Thousands of flat owners face months, possibly years, of being unable to sell or remortgage because they cannot get hold of new fire safety paperwork required by banks and building societies. Rules brought in after the Grenfell fire, which killed 72 people in 2017, mean surveyors acting for mortgage lenders are making extra checks to ensure a building’s construction is free of combustible materials.
Many are asking for evidence of an external wall survey, which comes in the form of an ESW1 certificate – and problems are arising as people find that their building does not have one. Frustrated homeowners are not only unable to sell – unless they can find a cash buyer – but can face months on their lender’s most expensive deal: the standard variable rate. Those with shared-ownership properties have also found they are unable to get mortgages to “staircase up” – the process of increasing the proportion of the home that they own.
Chris Sykes, a mortgage consultant with the broker Private Finance, says it is a big issue for would-be borrowers. “Risk-averse surveyors are reporting that they can’t be sure that a building is cladding free or fire safe, and as a result the mortgage company won’t lend unless they see the certificate, which the management company usually can’t or won’t provide,” he says.
“It is mostly affecting flats in higher-rise buildings built in the past 10 years but others are being caught up in it, too.” The EWS1 certificate was introduced last December to give lenders confidence to lend on apartments built before changes to the building regulations in 2018.