Category Archives: building warranty

 

17 
Jun

How does the Building Safety Act affect new build warranties?

How does the Building Safety Act affect new build warranties

Since the Building Safety Bill was introduced in July last year, there has been plenty of debate over the impact its reforms will have on the construction industry.

Now it’s being passed into English law as the Building Safety Act, everyone in this sector needs to know which regulations are changing and when the new laws come into force.

Let’s look into the timeline for new building regulations and how they will affect anyone providing or procuring a building warranty in England from June 2022.

How are new build warranties changing?

According to provisions in the Building Safety Act, all developers will have to secure a 15-year structural warranty for new builds and conversions before selling them. This prospective legal requirement will extend the minimum building warranty term from 10 years up to 15 years.

Though the Secretary of State has yet to set the specific regulations for new build warranties, they’re likely to mandate the following:

  • What each warranty must include (minimum levels of coverage and transferability)
  • The period of liability during which the developer is directly responsible for fixing problems
  • Financial penalties of up to £10,000 or 10% of the sale value for developers failing to comply

The requirement details, including costs and types of defects, will be in line with the Building Safety Act’s code of practice in the New Homes Ombudsman Scheme. Also, while new builds must have 15-year warranties, a parallel amendment to the Defective Premises Act 1972 extends retrospective liability from 6 years up to 30 years, allowing more homebuyers to claim compensation for defects.

Why is the government changing building safety laws?

The Building Safety Bill, now the Building Safety Act, aims to make significant changes to the ways that the construction industry operates in the UK. Following reviews of building regulations and fire safety after the Grenfell tragedy in 2017, the government is committed to improving building control standards, and giving people a clearer route of redress to ensure that any problems are fixed quickly.

With the range of proposed measures, the government will set out requirements to improve the ways that homes are constructed, especially residential high-rise buildings. New regulatory bodies will hold developers and builders to account by enforcing strict requirements for building safety and structural warranties, which will also give more transparency and peace of mind to homebuyers.

Overseeing every stage of construction, from planning and design to completion and occupation, should prevent miscommunications and mistakes. There should be clear expectations for all parties to avoid substandard work. Mandating warranty coverage also encourages developers to do their best work, as homeowners and leaseholders will have more opportunity to file claims against them.

When will these changes come into effect?

After receiving Royal Assent on 28th April 2022, the proposed Building Safety Bill was enshrined in law in England as the Building Safety Act. However, since these lengthy reforms require secondary legislation, most of these measures won’t be enforceable for around 12 to 18 months. This means that many of the new regulations won’t actually come into effect until 2023, or 2024 at the latest.

However, some parts of the Building Safety Act will come into effect much sooner. For example, extended liability will apply from 28th June 2022. From this date, new build structural warranties must provide 15 years of coverage rather than 10, and homeowners/leaseholders can now make structural defect claims for issues with pre-existing buildings up to 30 years after their completion.

Other aspects commencing from the end of June include increased regulations for construction products and enhanced leaseholder protections. To stay on top of which rules are being enforced when, it’s best to keep an eye on the government website for the latest building regulation updates.

Who does the Building Safety Act apply to?

The Building Safety Act and related secondary legislation will apply to the building industry and building owners, including architects, developers, contractors, and construction workers. Any person commissioning, planning, constructing, or refurbishing residential buildings – especially high-rises of at least 7 storeys or 18 metres – will need to follow the stricter requirements for building safety.

In particular, there will be a ‘gateway’ system designed to create a ‘golden thread’ of information that should keep everything in line through consultations at key stages:

  • Gateway One – planning permission applications demonstrating fire safety compliance
  • Gateway Two – building regulation compliance approved by a Building Safety Regulator
  • Gateway Three – final documentation submitted to Building Control for approval before issuance of a completion certificate

This should create a kind of unbroken thread of information that means problems can be identified right away, and regulators can halt construction at any stage if safety requirements aren’t being met. 

The gateway system will directly affect employers, contractors, and consultants who will be involved in any part of the construction process for multi-residential buildings in particular. Additionally, once a completed building is occupied, it must have a building safety management team with:

  • Accountable Person – the duty-holder (an individual or corporate body) responsible for registering with the Building Safety Regulator and applying for certification, plus assessing and revising safety risks and taking reasonable steps to prevent major incidents
  • Building Safety Manager – an individual or organisation appointed by the Accountable Person to support day-to-day management of structural and fire safety, including operating a complaints system for the building and complying with mandatory reporting
  • Special Measures Manager – appointed in the event of a First-Tier Tribunal case brought against the Accountable Person for repeated breaches of statutory obligations

As mentioned, non-compliance could result in a fine of 10% of the property sale value up to £10,000.

What should you do to prepare for the Building Safety Act?

While parts of the Building Safety Act are already in force, or soon to be, the majority depends on further legislation that is yet to come. There will be a more incremental transition for these aspects, so anyone in the construction or real estate sectors must keep up-to-date with each advancement.

For the time being, you should take the following steps if you believe the BSA will affect you:

  • Review your current terms and conditions for future compliance conditions
  • Update your document storage/record-keeping policy to reflect new time limitations
  • Re-evaluate third-party contracts, including professional indemnity insurance
  • Overhaul risk pricing procedures in consideration of potential future claims
  • Check past and current insurance policies for previously time-barred claims
  • Consider increasing provisions for more claims in your financial accounts
  • Keep track of regulatory developments as the BSA comes into full force

Similarly, anyone within your business should be made aware of the following changes:

  • High-risk buildings (as defined by the BSA) cannot be legally occupied until they are registered with the Building Safety Regulator
  • The Building Safety Regulator can issue compliance notices instructing certain actions, including commands to cease working
  • Notices for removing or altering non-compliant work can be issued up to 10 years from the date of completion (previously 12 months)
  • New build warranties must increase their coverage from 10 years to 15 years and comply with updated warranty regulations
  • Following Building Control approval, work must commence within 3 years before it lapses

It’s likely that the ‘gateway’ process will come into effect in April 2023, with registration systems for Building Control approval opening in April 2024. Don’t put off preparations until the last minute, though – figure out the changes you’ll have to make and how to fund them as early on as possible.

If you’re a current ABC+ Warranty policyholder or interested in applying for one of our building warranties soon, you can always contact our team to discuss the impact of the Building Safety Act.

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Published Date: 17th June 2022
Category: building warranty


 

15 
Jun

How much does a building warranty cost?

How much does a building warranty cost

While it isn’t required by law to have a building warranty, it’s often a requirement for financial lenders. So, if you want to get a mortgage to help you buy your dream home, you should make sure that the property has a structural warranty.

This policy should cover your property against latent structural defects from poor workmanship. Whether you want to buy or sell a new build within 10 years of its construction, you’ll find it much easier with the reassurance of a building warranty.

Building warranties are a relatively small expense with many benefits, but the cost can vary. Here are some of the main factors that can affect the cost of a structural building warranty.

