Bridging Loans News:- Giving house buyers compensation if their new home is badly built has received support from smaller developers.
The Federation of Master Builders, FMB, said it was right the new homes ombudsman would be backed up by law. The trade body called for SME builders to be central for developing the scheme and new code of practice.
FMB chief executive, Brian Berry, said: “The details of this sensible step are still to be worked out, and the SME building industry must be central in the process as the funding, standards, and delivery model are decided upon.”
Our Bridging Finance range covers auction purchases, to private sales and all levels of refurbishment works. Bridging finance is ideal when you need funding fast, with minimal fuss or paperwork.
| Product | Max LTV | Up to 50% LTV | 50.01 – 65.00% LTV | 65.01 – 75.00% LTV | Term & Repayment | Arrangement Fee |
|---|---|---|---|---|---|---|
| Residential Including Light Refurbishment | Up to 75% Lower of PP or MV | 0.43% pm | 0.53% pm | 0.60% pm | Maximum term 24 months No minimum interest or ERCs Interest Fully Rolled Up, Part-Rolled Up or Serviced (subject to affordability) The net advance will be less total potential interest over the term with the gross loan calculated as interest for the entire term and the arrangement fee added. | 1% -1.5% Full fee added to the loan. |
| Semi Commercial Including Light Refurbishment | Up to 75% Lower of PP or MV | 0.6% pm | 0.6% pm | 0.6% pm | ||
| Commercial Including Light Refurbishment | Up to 70% Lower of PP or MV | 0.75% pm | ||||
| Residential Heavy Refurbishment | Up to 75% Lower of PP or MV | 0.60% pm | 0.65% pm | 0.7% pm | ||
| Commercial and Semi Commercial Heavy Refurbishment | Up to 70% Lower of PP or MV | 0.83% pm | 0.83% pm | 0.7% pm | ||
Housing secretary, Robert Jenrick, announced on the 24th February that consumers would be protected by an independent new homes’ ombudsman.
“It is unacceptable that new houses have in many cases been built to a shoddy standard and that some housebuilders have displayed poor service when house buyers find that they have problems with their new home,” he told MPs in the Commons.
“Poor-quality builders will now have to pay compensation for shoddy workmanship, and housebuilders must join the new ombudsman scheme, so all house buyers will see swift action to resolve the issues that they encounter.”
Mr Jenrick said new laws will require all developers to belong to the ombudsman scheme which would have the power to ban rogue developers and order developers to fix poor building work.
New measures are being put into place to ensure all homes sold under the government’s help-to-buy scheme meet high-quality standards.
Less is more
Property agents, Savills, said Mr Jenrick’s reference to building one million new homes over the current government’s term suggested annual delivery targets could drop from 300,000 to 200,000.
Savills residential research analyst, Nicholas Gibson, said: “I think there is a shift in focus to get the quality standards up.”
However, the FMB would like the government to go further with a licensing scheme.
Mr Berry said: “The drive towards ensuring quality for the consumer cannot be fully achieved without an industry-wide adoption of a licensing scheme.
“So long as any company is legally allowed to undertake construction work in the UK without having to demonstrate a minimum level of competence, homeowners will remain at risk from rogue builders and poor service, leading to the sorts of complaints that the new homes ombudsman has been established to address.”
Currently, homebuyers who purchase new builds have no independent way of challenging developers’ service or poor workmanship.
Bridging Loans by HZA
Brokers Hank Zarihs Associates said raising housebuilding standards was something development finance lenders would be pleased to see.
