Principality Building Society

Transcription

1 Principality Building Society < Back to handbook selection Part 1: England and Wales Last modified: 01/07/2017 Part 2: Principality Building Society Last modified: 07/11/2018 Print PDF Part 2 only 1.7 Contact point to see if the lender will lend when borrower and mortgagor are not one and the same. - We will only lend in such circumstances where we give you specific instruction to do so. 1.11aContact point for standard documents. 1.11bContact point if standard documents are inappropriate.

2 1.14 May your firm act if the person dealing with the transaction or a member of his immediate family is the seller? Yes, provided that: * there is no conflict of interest and none arises during the transaction * the firm is a partnership * the conveyancer acting is not the seller or a member of the seller's immediate family. Written confirmation must be sent and acknowledged (as detailed in 1.11) Law Society Guidelines and the SRAÂ s Outcomes - Focused Regulation is to be followed May your firm act if the person dealing with the transaction or a member of his immediate family is the borrower? Yes, provided that: * there is no conflict of interest and none arises during the transaction * the firm is a partnership * the conveyancer acting is not the borrower or a member of the borrower's immediate family. Your written confirmation must be submitted to us and you must await our written acknowledgement before proceeding Does the lender require notification of the name and address of the solicitors firm or licensed conveyancers firm acting for the seller? We do not require notification unless the name and address of the solicitors firm or licensed conveyancers practice do not appear in a legal directory or they are not currently on record with the Solicitors Regulation Authority or Council for Licensed Conveyancers as practising at the address shown on their note paper If different from 1.11, contact details if the lender needs to be notified when the seller does not have legal representation. You will need to notify us using the details in 1.7 in the event of the seller not having legal representation or representation of an independent nature e.g. where you are dealing with in-house legal advisors What other documents are acceptable for verifying identity? List A: Current signed UK passport Current signed full UK Driving License* HM Revenue and Customs Tax Notification (dated in the last 12 months)* EU member state ID card*/ EU passport Non EU passport and valid Visa State pension or benefits document or notification from the Department of Work and Pensions (DWP) confirming the right to benefits (under 12 months old)* * those items marked with an asterisk can be used for either name or address verification but not for both.

3 List B: Gas and electric bill (under 3 months old) Water bill (under 12 months old) Local Authority tax bill (under 12 months old) Letter from a Government Department about your personal affairs (under 12 months old) Solicitor s letter confirming completion of house purchase or land registration together with proof of previous address (under 6 months old) Mortgage Statement (under 12 months old) Local Authority or Housing Association tenancy agreement (under 12 months old) Official letters from a care or nursing home confirming residence (under 12 months old) Bank, Building Society (savings) or credit card statement (under 3 months old and not online print out) Does the lender require notification of the name and address of the solicitors firm or licensed conveyancers firm acting for the seller? We do not require notification unless the name and address of the solicitors firm or licensed conveyancers practice do not appear in a legal directory or they are not currently on record with the Solicitors Regulation Authority, Council for Licensed Conveyancers or other legal regulatory body as practising at the address they have provided to you If different from 1.11, contact details if the lender needs to be notified when the seller does not have legal representation. You will need to notify us using the details in 1.7 in the event of the seller not having legal representation or representation of an independent nature e.g. where you are dealing with in-house legal advisors. 4.1 Is there a valuation report and if so, does the lender provide it? We may not always arrange for a physical inspection of the property. We do not provide a valuation report for remortgages however do provide one for purchases. If a valuation is provided you should compare this against the mortgage offer and if you have any issues that may require clarification/investigation please contact us using the details in 1.7. The mortgage valuation is for our use only. Borrowers ought not to rely upon it when deciding whether to proceed to buy a property. 4.3 If different from 1.11, contact point if assumptions stated by the valuer are incorrect.

4 4.5aIf different from 1.11, contact point if re-inspection required. 4.5bWhere should the certificate of title be sent? Completions Team NOTE: Only signed and fully completed certificates will accepted. Completed certificates may also be scanned and ed to: If different from 1.11, the contact point if the seller has owned the property for less than 6 months: Please provide us with the following information: i) the name and address of the person who sold or will be selling the property to the applicantâ s seller; ii)the amount paid for the property by the applicantâ s seller; iii) details of any connection between the original seller and the applicantâ s seller, or between either seller and the mortgage applicant; iv) details of any work carried out to the property between the 2 transactions; v) when the 2 transactions took place or will take place and vi) an explanation as to why the seller is selling within the 6 month period specified in section 5 of the handbook. You must not proceed with your instruction until you receive written confirmation from us that you may do so If different from 1.11, the contact point if the seller is not the owner or registered proprietor and is not listed in the exceptions above: Does the lender want to receive environmental or contaminated land reports? Yes, if adverse contaminated land entry revealed in Local Authority Search or if recommended by the valuer

5 5.4.5 Does the lender accept personal searches and, if yes, what are the lender's requirements? Yes provided: i) that the requirements of and are satisfied, ii) an unqualified certificate of title is given to us and, iii) the conveyancer does so at his own risk. Also the search firm used must be registered under The Search Code monitored by the Property Codes Compliance Board (PCCB) Does the lender accept search insurance and, if yes, what are the lender's specific requirements? Purchase; No Re-Mortgage; Yes, if the search insurance adequately protects us and you are satisfied that you will be able to certify that the title is good and marketable. Section 9 of the handbook must also be satisfied aIf different from 1.11, contact point for reporting if evidence of breach and all outstanding conditions will not be satisfied by completion: 5.5.3bDoes the lender require an original/copy of the planning permission? No, please pass to the borrowers for safe keeping 5.5.3cDoes the lender require an original/copy of the building regulation consents? No, please pass to the borrowers for safe keeping 5.5.3dDoes the lender require certificates of lawful use or development/established use certificate? No, please pass to the borrowers for safe keeping If different from 1.11, contact point if the property is subject to restrictions which may affect its value or marketability.