Location and design

‘Where’ and ‘how’ are two of the most important questions when it comes to securing any type of insurance policy for a building. The property value will obviously vary depending on its size, but there are also regional differences. For example, property prices per square metre are generally higher in London and the surrounding southern area than in most towns in the north of England.

The type of building and its intended purpose will also affect the property’s value. Which materials and construction methods does it use? Will it be residential, commercial, or a mixed development? What about the ground conditions it’s built on? How likely are issues like subsidence and damp?

The larger a property is and the higher the risks associated with its location, design, and materials, the more it will cost to insure – which also applies to structural warranties.

Construction stage

The point the construction process has reached at the time of your application is also an important factor. Any building warranty provider worth their salt will want to inspect the build at key stages, from initial planning to completion, in order to identify any problems before they can cause defects.

If the property isn’t inspected from the beginning, and you only apply for a building warranty at a later stage, the risk of an unnoticed structural issue increases. That means the structural warranty price will also increase to reflect this level of risk. For this reason, it’s best to set up the warranty as soon as possible rather than waiting until partway through construction or until it’s all complete.

While it’s possible to get a kind of completed building warranty in some cases, it’s likely to cost a lot more – so don’t put it off if you want to get the cheapest quote.

Qualifications and experience

Relating to the construction process and materials, the experience of the construction workers not only affects the premiums, but also the likelihood of getting a structural warranty at all – not to mention a mortgage or other funding. Nobody will want to lend money or provide financial cover for a project with a team that has little to no experience in successfully completing projects of its type.

This is why it can be difficult to get a self-build warranty if you’re designing and constructing your own home without being a professional builder or architect. It’s usually the developer or project manager who first takes out the policy at the start, before transferring it to the homebuyer later on.

The more successful projects and years in business they have behind them, plus proof of relevant qualifications, the more likely a provider is to offer a favourable building warranty contract. 

How to get a building warranty quote

If you’re looking for a suitable structural warranty for your building that’s also affordable, why not try the ABC+ Warranty quick quote form? Or, for a more accurate quote that’s tailored to your circumstances, fill out our full quote request form and we’ll get back to you as soon as possible.

We understand that you’ll want to shop around for the best offer, but bear in mind that we also offer to beat genuine quotations from other providers. So, if you find a better deal elsewhere, Architects Certificate will always beat it when you come back to us. Ten years of peace of mind are definitely worth the investment, so contact us today to arrange your structural building warranty.

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Published Date: 15th June 2022
Category: building warranty, Uncategorized


 

11 
May

Does a new build home need a snagging survey?

new build snag checklist

Buying a new build home is exciting, but it’s important to be sure of what you’re getting before you commit to a sale. Nobody wants to move into their dream house just to discover endless problems with the building down the line. This is why it’s so important to thoroughly inspect the property before completion, giving you the opportunity to identify issues while there’s still time to fix them.

While it’s possible to do a DIY house survey, it’s easy to miss things or for developers to mislead you if you don’t know what you’re looking for. On the other hand, a structural warranty surveyor will have the experienced eye and equipment needed to analyse every aspect properly on your behalf.

Once the keys have been handed over and the home is officially yours, it can be difficult to get the seller or builder to take responsibility for fixing defects without this type of new build insurance. Here we run through the ways that new build surveys can help you, including a snag list template.

What is a snag list or snagging list?

A ‘snag’ is a slang term for a construction defect, with ‘snagging’ commonly used to refer to the process of identifying and correcting these defects. Snags tend to be the result of substandard workmanship and materials. They can be purely cosmetic, such as cracked tiles or messy paint, or more serious functional issues like faulty fittings – from windows and doors to wiring and plumbing.

The idea of a ‘snag list’ or ‘snagging list’ is to compile an inventory of existing or potential problems with a property at the time of the inspection. You can then present this information to the seller or builder, with the caveat that you cannot finalise the sale until they remedy all the issues on the list.

Of course, all new build homes undergo official checks for planning permissions before construction begins and building regulation compliance before receiving a certificate of completion. However, this doesn’t always guarantee that your new home will have the quality you expect, as these inspections might overlook comparatively minor issues, while a dedicated snag list should pick up on everything.

Who needs a professional property survey?

A snagging survey isn’t always necessary when buying a property. For example, when purchasing an older second-hand property a homebuyers’ survey would be more suitable. As this type of list is used to negotiate with the developer for further work, it’s most applicable for new build homes.

Completing a snagging list isn’t compulsory, but it’s useful when buying a new build off-plan or through the government’s Help to Buy scheme for first-time buyers. It can ensure that your finished property satisfies your expectations, rather than having to live with ongoing issues after moving in while the developer gives you the run-around – which they might try if you don’t have a warranty.

The developer isn’t obligated to provide a snagging survey for you, and they aren’t likely to offer, as many large developments are more concerned with quantity and speed than quality and attention to detail. Unless you have in-depth knowledge of construction yourself, you’re more likely to focus on superficial flaws during a DIY survey, and may not recognise the signs of more severe defects.

In these situations, it’s best to pass the responsibility to a qualified expert, who you can trust to carry out comprehensive inspections and push for resolutions to problems on your behalf. If you have a new build structural warranty in place, a surveyor should perform multiple inspections from the start of construction to right before completion, reducing the risk of undetected latent defects.

When should you get a snagging survey?

While professional inspections can take place at any point in the construction process, it’s best to do a dedicated snagging survey as closely as possible to completion. You can do this either before or after completion, but it’s best to assess the property before all work is finished and contracts signed, as the developers should be able to go back and correct the list of snags ahead of you moving in.

When you have a builder’s warranty or structural warranty that comes with the property, these policies usually give you 2 years from the property completion date to report more snags to the builder. After you move in, it’s important to document any defects you find with both written and photographic evidence from day one, so the builder can’t argue that you’re at fault for the damage.

A new build latent defects insurance policy, which is a type of 10-year structural warranty, can be an invaluable safety net if anything is missed off the snagging list. Not all defects are immediately noticeable, and some can take years to develop, long after the initial 2-year period expires. This is where the remaining 8 years of cover come in, easing the financial stress of repairing latent snags.

New build snag checklist: what to look out for

There are so many components in the construction of a house, but it’s necessary to check that every element has been implemented properly. Here’s a quick overview of what you should be inspecting:

  • Walls and ceilings – is plasterwork smooth and even, with neat finishing around sockets and pipes?
  • External brickwork – is it consistent in colour and placement, and free of chips and excess mortar?
  • Windows – is all glazing free of cracks, opening and closing properly with intact weather seals?
  • Doors – do all doors fit correctly within their frames, with working handles, hinges, locks, and bolts?
  • Floors – are all floors level and secured, with draught insulation and neatly finished skirting boards?
  • Staircases – do all stairs have level and stable treads, with secured balustrades and handrails?
  • Plumbing – do all taps, toilets, showers, washing machines etc work with a satisfactory water flow?
  • Heating – are boilers and radiators fitted safely, insulated appropriately, and working without leaks?
  • Electrics – are electrical outlets, fuse boxes, smoke alarms, and phone lines installed correctly?
  • Lighting – is there adequate lighting in all rooms, with uniformly fitted switches that all work?
  • Appliances – are any supplied appliances fitted and connected properly, with instruction manuals?
  • Fixtures and fittings – are sockets, faucets, kitchen units, curtains, carpets etc in good condition?
  • Paintwork – is every painted surface primed and finished evenly, with no splashes or exposed areas?
  • Pipework – are drains, downpipes, and gutters connected securely without leaks or blockages?
  • Roofs – is the roof sealed, insulated, and ventilated with secure flashing and no damaged tiles?
  • Gardens – if there is a garden, is the area free of construction debris and adequately landscaped?
  • Drives and pathways – are driveways and paths laid evenly with suitable gradients and materials?
  • Fences and gates – are the property boundaries completed with secure walls, fences, or gates?

