Three high street lenders – Virgin Money, TSB and Skipton Building Society – have joined the commitment to offer mortgages on properties affected by building safety issues.
The three lenders will now consider mortgage applications for properties in buildings that are yet to be remediated, or where leaseholders are protected from remediation costs. This gives those looking to buy, sell and remortgage more choice, allowing people to get on with their lives.
Over three quarters of mortgage lending within England is now covered by the commitment, with the three new lenders recognising the impact of the Government’s reforms and progress in delivering building safety for those who live in high rise properties.
Supported by UK Finance and the Building Societies Association, Virgin Money, TSB and Skipton Building Society are among the latest lenders to add their names to the statement, a year after the first six largest lenders made the same public commitment.
Minister for Building Safety, Lee Rowley, says: “I am extremely pleased to see three new lenders doing the right thing and supporting leaseholders who are stuck in homes with building safety defects. This is a further sign of the market’s confidence in the solutions that we have put in place to protect leaseholders. From today, customers impacted by building safety issues will have more choice when looking to buy or re-mortgage. I would encourage more banks and building societies to join the commitment made by Virgin Money, TSB and Skipton.”
Valuation firms have also played their part in the efforts to improve customers’ journeys.
For example Virgin Money’s valuation Panel Manager, e.surv, is the latest to work with the Department to receive and exchange information on affected buildings which will help streamline their valuation processes. Along with other lenders and valuation firms this will ensure a smooth experience for customers looking to buy, sell or re-mortgage their property, the government believes.
This latest announcement demonstrates that protecting leaseholders in buildings with fire safety defects from unfair costs remains a priority, a government statement says.
It continues: “The department has taken a number of steps to protect innocent leaseholders from remediation costs since the Grenfell Tower tragedy in 2017, introducing some of the toughest building safety regulations in the world through our landmark Building Safety Act.
“The Act confirmed that those responsible for unsafe cladding, and not blameless leaseholders, will be the ones to pay to fix it. Moreover, in October this year, the department announced that the Government has agreed a pledge with five-sector leading insurance brokers, which could lead to thousands of leaseholders in buildings with identified fire safety issues seeing a significant reduction in their insurance premiums.
“The Leasehold and Freehold Reform Bill, introduced to Parliament in November, will help us go even further to protect leaseholders by delivering the Government’s manifesto commitments on leasehold reform.
“The Bill will include measures to amend the Building Safety Act 2022 to make it easier to ensure that those who caused building safety defects in enfranchised buildings are made to pay, and that the leaseholder protections are not unfairly weighted against those who own properties jointly.
“Within this legislation, we will ban building insurance commissions for freeholders and managing agents and replace these with transparent handling fees to stop leaseholders being charged excessive and opaque commissions.
“The Government is also already consulting on options to cap ground rents for existing leases that will protect leaseholders from facing unregulated ground rents for no service in return.”
