

    Many Thanks
    • borford
    • By borford 7th Aug 19, 1:38 PM
    • 5 Posts
    • 1 Thanks
    borford
    • #4
    • 7th Aug 19, 1:38 PM
    • #4
    • 7th Aug 19, 1:38 PM
    Hi,

    No not yet. I have tried to offer assurances to the buyers lender that the cladding is being replaced, but they have said that it has to be inline with current government guidelines. It won't be for about a year whilst the work is going on.

    My buyer is speaking with a mortgage advisor and I have engaged with mine to find out whether there are other lenders who are more lenient.

    I think you really need to push your management company. They should be required to provide this information, as they have tested the exterior as you mentioned.

    Thanks
    • muhandis
    • By muhandis 7th Aug 19, 1:46 PM
    • 984 Posts
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    muhandis
    • #5
    • 7th Aug 19, 1:46 PM
    • #5
    • 7th Aug 19, 1:46 PM
    I agree with you, but from their point of view, unless they absolutely have to, they will do anything to avoid putting anything down in writing that might come back to bite them hard. That's probably the advice they get from their lawyers.

    They should be required to provide this information, as they have tested the exterior as you mentioned.
    Originally posted by borford
    • Lemonade2018
    • By Lemonade2018 17th Aug 19, 7:57 AM
    • 40 Posts
    • 12 Thanks
    Lemonade2018
    • #6
    • 17th Aug 19, 7:57 AM
    • #6
    • 17th Aug 19, 7:57 AM
    Any further update on this?
    • borford
    • By borford 27th Aug 19, 1:53 PM
    • 5 Posts
    • 1 Thanks
    borford
    • #7
    • 27th Aug 19, 1:53 PM
    • #7
    • 27th Aug 19, 1:53 PM
    My mortgage advisor found a lender than will (Santander), however due to the nature of the way in which my buyer intends to fund the property (long story), I'm not sure he's going to progress.
    • haras_nosirrah
    • By haras_nosirrah 27th Aug 19, 2:39 PM
    • 2,118 Posts
    • 3,345 Thanks
    haras_nosirrah
    • #8
    • 27th Aug 19, 2:39 PM
    • #8
    • 27th Aug 19, 2:39 PM
    santander have just told me that they would only accept if the cladding has been fire tested and confirmed safe according to the new regulations.
    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.
    • Lemonade2018
    • By Lemonade2018 27th Aug 19, 2:40 PM
    • 40 Posts
    • 12 Thanks
    Lemonade2018
    • #9
    • 27th Aug 19, 2:40 PM
    • #9
    • 27th Aug 19, 2:40 PM
    May I ask what your situation is...are you buying or selling?
    • muhandis
    • By muhandis 27th Aug 19, 3:08 PM
    • 984 Posts
    • 752 Thanks
    muhandis
    May I ask what your situation is...are you buying or selling?
    Originally posted by Lemonade2018
    OP appears to be selling.

    I am in the process of selling my flat in Manchester. Unfortunately it is fitted with ACM cladding
    Originally posted by borford
    • haras_nosirrah
    • By haras_nosirrah 28th Aug 19, 2:04 PM
    • 2,118 Posts
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    haras_nosirrah
    Am researching this for a client who is looking to buy a property with amc cladding.

    Have contacted every Bdm I can and nearly all are saying no until the cladding is removed or until the property checks confirm it is acceptable to the new standards.

    I have had a lender come back as a yes 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.
    • JMA74
    • By JMA74 28th Aug 19, 2:50 PM
    • 1,087 Posts
    • 784 Thanks
    JMA74
    Am researching this for a client who is looking to buy a property with amc cladding.

    Have contacted every Bdm I can and nearly all are saying no until the cladding is removed or until the property checks confirm it is acceptable to the new standards.

    I have had a lender come back as a yes with a 40% deposit
    Originally posted by haras_nosirrah
    Together Homeloans? They would lend on the 3 pigs starw house with 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.
    • Lemonade2018
    • By Lemonade2018 28th Aug 19, 9:11 PM
    • 40 Posts
    • 12 Thanks
    Lemonade2018
    So what do sellers do when their home they are trying to sell is affected by cladding?

    It could take years for the management company to fix.
    • davidmcn
    • By davidmcn 28th Aug 19, 9:35 PM
    • 14,425 Posts
    • 16,876 Thanks
    davidmcn
    So what do sellers do when their home they are trying to sell is affected by cladding?

    It could take years for the management company to fix.
    Originally posted by Lemonade2018
    They need to wait until it's fixed.

    Or find a buyer willing to take on the risk - but in practice it's going to be cash buyers only.
    • haras_nosirrah
    • By haras_nosirrah 29th Aug 19, 6:30 AM
    • 2,118 Posts
    • 3,345 Thanks
    haras_nosirrah
    From my research over the last 2 days there are more options if the property is under 6 stories and there is a date for removal. My client was looking at a 9 story building and they are also hit by the new rules that came in Dec last year for any property over 6 stories with any form of cladding (not just acm) that they all have to have the appropriate certificates to show they confirm to the fire safety rules which if it is acm due for removal it clearly won't.

    Essentially if you are in an acm building under 6 stories with a removal date you have some options. Over 6 stories you just have to wait it out until it is gone.
    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.
    • borford
    • By borford 19th Sep 19, 12:37 PM
    • 5 Posts
    • 1 Thanks
    borford
    As an update, unfortunately the buyer fell through. He wasn't prepared to continue with Santander, so I can't give anymore info on what the outcome would have been.

    We listed our property with PurpleBricks and were advised by our agent to take a 'marketing break'. We are fortunate that the cladding is being replaced and have a rough date as to completion.

    That said, a cash buyer came to the fore and we have (reluctantly) accepted. Whilst we will not lose money on the property, we stand to make far less than we could have. As much as we could hang on to the property, for financial and personal reasons it is best to part ways.

    Whilst when purchasing we could not foresee what was to come, I do feel somewhat lucky that the cladding is being replaced and paid for by the developer. I sympathise with all those who are trying to make their next move and are unable to because of the new rules. All the best.
    • DavyNix
    • By DavyNix 13th Nov 19, 9:51 AM
    • 6 Posts
    • 0 Thanks
    DavyNix
    In the same position here, but just trying to re-mortgage

    The building company ‘Country Side’ have said that the government are only enforcing this on property’s over 18 metres high so will not be removing the cladding.

    Anybody had any success stories of those lenders that will work to the specifics of the regulation and not just point-blank reject us?
    Thanks - David
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