Of course, this list is not exhaustive – and without prior experience in this area, you may not know what correct fittings should look like, or when a defect is minor and superficial or something serious.

How a structural warranty can help with snagging

As we’ve mentioned throughout, the easiest way to protect your financial investment in your new build house is to secure a structural warranty as early as possible. When you take out such a policy with a specialist provider like Architects Certificate, the key stage inspections can negate the need to carry out a separate snagging survey. Any problems will already be flagged in the regular reports.

Of course, you have the option of hiring a dedicated snagging surveyor, but this generates another bill, while you could take advantage of the reports included in the warranty you’re already paying for if you really wanted to create a new build snagging list. Additionally, you’d have to negotiate with the developer about snags yourself, whereas structural warranty claims give you some reassurance.

Do you think you could benefit from a new build structural warranty to help protect you against snags? Fill out our quick quote form online to receive your no-obligation quotation today, or contact our team with any enquiries by emailing info@architectscertificate.co.uk or calling 0161 928 8804.

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Published Date: 11th May 2022
Category: building warranty, Home warranty, structural warranty


 

13 
Apr

Signs of structural damage to look out for in your house

signs of structural defects
Whether your home is a new build or pre-owned, there’s the possibility of latent structural defects in every building. A structural defect is a fault that compromises the integrity of the structure – such as a damaged roof or foundation.

The majority of structural defects stem from negligent or deliberately poor quality construction work, but they often aren’t obvious. A latent defect can take a long time to develop, only becoming a serious problem, months or years down the line.

From cracks in walls to leaking roofs, it’s important to nip these defects in the bud before they get any worse. The longer you leave them to deteriorate, the more difficult and costly they’ll be to fix – and it could even cause parts of your house to collapse.

While the extent of structural faults may not be obvious or even visible straight away, there are still some tell-tale signs you can keep an eye out for. Here’s our quick guide to the causes and types of common structural defects, and how a building warranty can help you to avoid expensive home repairs.

What causes structural defects?

There are many possible causes of structural flaws, but they often start with defective design and workmanship. For example, an architect could make a mistake in their building plans, an engineer could make a miscalculation, or a contractor could purchase the wrong materials for the project.

Whether the plans are accurate or not, the construction workers can also be careless, either on purpose or by accident. Failing to follow proper procedures and installing things incorrectly can lead to countless issues, such as weak spots in the walls, uneven flooring, and unstable foundations.

Of course, all homes need to comply with building regulations for residences and local planning permissions, but any person or even several people can overlook an error at any point in the process. It’s also possible for this to happen later if you make further structural alterations.

This is just one reason why diligent structural inspections are important. When your property has a structural building warranty, part of the package involves a chartered surveyor inspecting the site at regular intervals during the build, which makes it more likely for mistakes to be discovered earlier.

Other frequent causes of latent structural defects include the following:

  • Subsidence – sinking movement due to loss of foundational support (e.g. dry soil shrinking)
  • Heave – shifting due to increased pressure from underneath (e.g. wet soil swelling)
  • Slope creep – slow and uneven downhill movement due to gradual landslips
  • Settlement – natural sinking as the structure compacts soil underneath (can be uniform, tipping at an angle, or differential with only part of the foundation dropping)
  • Water ingress – weakening from damp, mould, and rot caused by gaps in waterproofing

Improper ventilation and insulation can cause structural materials, like the mortar between bricks, to expand and contract with changing temperatures and airflow. This causes cracking and eventual destabilisation – as can climbing plants and invasive weeds, if they get a foothold in the masonry.

Signs of structural damage to your house

When you see your home every single day, you may not pay close attention to small changes. On the other hand, since you know what it’s supposed to be like, you might notice a defect right away when there’s a crack in the wall that shouldn’t be there or your windows won’t open properly anymore.

No matter if you’re a particularly observant person or not, you should periodically check both the inside and outside of your house for signs of structural damage. At least once a month or so, do a thorough visual inspection of the exterior and interiors to look out for the following problems:

  • Cracks in walls, around windows or door frames, or in masonry
  • Gaps where walls and floors should join due to warping/sagging
  • Tilting chimney stack or cracks in any part of the chimney
  • Slumping or buckling roof (weak or rotting beams/rafters)
  • Bowing walls that bulge or curve inwards, with or without cracks
  • Nails popping out of plaster/drywall from too much pressure
  • Windows and doors sticking in their frames from low settlement
  • Sloping floors and/or doors swinging open due to uneven subfloors
  • Migrating porch/front steps due to soil shrinking away from foundations 

These are just some of the most frequent visible signs of structural failure. While it’s normal to see small hairline cracks as a house settles over the years, large and long horizontal cracks and vertical cracks that follow a ‘staircase’ pattern are an urgent warning, as they’re signs of structural erosion.

If you notice the first hints of any of the above, don’t just ignore them or try to work around them. Filling in gaps, painting over cracks, and adjusting hinges won’t fix the underlying defects, which will only continue to get worse. It’s crucial to identify the source and tackle it promptly and completely.

What to do if you find a structural defect

The last thing any property owner wants is to discover a latent defect that requires expensive repair work. Even if the damage isn’t your fault, you’ll still have to foot the bill yourself if you don’t have a contract that holds the responsible parties liable – unless you have a structural warranty to rely on.

If you begin to notice signs that something is wrong with your structure, don’t brush them off. You could be putting yourself or others in danger – both physically and financially. The steps you’ll need to take depend on how long it’s been since the completion certificate was issued for the property.

When it’s been less than 2 years from the date of completion, you’re still in the defects insurance period. This means you should be able to report defects directly to the builder/contractor, who is obligated to conduct the necessary repairs during this time and recoup costs via their own insurance.

If it’s been more than 2 years, but less than 10 years, you’ll be in the remaining structural insurance period. During these 8 years, the policy only covers serious latent structural defects, and you must submit a claim through the provider – like ourselves at Architects Certificate – instead of contacting the builder. The terms of your warranty will specify which defects you can claim for and the amount.

What to do about defects if you don’t have a structural warranty

Unfortunately, without a structural building warranty in place, your options are limited and likely to be pricey. You can either pay for assessments and repairs yourself, or take the party you believe to be responsible to court (e.g. a builder or architect) – in which case, you’ll have to supply evidence proving their liability and negligence, and arrange legal representation, none of which will be cheap.

