Build-Zone Warranty not recognised.

[Silver Birch]

I built a detached bungalow in West London in 2012 which my wife and I live in. We have a Build-Zone 10 year Warranty on the bungalow with around 18 months to run. More importantly, the warranty is recognised by 120 Banks/Lenders for people applying for a mortgage. The list includes virtually every big Bank in the U.K. Lloyds, Barclays, R.B.S. Halifax, you name it and it's on the list. 

We have now decided to sell the bungalow and move out of London and we have found a buyer and are at an advanced stage of the sale (searches and surveys have all been done). Last week we received an email from our buyer saying that the mortgage survey did not throw up any issues but the Bank ( an Indian Bank but I'm not sure which Indian Bank) has said that it does not recognise the Build-Zone Warranty as a standalone Warranty and will only proceed if we get a PCC (Professional Consultants Certificate). Our buyer thinks we can magic a PCC out of thin air. I ended up contacting the Company who has found our buyer the mortgage and managed to speak to a Broker who pointed out that even if I paid for a PCC (£2,000 upwards) there is no guarantee that the Indian Bank would give our buyer the mortgage he's applied for. The PCC would be just one of several factors in obtaining a mortgage.

Although we are keen to sell (we have had an offer accepted on a house in Camberley) I am confused as to why the Indian Bank will not recognise Build-Zone Warranties and would have thought that it's the buyers responsibility to secure a mortgage.

I would really appreciate any feedback (positive or negative) on what Forum members might think.

[nod]

You have three choices 

Pay for the PCC 

Or the buyer pays 

Or find another buyer 

I would think the vast majority of lenders will accept what you already have 

[pdf27]

6 hours ago, Silver Birch said:

I ended up contacting the Company who has found our buyer the mortgage and managed to speak to a Broker who pointed out that even if I paid for a PCC (£2,000 upwards) there is no guarantee that the Indian Bank would give our buyer the mortgage he's applied for. The PCC would be just one of several factors in obtaining a mortgage.

This sounds seriously shady to me - as in, I wouldn't be confident that this buyer would ever get the mortgage they've applied for. Have they got a seriously good reason for applying for a mortgage from an Indian bank on a UK property?

[Russell griffiths]

I don’t see how this is your problem, you have supplied all the correct stuff if their bank doesn’t like it that’s their problem. 

I understand the frustration, but dealing with theses people is on another level of dodgy. 

Keep the house on the market and keep showing it. 

If they are having this problem then it will probably fall apart later on anyway. 

[Temp]

Not all lenders recognise all warranties. The Council of Mortgage Lenders used to have a database. I think the CML is now part of UK Finance a new trade body.

 

Perhaps suggest the buyer go back to his lender and ask if he can take out a PCC? Or try another lender?

 

 

 

 

Edited December 15, 2020 by Temp

[PeterW]

Ok so ... the buyer may be using an Indian bank such as SBI (State Bank of India) as they do a lot of buy to let loans and also recognise non UK investments and securities for parts of mortgages. They also could be using an Islamic Sharia mortgage as under Islamic tradition interest cannot be charged.
 

There are plenty of reasons as to why this may be the case, but I would speak to your buyer and tell them if they want a PCC then it’s their cost to obtain it. 

[SuperJohnG]

On 15/12/2020 at 10:29, PeterW said:

Islamic Sharia mortgage as under Islamic tradition interest cannot be charged

How do i get one of these??!

 

 

[Temp]

They call it rent rather than interest..

 

https://www.unbiased.co.uk/life/homes-property/what-is-an-islamic-mortgage-and-how-do-they-work

 

"Sharia-compliant mortgages are really ‘mortgage alternatives’ and function as no-interest home purchase plans. Though there are several variations across the market, all work in the same basic way: the bank buys the property on your behalf and becomes the legal owner. Your monthly payments function more like rent, with a portion going towards buying out the property owner’s stake. At the end of the term you should either have bought the property back, or have an outstanding sum left to settle before you become the legal owner."

 

Continues..

 

Edited January 5, 2021 by Temp