Mortgage Lending Opening Up On Cladding Affected Buildings

The announcement from the “big six” mortgage lenders (Barclays, HSBC, Lloyds Banking Group, Nationwide Building Society) in late December that they will now lend on buildings with cladding issues is good news and a step in the right direction. The caveat to the announcement is there needs to be evidence of self-remediation, coverage from government schemes or protections from the Building Safety Act. Although good news it will be a long slow road to “normality” and is definitely no immediate fix to the problem. All mortgage lending, however, is subject to regulatory requirements and individual firms’ lending policies.

RECOGNISED REMEDIATION SCHEMES IN ENGLAND ARE:
The Developer Remediation Contracts (11 metres+)
The Medium Rise Scheme (11-18 metres)
The Building Safety Fund (18 metres+)

Valuation guidance
Guidance has been published by The Royal Institution of Chartered Surveyors (RICS) to help valuers value properties with cladding to enable mortgage lending on affected properties. They will continue to support valuers, monitoring the impact of the new guidance to ensure it is proportionate, fit for purpose and helps facilitate mortgage lending while delivering a consistent approach to valuation.