If you don’t have a building warranty to fall back on, you can still hire an expert to conduct a one-off structural inspection. They should be able to identify the defects and their probable causes, explain what must be done to fix them, and provide a report that can help you with organising repair work.

The sooner you uncover a defect and take action, the less money, time, and stress it should involve to put it right. If you are buying or selling a new property and need a structural warranty, or you already have a policy with us, you can get in touch with the ABC+ Warranty team on 0161 928 8804.

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Published Date: 13th April 2022
Category: building warranty, structural warranty


 

11 
Apr

Can you get a building warranty for a barn conversion?

While many first-time buyers prefer the reassurance of a brand-new building, lots of people want to live somewhere more unique than a ‘cookie-cutter’ development. For some, their dream home is a self-build from the ground up, but for others, it’s an existing structure renovated into a residence.

With land at a premium, it makes sense to look for existing properties to upgrade, which is why conversions are popular. Common examples include department stores turned into apartments, and disused churches and barns transformed into avant-garde businesses or private accommodation.

However, the issue with converting an older building is that it’s unlikely to have a current structural warranty, but it is likely to have some structural problems. They won’t necessarily be latent defects originating from poor construction, but the older a building is, the more wear and tear it will have endured over the years.

So, is it possible to get a new structural warranty for a barn conversion? This blog explores some of your barn conversion warranty options, answering common questions about why it’s better to have a structural warranty for your barn conversion project and how to set one up. 

What counts as a barn conversion?

A converted barn is an agricultural structure that has been renovated for another use, whether that’s domestic or commercial. Originally used as storage for farming equipment and housing for livestock, barns are typically found in rural areas, making them ideal to convert into rustic homes or quirky businesses. Barn conversions have been known to become restaurants, offices, and more.

Developers and individuals are often on the lookout for modifiable buildings with a unique selling point, and an idyllic adapted barn fits the bill. While other structures such as cow sheds can also be converted into dwellings, a disused barn is more likely to have desirable architectural features, like:

  • Double doors and lots of windows
  • Vaulted ceilings with exposed beams
  • Double-height rooms/mezzanine floors
  • Open-plan layouts suitable for modern living

Convertible barns are solid structures with plenty of space inside, usually in a prime countryside location. However, the aesthetics and the views won’t matter if the structure is unusable. You need to consider the materials used for the barn’s construction, such as timber or stone, and the age of the structure and degree of deterioration. The type of structure is also important, as it could be:

  • Box construction (four walls to support the whole structure)
  • Cruck frame (internal A-frames to support roof and walls)
  • Post and truss (internal frames to support roof joined with vertical posts)

These are the most common barn types, but whichever construction method was used, and whether it’s a stone barn or a timber barn, converting it into a dwelling in line with building regulations is likely to take a lot of time, effort, and money. After all, an unused barn probably has no plumbing or electrical wiring, and little insulation, which are all basic requirements for a liveable modern home. 

Can you get a barn conversion structural warranty?

Yes, you can. It may not be as straightforward as getting a new build warranty, but it’s possible. The difficult part is finding a provider who doesn’t perceive a barn conversion to be a risky investment. Barn conversion insurance is a small market, with few lenders willing to take those financial risks.

As a large-scale project, with an older structure and lots of installations and restorations involved, there is a greater potential for structural defects to occur than if you were building a barn-style home from scratch. Therefore, if you do secure a warranty, it will require much more exhaustive and frequent assessments before and during the development, and probably paying higher premiums.

Ideally, the cover for your barn conversion project should follow a similar format to the standard structural warranty. This would include an initial defects insurance period of two years, then a structural insurance period of eight years. Those first two years hold the builders or contractors accountable for fixing construction issues, while the remainder covers major structural defects only.

During this secondary period of cover, you would have to claim for repair costs directly through the warranty provider, who would pay for a significant portion of the necessary works if your claim was successful. Since the kinds of structural defects that might occur in a barn conversion can be very different from a regular house, it’s crucial to set up a bespoke barn conversion warranty early on.

Does a barn conversion really need a building warranty?

Since structural warranties aren’t legally required, even for converting old buildings, some people believe it’s a skippable expense. However, doing so could get you into hot water later on, especially if you aren’t self-funding the project. Most banks refuse to lend to self-builders without adequate insurance, because they risk losing their money if the structure develops defects that need repairing.

Even if you are putting up the money for the barn conversion completely by yourself, you should want to protect that investment even more. If anything goes wrong with the design or construction, but the defect isn’t evident until later, what will you do? Do you want to be left footing the repair bill yourself, too? Or paying to take third parties to court and provide evidence of their negligence?

Having a barn conversion structural warranty to fall back on is a much more convenient option. This not only gives you some peace of mind, but also makes the property more attractive to tenants or buyers if you plan to rent or sell the completed barn conversion. Overall, with a structural warranty to help cover the costs of latent structural defects, there’s simply less hassle and stress to deal with.

There are so many factors associated with converting a barn that it would make no financial sense to see it all wasted because of other people’s errors. Don’t make the mistake of skipping a structural warranty to try and save money, because it will cost a lot more in the long run to fix latent defects.

How can you get a barn conversion warranty?

If you’re currently on the hunt for a barn conversion warranty, then you’re in luck. At Architects Certificate, we offer an adjustable ABC+ Warranty that can provide latent defects cover for a variety of building types. While insuring barn conversions can be tricky, we’re always up to the challenge.

For the best chance of securing coverage and an agreeable quote, start the application process as soon as possible – around 6 weeks before any work starts, at least. Preparing all the documents in advance will also help if you’ll be applying for a bank loan or mortgage. You’ll need to provide:

  • Site plans (including drawings, specifications, and location details for the whole site)
  • Structural report (listing condition details, ground levels, and conversion suitability)
  • Photographs (full-colour pictures of the interior, exterior, and surroundings)
  • Waterproof envelope (existing damp-proofing materials and proposed waterproofing)
  • Ground investigation report (explaining ground quality, soil strength, contamination, etc)
  • Valuations (of the existing structure and planned development once completed)
  • Design/construction contracts (specifying building works, timelines, and estimated costs)

The more thorough your supporting evidence, the better your chances of getting a favourable contract. To find out more about how Architects Certificate can help you or to request a barn conversion warranty quote, you can fill out and submit our online application form or call us on 0161 928 8804.

Our chartered surveyors are experts in carrying out thorough structural assessments, and can provide detailed reports on the condition of the structure. To see some examples of the kinds of building conversions we’ve worked with before, take a look at our gallery of previous projects.

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Published Date: 11th April 2022
Category: ABC+ warranty, building warranty, structural warranty, warranty enquiries


 

04 
Apr

What kind of construction defects does a new build warranty cover?

new build construction defects

When purchasing a new house, it’s usually the responsibility of the buyer or their representative to make sure it’s structurally sound. This often involves hiring a qualified surveyor to carry out an inspection of the property before completion, or multiple inspections throughout construction.

