Million Pound extension – Lender requiring a structural warranty?

Million Pound extension – Lender requiring a structural warranty?

14:13 PM, 6th June 2022, About 2 months ago 2

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Two years ago I purchased a 4 Bed house for over £450k via a mortgage with Natwest. The house had a large footprint and my plan was the do an extension of the house.

The extension resulted in a new frontage of the house, new outer skin brickwork, reconfiguration of layout, new truss roof..etc. total cost of the extension was about £700k and that’s everything including 2nd and 3rd fixes.

We had planning and independent building regs. Recently during the final stages of the build, my Natwest mortgage was coming to an end, so decided to go with Metro bank, and get some more money out of the property. The valuer came out and said although the property value is about £1.5 million, it’s not suitable for lending as there is no structural warranty in place. A structural warranty is for new builds and this has not been built to a new build standard or specification.

I have planning and building regs for an extension build. Getting a structural warranty policy now will cost over £10k and even then some lenders will not accept a retrospective warranty.

I am a few weeks away from now getting my building regs sign off. How would it be possible to switch to another lender and could NatWest also take the same position if they were also to revalue?

The new build definition in lending criteria states if the property has been built in the last 2 years.

What if I wait 2 years, could I then remortgage?

Kalvinder



Comments

Ian Narbeth View Profile

14:33 PM, 6th June 2022, About 2 months ago

Hi Kalvinder
Discuss this with a good mortgage broker who will know the lender's requirements. £10K is not insignificant but in the context of a £1M transaction it is only 1%.

Wyn Burgess

9:01 AM, 11th June 2022, About 2 months ago

See Hart v Large, this case resulted in lenders requiring a Professional Consultants Certificates for significant work at the risk address. You could argue it is just an extension but you would still require a PCC. See if your Building Control inspector can provide this? Personally I don't think they are worth the paper they are written on judging by one I saw where there was minimal inspection of the work and caveats in the certificate but the PCC is everything as far as lenders are concerned.
Seem to be a lot of providers eg https://www.architectscertificate.co.uk/services/structural-building-warranty/new-build/

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