In January 2020 they were consolidated and updated into one single advice note which has much wider implications. It is important that you read all these details to understand how this may affect you.
Mortgage lenders have begun making extra requests of people who apply for mortgages on properties in purpose-built blocks and they want applicants to provide independent assurance that the external wall systems and balconies of buildings meet the requirements of the advice notes. In many cases they are asking for this in the form of something called an EWS1 Form.
“What is an EWS1 Form?”
An EWS1 form provides independent assurance that your building meets the requirements of the government’s latest standards. In some instances, this may involve intrusive inspection by ‘opening up’ the external wall systems and testing the materials to ensure they meet the new guidance.
This is not a legal requirement however some lenders are asking for EWS1 forms before they will consider offering a mortgage.
The Royal Institute of Chartered Surveyors (RICS) have produced guidance on the EWS1 form suggesting that no building below four storeys should require an EWS1 form. It also says buildings of four or five storeys may need one as an exception, but this should only be if there is a specific concern. Unfortunately, when the government broadened the scope of its advice on combustible materials in January 2020, it led some mortgage providers to interpret the guidance as applying to a wider range of buildings. This means that in some cases it is difficult for leaseholders to remortgage, staircase (buy a greater share of their property) or sell their homes.
“What are you doing about this?”
We recognise that any delay in a mortgage application will be frustrating and we are doing all we can to support people that are affected. Where we believe an ESW1 request is in line with the RICS guidance, we will support our homeowners to provide this evidence to lenders.
Where Sanctuary is the freeholder of a building, we take a risk-based approach based on criteria we gather from our records and surveys. This allows us to determine the risk level and prioritise those where we deem there is a need for an intrusive assessment to be conducted.
It should be noted that because of the national demand and shortage of skilled professionals who can carry out an assessment, this may not happen quickly. In the meantime, we will support leaseholders by continuing to provide available documentation to them as part of their sale or staircase enquiry.
We are discussing this issue on a case-by-case basis with homeowners who are currently in the staircasing, remortgaging, or sale process.
“What if this affects me?”
We encourage any homeowner who is looking to sell, remortage or staircase a home in an apartment block to seek advice before incurring any fees for legal or financial advice.
If you are concerned that your ability to staircase or sell your home might be affected by these changes, please seek advice directly from your lender or mortgage broker.
Approaches differ between lenders, from building to building and according to people’s individual circumstances. Sanctuary has no control over valuations or the granting of mortgages and the terms attached to them.
Some homeowners have a property within blocks that Sanctuary does not own, or has responsibility for the structure of the building, in these instances such assessments are the responsibility of the freeholder or managing agent.
We would like to reassure all leaseholders that building safety is our absolute priority; we ensure they have up to date Fire Risk Assessments in place which are available on request.
Sanctuary would like to apologise to residents who have been affected by this issue. We understand how upsetting and frustrating this is and, with our partners in the sector, we are doing everything we can to find a way forward with the Government.
Finally, we would encourage anyone to contact us to discuss if they have not been able to sell their property and would like to explore the option of sub-letting.