Unfortunately, every construction project carries the risk of defects occurring. Even the most diligent of designers, architects, and construction workers can make mistakes sometimes, whether that’s failing to complete a task to the adequate standards or not recognising a defect during the project.

This is why the developer and/or seller should have some kind of policy to ensure that the property isn’t misrepresented to the buyer, and that if any defects are discovered, the appropriate insurance can help to cover the repair costs. Typically, there should be a relevant structural warranty in place.

Buying a new home can be stressful enough without having to worry about structural defects. So, if you’re in the housing market and want to be prepared, this blog addresses the important questions – what exactly is a structural defect, and who is responsible for them under a new build warranty?

What is a construction defect?

A structural defect, also known as a construction defect, is part of the work that doesn’t meet the specifications set out in the contract and/or construction law. There are many types of defects, but structural defects tend to result from faults in the design, materials, or quality of construction work.

Examples include workers using the wrong materials, installing elements in the wrong order, or laying foundations or load-bearing walls that aren’t strong enough. Mistakes like these can lead to further issues like breaches of planning permissions, cracking foundations, or even total collapse.

In extreme cases, hidden defects can gradually worsen until windows and doors get stuck or break, roofs or floors cave in, or walls crumble. The longer it takes to notice or address the fault, the more expensive it’s likely to be to fix it – if it’s possible to repair the structure rather than write it off.

When facing the possibility of structural defects in your new build home, it’s best to have an expert such as a chartered surveyor on your side, who can help you to identify problems before they get to that point. They can also make the important distinction between patent defects and latent defects.

What is a patent structural defect?

In construction, a patent defect is an easily recognisable fault that can be picked up early in the process. This could be during the building works, or within a limited period following completion of the structure. If anyone involved identifies an ‘observable’ defect during this time, whether it’s the workers themselves or a third party inspector, then the contractor is responsible for fixing them.

These surface defects are often referred to as snags; the client or their representative will usually do a walk-through at the end of construction and draw up a snagging list of visible defects. The seller and contractor should rectify these issues before the buyer completes the purchase and moves in.

Patent defects are more straightforward to take care of. Since they’re generally obvious to the eye, people can pick up on them quickly and resolve them before they become more substantial. They’re also likely to be discovered sooner, meaning they can often be corrected before the build is finished.

What is a latent structural defect?

By contrast, latent defects are not immediately detectable. A latent defect can either be concealed or not yet developed, and can take weeks, months, or even years to become apparent. These are more serious for the homebuyer, as the issue tends to be severe by the time there are visible signs.

For example, it may not be possible to assess a defective foundation after completion, and shifting of the ground and subsequent movement of the structure can happen so slowly that nobody notices until the building is sinking or the walls are cracking. Similarly, once all the plastering and laying of floorboards is done, it can be difficult to assess the load-bearing elements for potential defects.

Since they aren’t usually identified during construction or even the first few years after completion, latent defects can be more difficult to resolve. Depending on when the defect becomes known, the original developers and builders may no longer have a contractual obligation to rectify it for you.

Who is liable for structural defects?

The responsibility for new build defects, or structural defects of any kinds, depends on the contracts for the works and the insurance policies of the parties involved. Accountability can be a grey area, especially for latent defects, as it can be difficult to determine who was at fault years afterwards.

Catching patent defects early is preferable, as it’s easier to identify the responsible party, and they will likely be obligated to fix the problems in line with the specifications of the ongoing contract. On the other hand, if a latent defect develops down the line, taking corrective action can be complex.

Firstly, determining the extent of the damage and who is at fault for the flaw (architect, designer, builder, contractor, etc), and whether they are still contractually bound to rectify defects, is an onerous process. Secondly, legal liability often depends on the terms of your property’s structural warranty. If you don’t have one, or a specific liability period has passed, you could be in trouble.

How can a homeowner seek redress for new build defects?

The best way to protect yourself against potential structural defects is to make sure that a new build warranty is already in place before you finalise the sale, and that you’re happy with the terms. Generally, the protections of a structural warranty don’t kick in until the date of completion, but some warranties can also cover you if the developer or seller goes out of business before completing the build.

If a patent defect is discovered during construction, you’re likely to be covered by the building contract itself, as they legally must meet certain specifications in order to fulfil the contract. It will also be difficult to get a certificate of completion if defects and other snags aren’t rectified first.

However, if you pick up on a defect after practical completion, you may only be able to contact the contractor about it if this happens within the first two years. This is the defects insurance period of a structural warranty, during which you can report any problems with the completed work for fixing.

After this (two years from the date on the completion certificate), the next part of the new build warranty kicks in, which is the structural insurance period. This tends to last for eight years, as the remainder of what is usually a ten-year policy. During this time, if a latent defect arises, you can no longer contact the seller or builder. Instead, you must claim the costs directly through the warranty provider.

Depending on the scale and type of defect, the warranty may only pay for partial repair expenses, or none at all if the value is below a certain amount. While you can claim for a variety of problems with the home during the first two years, the following structural insurance period only covers serious structural defects.

How can buyers protect themselves against defective new builds?

As a property buyer, you have several choices. Often, the easiest route is to take on the seller’s own structural warranty, which they should have set up before beginning construction work on your new build. You may be able to adjust the contract terms after consulting with the seller and the provider.

Since it isn’t actually a legal requirement to have a new build warranty, you should make sure to set one up yourself as soon as possible if the developer hasn’t yet. The more the warranty provider’s chartered surveyors can inspect the build throughout, the less likely it is for defects to go unnoticed.

Alternatively, as extra security on top of your latent defects insurance, you could ask the developer about a collateral warranty. This would extend their original construction contract to include you as a third party, creating a direct legal link that should theoretically make it easier to handle defects.

If you’re looking for a new build structural warranty, why not try the ABC+ Warranty quick quote form? Here at Architects Certificate, we provide a range of structural warranties to suit a variety of construction projects, with expert structural assessments included in our many services. For more information, give our team a call on 0161 928 8804 or email us at info@architectscertificate.co.uk today.

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Published Date: 4th April 2022
Category: ABC+ warranty, building warranty, structural warranty


 

11 
Mar

What’s the difference between a building warranty and home insurance?

home insurance building warranty

Both building warranties and home insurance protect the owner’s bank account against costly repairs, but what’s the difference in their coverage? Do you really need both at the same time?

It’s understandable to want to save money by only buying the best insurance product, but you won’t be covering all the bases if you choose one over the other. Let’s look into what these policies are and why investing in both a building warranty and home insurance offers the best financial protection.

What is a building warranty?

A building warranty, structural warranty, or home warranty is a type of insurance policy taken out on a new build. The developer or builder responsible for the project usually sets up the warranty before construction starts, then transfers the policy to the new owner when they buy the property.

This is also known as latent defects insurance, because it protects the policyholder against latent structural defects. In the several years after the build is completed and settles, problems with the structure might develop, caused by defective design, materials, or workmanship during construction.

The structural warranty should cover the expense of repairs or replacement materials, giving the property owner peace of mind that they won’t be out of pocket for a problem that wasn’t their fault. These warranties can apply to new build homes, commercial properties, self-builds, and more.

What is home insurance?

Whereas the property developer is initially responsible for a building warranty, it’s the responsibility of the buyer to ensure they have personal insurance for their new residence or business insurance for their new premises. Home insurance covers your property against other types of damage to the building and your belongings, which the latent defects warranty doesn’t as a structure-only policy.

This includes events like vandalism and theft, fire and smoke, and weather damage (e.g. flooding from heavy rain or falling trees from high winds). You can purchase separate policies for building insurance (applying to the building itself) or contents insurance (applying to your possessions only), or opt for an inclusive home insurance policy that rolls both types of coverage into one contract.

Home insurance may also cover you for legal expenses in the case of a third-party injury claim on your property. Standard coverage will normally exclude circumstances like extreme natural disasters.

Why do I need a structural warranty if I have home insurance?

As you can see, these insurance types cover different risks, so you’ll be leaving yourself open to more liabilities if you only have one of them and not the other. If you would prefer full protection for damage to the structure, the building as a whole, and everything inside it, then you’ll need both.

If that isn’t reason enough, financial lenders will also expect you to have a structural warranty and home insurance set up before you apply for a mortgage. Since they’ll be paying for part of the property upfront, mortgage providers are unlikely to take the risk on an unprotected investment.

If you’re in need of a structural warranty for any type of building project, why not contact Architects Certificate to get a no-obligation quote? We may not provide home insurance here, but we do offer bespoke building warranties, so call us on 01619 288 804 or email info@architectscertificate.co.uk.

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Published Date: 11th March 2022
Category: ABC+ warranty, building warranty, Home warranty, structural warranty


 

25 
Feb

How a new build warranty could protect you from dodgy developers

new build warranty dodgy developers

Many people prefer to buy a newly built home rather than an older pre-used building for lots of reasons. These include the fact that pre-owned homes older than 10 years are unlikely to have a structural warranty, whereas a new build should come with one.

Even if the builder doesn’t make the most of modern technologies and exceed building standards, having the new build warranty included in the property purchase means you’ll be covered against latent structural defects if an issue develops in your new home.

While most new build homes have a structural warranty that promises peace of mind, this isn’t always the case. Unfortunately, the media has been flooded with new build horror stories in recent years – we’re sure you’ve seen a fair few exposés on unscrupulous developers.

So, why is it necessary to have a new build warranty in place before you buy and move in? What happens if you don’t have one? If you have a structural warranty and discover a defect, what should you do to resolve it? We answer all these questions and more in this blog.

What are the common problems with new build homes?

Britain’s new build scandal has been widely reported on. According to statistics gathered by This is Money, a shocking 94% of new build homeowners discover at least one defect after completion, while 42% report finding more than ten. The average new build property now comes with around 157 ‘snags’ in varying levels of severity.

Even the biggest developers in the UK have been caught cutting corners, as builders are pressured to complete projects quickly, resulting in rushed and shoddy workmanship compromising the quality and integrity of the structures.

Here are examples of common structural defects found in new build homes across the UK:

  • Improperly fitted windows and doors (allowing heat to escape, making it difficult to open, close, or lock them properly, etc)
  • Unconnected or poorly fitted vents (e.g. ducts to tile vents in the roof, window trickle vents)
  • Missing, incomplete, or incorrectly installed loft insulation
  • Inconsistent sealant allowing water ingress (leading to condensation, damp, and mould)
  • Unsecured or blocked gutters (causing rainwater to build up on the roof)
  • Crumbling mortar or gaps between bricks (non-uniform brickwork pointing)
  • Bowing, cracking, or sloping walls or floors
  • Incomplete or faulty electrical wiring or plumbing (e.g. unsecured sockets, leaking pipes)
  • Screws or nails popping out of walls, floorboards, or stairs
  • Excessively creaking or squeaking floorboards, doors, or windows
  • Bad plastering and/or messy and peeling paintwork
  • Poor drainage in garden or driveway (causing muddy/boggy ground)
  • Loose fittings (e.g. hinges, handles, taps, radiators, appliances)
  • Unstable exterior boundary walls, fences, or gates

As you can see, there are a lot of potential issues that might not be apparent at first glance. Even if you notice something small initially, like hairline cracks in the plaster, it could be a sign of a more serious underlying problem that could get significantly worse over time.

After all, if something as simple and easy as fitting a door hasn’t been done properly, what else might they have bungled or missed completely? Without a chartered surveyor monitoring the build and the ongoing protection of a structural warranty, you could be left to foot the bill for fixing an extensive list of problems like these by yourself.

Does a new build warranty cover you before completion?

Yes – as long as there’s a new build warranty in place that specifically covers the buyer in the event of builder insolvency. When this is included in the contract, you should be able to at least recover your deposit if the builder goes out of business without completing your new home.

Depending on the specific terms your policy offers, this stage of a structural warranty should cover ‘reasonable costs’ – including recovering any payments to the builder and the necessary work to complete the remainder of the build to its original specifications.

To make a successful warranty claim if your builder/developer becomes insolvent, you must have had grounds to believe they were able to fulfil the contract. If you had prior knowledge of pending insolvency or doubts at the time of signing the contract, it could invalidate this part of the warranty.

As a back-up for your new build warranty, you should also check that your builder or developer is signed up to the Consumer Code for New Homes or the Consumer Code for Home Builders. This ensures minimum standards of quality, customer service, and after-sales support. It also allows you to access a low-cost independent dispute resolution service to handle complaints impartially.

Will a structural warranty survey help with snagging?

One of the biggest security nets offered by obtaining a structural warranty at the start is having expert surveyors on your side to identify snags. Even with the best properties and construction teams, you can expect a ‘snagging list’ of some kind.

When the property is finished, you should be invited to look around and point out any issues you want the builder to fix before you move in – but you may not know what you should be looking for. In the case of latent defects, they might not be noticeable until much later.

When your structural warranty provider carries out key stage inspections, they’ll be knowledgeable enough about industry standards to spot even the smallest variations. This means they can notify the builder of things they need to rectify before they go any further.

By contrast, if you wait until after completion, it can cost more and take longer to correct errors.  You may also have to pay out of pocket for a post-completion survey to get an official report on the various ‘snags’ present in your supposedly finished property.

When you have a new build structural warranty from the beginning of construction, which the builder or developer should have set up and passed on to you as the buyer, the warranty provider should carry out structural surveys as part of the service.

It’s best to entrust this process to the professionals, who know exactly what to look for inside and out, from walls and roofs to fixtures and fittings. The earlier you do this, the lower the risks should be of serious latent defects developing down the line.

How does a new build warranty work after completion?

While most new build warranties will also cover the buyer against the builder becoming insolvent during the build, the main part of the 10-year structural warranty kicks in from the date of issue on the property’s completion certificate.

As you may know, the first 2 years are the defects insurance period, wherein the builder is obliged to come and fix any problems with their work if you contact them about outstanding repairs. This may not include cosmetic or decorative issues like tiling or carpeting.

From the end of the second year onwards, the final 8 years are the structural insurance period. During this time, the builder is only responsible for rectifying major structural defects, and the warranty provider usually pays for the repairs when you make a successful claim.

Examples of what a successful structural warranty claim might pay out for include problems with:

  • Foundations
  • Roofs and ceilings
  • Chimneys and flues
  • External rendering
  • Windows and doors
  • Load-bearing walls and floors
  • Staircases and decking
  • Below-ground drainage
  • Plumbing and electrical wiring

On the other hand, these are examples of ‘minor’ issues that your warranty isn’t likely to pay for:

  • Natural wear and tear over time
  • Unrelated weather damage
  • Maintenance failures that you’re responsible for
  • Floor coverings and fixings (e.g. tiles and grout, ill-fitted carpets)
  • Cracking or flaking that doesn’t affect structural integrity
  • Condensation, damp, or flooding that doesn’t affect structural integrity
  • Staining, fading, or other discolouration of finishes
  • Solar panels or sound insulation

Additionally, there will be a minimum and maximum claim value. The provider will calculate the appropriate expenses for necessary repairs, and usually won’t pay more or less than the exact cost of the required remedial work. Of course, you may have to pay an excess per claim.

This is why it’s important to check the builder’s warranty before they pass it on to you, and request to change providers if their policy doesn’t include the cover that you expect. Always check the terms and conditions and the policy schedule before agreeing to the contract.

What can you do if there is a problem with your new build home?

If you don’t have a structural warranty, and you find a defect in your home, you have two expensive choices. First, you can save time and sort out repairs yourself with your own money. Second, you can take the builder/developer to court and try to prove they’re at fault for the defects.

Neither of these are attractive options for new homebuyers who have just set up a mortgage. If you did the smart thing and ensured you had a new build warranty, then you can check your paperwork and follow the steps directed in the policy.

If you notice a structural issue within the first 2 years after completion – not 2 years from your move-in date, unless it was the same day as the completion certificate was issued – then you should contact the builder or developer responsible for your property directly.

When you contact them, be sure to keep a record of all communications and agreements. These will provide supporting evidence if the builder refuses to do the work, leaving you to take your complaint to a dispute resolution scheme or your warranty provider.

From the start of the third year, the builder’s responsibilities are reduced, and it can be harder to get them to respond to your complaints in a timely manner, if at all. If the problem has a significant repair cost attached, it’s best to bypass the builder and make a claim with the policy provider.

Unfortunately, once your structural warranty expires at the 10-year mark, you won’t be able to claim on latent defects that appear more than a decade later. You’ll have to rely on your own building insurance policy, which may not offer the same extent of financial protection.

Where can you get a new build structural warranty?

Since a structural warranty isn’t technically a legal requirement, not all builders or developers even bother to get one. You should always check before agreeing to a sale.

If you’re a buyer in need of a new build structural warranty, or you’re building your own home and require a self-build structural warranty, we can help to make sure you aren’t being short-changed by a dodgy deal.

The ABC+ Structural Warranty available from Architects Certificate can be tailored to a range of property types. You can find out more about this kind of policy in our new build warranty guide, or get in touch to discuss our structural warranties with our team.

Call us on 0161 928 8804, send us an email at info@architectscertificate.co.uk, or fill out our online application form for a quick quote today.

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Published Date: 25th February 2022
Category: ABC+ warranty, building warranty, structural warranty


 

31 
Jan

Can you get a retrospective warranty for a completed house?

completed house structural warranty

Whichever type of property your development may be, structural warranties are essential if you want to protect your investment. It’s best to have such a warranty in place before construction even begins, but here at Architects Certificate, we know that isn’t always possible.

This leaves many homebuyers wondering: can you get a retrospective structural warranty after completion? If construction has already finished and you’re looking for the answer to this question yourself, have a read through our completed house warranty blog below.

Is a retrospective PCC the same thing as a structural warranty?

Though you may have heard of a retrospective Professional Consultants Certificate (PCC), these aren’t the same thing as a retrospective structural warranty. If you want a higher level of financial protection, you should opt for a 10-year structural warranty rather than a 6-year PCC.

Not only does a PCC have a shorter period of cover, but it also doesn’t guarantee compensation in the event of a structural defect. You’ll have to go to court and prove that the builder, developer, or architect is at fault. However, a structural defects warranty allows you to make a direct claim.

You can have both a PCC and a structural warranty at the same time, with concurrent periods of cover, but this isn’t really necessary. If you want to save money upfront, a PCC will be cheaper – and you can always apply to upgrade it to a structural warranty later if you want further coverage.

How is a completed house warranty different?

A completed house warranty is more of a generic term that can apply to either a retrospective PCC or a retrospective structural defects warranty. It depends on the type of cover that you choose to apply for. In any case, the same legal limitations apply to both types of architects’ certificate.

The issue with leaving your application until after the building is already finished is that the warranty provider won’t be able to carry out progressive inspections throughout the duration of the build. There will normally be at least six inspections from the start of the project to completion.

If it’s only possible to perform one post-completion survey, and the surveyor finds any structural problems at this stage, it may be too late to address them – at least not without even more work and increasing expenses. They cannot issue a completed house warranty if it fails this survey.

How does a completed property warranty work?

The limitation of a post-completion warranty is that the Council of Mortgage Lenders (CML), now UK Finance, only allow providers to issue these warranties retrospectively if the contract doesn’t vary from the original CML-prescribed terms.

This means you cannot change the wording, so the level of liability won’t change, either. The warranty will exist and be enforceable as though the property was inspected from the very start, holding the contracted parties liable from the outset.

Since a full building condition survey after completion must be much more intensive, and the provider is accepting a higher degree of risk, a retrospective warranty will also come with higher costs than if you engaged their services at the beginning or even partway through.

If your completed house fails to comply with the required technical standards, you won’t be able to get a warranty. Even if the property passes the inspection well, your contract will apply from the actual date of completion, not the later date when the certificate is issued.

In summary, a completed house warranty will apply in exactly the same way as an original PCC or structural defects warranty would. For this reason, it’s not actually possible to get a retrospective architects’ certificate that applies from a date beyond the building completion.

Get a quote for a completed house warranty today

Now you know all about structural warranties for completed houses, why not contact us to request a completed house warranty quote? As providers of Professional Consultants’ Certificates and structural warranties for all types of properties, the Architects Certificate team could help you.

Whether you just want the peace of mind that your home is as financially protected as possible, or you’re completing home renovations and need a new warranty, we can supply transferable certificates for eligible properties. Call 0161 928 8804 or email info@architectscertificate.co.uk for more details.

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Published Date: 31st January 2022
Category: ABC+ warranty, building warranty, Home warranty, retrospective certificate, structural warranty


 

17 
Nov

How do stage payments work for self-builds?

self build stage payments

Self-build mortgages and stage payments

Searching for the right property can be a long and stressful process. Even when a particular home seems promising, you’ll probably find that your location, design, and price ideals rarely align.

The alternative is to build your own home instead of buying a pre-built property. This allows you to tailor every aspect to your personal needs and preferences – with guidance from the experts.

You could try to do most of it yourself (if you have the experience and qualifications to carry out building work). Or, you could hire an architect and builders to take care of things for you.

The last option, for those who want a hands-off experience, is hiring a contractor to sort everything out on your behalf. However, this approach is obviously going to be more expensive.

Whichever self-build route you take, it’s likely that you’ll need a mortgage to finance the project. After all, most of us don’t have the funds to build an entire house just sitting around.

Standard mortgages are for newly-built properties, so you’ll need a specialist mortgage. Let’s take a look into stage payment mortgages and how they can help you to self-build your dream home.

What is a stage payment mortgage?

Banks tend to release standard mortgage funds once a property sale completes.. Mortgages for self-builds are different. They release payments in instalments instead of a lump sum, across multiple stages of the building process.

This type of mortgage allows you to borrow money to buy land to build on first, then pay for the construction in stages as it progresses. It’s helpful for managing cashflow if you don’t have the funds to pay for the project upfront yourself.

Since it’s a specialist loan, there are fewer providers to choose from than for standard mortgages. The stage payments reduce the lender’s risk, as there’s more room for error with self-builds if they aren’t managed properly.

What types of self-build mortgages are there?

There are typically two self-build or stage payment mortgages available: advance and arrears.

Advance mortgages allow you to draw the funds ahead of each stage to fund each part of the project. They usually cover up to 75% of the value, so the deposit will be around 25%.

Arrears mortgages only release payments after the completion of each stage. This means you have to fund each stage yourself first, then the mortgage instalments will essentially repay you. You’ll also have to pay a larger deposit of up to 50%, as this type covers less of the value.

Self-build mortgage loan amounts depend on whether they’re cost-based or valuation-based. This means the stage payments are based on either a portion of the project costs or the value of the project at each stage – usually, whichever is lower.

How much are self-build mortgages?

Each potential lender will assess your financial circumstances (income, outgoings, and debts) and your project planning to establish how much they want to lend you. The more prepared you are, with accurate cost projections, the more likely they are to approve your self-build loan.

Interest rates for these mortgages are higher than standard rates due to the higher risk involved for the lender. They tend to be around 4-6% per annum. However, some lenders will reduce the interest rate later in the build when the property is habitable.

Depending on the lender and particular mortgage, you may be ‘tied in’ to this loan for 1-3 years. Self-build homes typically take at least a year to complete. Once you have a Building Control Completion Certificate, you may be able to switch to lower interest.

Why choose a self-build mortgage?

There are many advantages to self-build mortgages. They enable you to make regular payments to your contractor or purchase materials as needed. Since you only take an instalment, this keeps your monthly interest payments lower than if you had to pay interest on the total amount from day 1.

Of course, the main draw of these mortgages is that they enable you to design your ideal home. Rather than buying a new build in a cookie-cutter development, you can customise everything exactly how you want it. The final product often has a higher property value than it costs to build.

The higher deposits and interest rates are the main downside, as you still have to cover your living costs elsewhere throughout the build. It also requires much more paperwork in preparation. You need planning permission and project cost evaluations ready before you can even apply.

On the plus side, there’s the potential of saving thousands of pounds in Stamp Duty. While this tax has increased when buying completed builds, you can get around this with a self-build. You’ll only have to pay Stamp Duty on the land that you bought to build your home on, not the building itself.

How do stage payment mortgages work?

Understandably, you want to know when you’ll receive the mortgage payments. The lender will normally only release the stage payments after receiving a satisfactory report at each stage. Your supervising architect or the lender’s property valuer will complete regular inspections.

Many lenders won’t offer a mortgage on a land purchase only, and will only release the first payment once the foundations have been laid and inspected. The regular inspections will allow the lender to monitor your progress, and ensure you’re staying on track with the project plan.

Most banks will permit Architect’s Certificates as proof of the status of a building project in order to release the funds. Prior to the final payment, you must provide a copy of a Professional Consultant’s Certificate (PCC) to confirm the property’s completion.

When are the stage payments released?

The key stages for self-build mortgage instalments may vary according to the lender, but they tend to follow this pattern:

  • Purchase of land (with planning permission outline)
  • Substructure completion (site clearance and foundations)
  • Building of load-bearing elements (wall plates, floor joists, roof trusses)
  • Wind and watertight proofing (completed external walls, roofs, windows)
  • First fix (ventilation, plumbing, electrical wiring, internal joinery)
  • Second fix (plastering, final fittings and connections for the above)
  • Certified completion (with a Professional Consultant’s Certificate)

These can vary according to the type of build, as ‘brick and block’ construction is different to timber frame construction. Renovations, such as barn conversions, are also completely different to self-builds from the ground up on empty land.

What do I need to apply for a self-build mortgage?

Self-build mortgage criteria will vary from lender to lender, so you’ll need to double-check their specific requirements before applying. Some require working to a fixed budget, and you may have to include contingency costs of up to 20% in your build cost estimates.

The criteria usually depend on the build type and location, but you will obviously need to comply with current Building Regulations at all times. You’ll need to identify or estimate the costs for:

  • Purchasing the land
  • Obtaining planning permission
  • Project management (e.g. health and safety compliance)
  • Site preparation (e.g. demolition, landscaping)
  • Architectural design fees
  • Construction costs (based on drawing specifications)

When applying for the mortgage, you’ll need to provide copies of the relevant documentation. This includes fixed-price contracts for architect’s and builder’s work, if applicable. The bank can take up to 3 months to process this while they investigate your paperwork and finances.

You must be able to prove that the construction project is registered with the HB47 Scheme, or that it will be supervised from start to finish by a qualified architect or building surveyor. In the latter case, they must have certification for adequate professional indemnity insurance.

You’ll also need an appropriate building insurance policy and structural warranty. Please be aware that these are not the same thing, and banks usually require prospective borrowers to have both in place. These legal protections should give you peace of mind, as well as the lender.

Contact us for Stage Payment Certificates

When you take out a self-build loan, the lender will expect an initial evaluation at the beginning, interim evaluations throughout the project, and a final evaluation on completion. To prove to the bank that everything is proceeding as planned, you’ll need Stage Payment Certificates.

Also known as interim certificates, or pay as you build’ certificates, you won’t be able to receive the funds and pay contractors without them. Luckily, the ABC+ Warranty team at Architects Certificate can provide these all-important documents for your self-build project.

Simply get in touch and we can ensure that due diligence is done for your self-build construction. You can call us on 0161 928 8804 or send enquiries via email to info@architectscertificate.co.uk. We’ll be happy to advise you on Stage Payment Certificates for your project.

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Published Date: 17th November 2021
Category: ABC+ warranty, architects certificates, building warranty, self build checklist, self building first time buyers, structural warranty
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