6 Please advise us of the nature of the restrictions and their potential impact on us. Await receipt of the Society'Â s response before proceeding aDoes the lender lend on flying freeholds? Yes, provided the flying freehold is no more than 25% of the total floor area of the property 5.7.1bDoes the lender lend on freehold flats? No If you need to discuss this further please contact us and await our reply: cIf the lender is prepared to accept a title falling within 5.7 and the property is a freehold flat or flying freehold, to which contact point must this be reported? Does the lender accept security which comprises a building converted into not more than four flats where the borrower occupies one of those flats and the borrower or another flat owner also owns the freehold of the building and the other flats are subject to long leases? Yes - Subject to the conveyancer confirming that each lease contains adequate covenants regarding maintenance of the building the flat is part of. You should also bring to our attention any interest the borrower has in any other flats in the building Does the lender accept security which comprises one of two leasehold flats in a building where the borrower also owns the freehold reversion of the other flat and the other leaseholder owns the freehold reversion in the borrower's flat? If so, are there any specific requirements? Bullet 1: Yes provided that the Lease provides for the compulsory transfer of the freehold share simultaneously with the sale of the lease or the unexpired term of the Lease is at least 85 years plus the term of the mortgage. If the unexpired Lease term is less than 85 years plus the term of the mortgage, the Society will require the

7 lessee to either extend the Lease term in order to satisfy its unexpired term requirement as above or alternatively the lessee may vary the Lease so it provides for the compulsory transfer of the freehold share simultaneously with the sale of the lease. In addition if there are more than 2 flats in the block we will require a management company to be in place. See 5.14 for our requirements for leasehold securities generally. Bullet 2; Yes; See 5.14 for our requirements for leasehold securities generally. We require the borrower's leasehold interest in the flat they occupy to be charged and we also require a charge over the borrower's freehold interest in the other flat subject to the lease in favour of its occupier Does the lender lend on commonhold? No If different from 1.11, contact point if there is a restriction on use. Refer to us and await our decision before proceeding If different from 1.11, contact point if borrower is not providing balance of purchase price from funds/proposing to give second charge. We do not require you to report a gifted deposit subject to you being satisfied that the following conditions are met: The gift is from a family member(s), who confirms it is not repayable. You must report a gifted deposit from a family member who is also the Vendor. Gifts from unrelated third parties, including friends and employers are not acceptable. A family member is defined as; spouse, mother, father, brother, sister, child, grandparent, grandchild or legal guardian Where a gifted deposit is acceptable you must obtain, and retain, on your file a letter, addressed to you, from the giftor(s) which confirms the following information; The name and address of the family member gifting the deposit Their relationship to the borrowers(s) The name and current address of the borrower(s) The address of the property being purchased The amount being gifted and the source of the funds That the gift is not repayable and the family member(s) providing the gift will not acquire an interest in the property. You must ensure clear bankruptcy searches are carried out against the borrower and all parties contributing to the balance of the purchase price. You must notify us if you cannot obtain clear searches.

8 You should continue to report any other circumstance where the balance of the purchase price is not being provided in accordance with part 1 and in doing so must wait for our written instructions prior to proceeding. Please write to:- As at 1.7: What minimum unexpired lease term does the lender accept? You should notify the Society where the unexpired term of the lease is 85 years or less. The Society's lending policy is that it requires a minimum unexpired lease term of 85 years If different from 1.11, contact point for matters connected with the lease: Ground rent and other fees referred to within the Lease must be reasonable at all times during the Lease term. Ground rent increases linked to RPI or a similar index are generally acceptable but unreasonable multipliers of ground rent are not acceptable. If you are in doubt you should refer to us and we shall refer this to our valuer. Any ground rent which is currently at a level or, may reach a level referred to within the Housing Act 1988 (hence allowing a long lease to be treated as an AST) is NOT acceptable unless the Lease is varied or a suitable indemnity policy is put in place to protect us. The applicable legislation relates to leases with an annual ground rent of more than 250 (or over 1,000 for properties in London). The risk is that a Court has no option other than to grant an order for possession in arrears situations and also the power of a Court to grant relief from forfeiture of the lease does not apply to ASTs if at least 3 month's rent is more than 3 months overdue. The Court has no choice in such cases - it must terminate the lease and give possession back to the freeholder. Usual provisions for relief from forfeiture are not applicable If different from 1.11, contact for service charge matters:

9 Does the lender accept indemnity insurance where the terms of the lease are unsatisfactory? Yes - provided you are satisfied that such insurance is a solution to the problem identified and you can give an unqualified Certificate of Title. The conditions in paragraph 9 must also be satisfied. Please add details of the Policy provider and the Policy number on the Certificate of Title and retain a copy on your file Does the lender require a clear ground rent/service charge receipt to be sent to you? No, please pass to the borrowers for safe keeping Does the lender require a receipted copy of notice or evidence of service to be sent to you? No, please pass to the borrowers for safe keeping aIf different from 1.11, contact point if there is an absentee/insolvent landlord: bDoes the lender accept indemnity insurance if the landlord is absent or insolvent? Yes - provided you are satisfied that such insurance is a solution to the problem identified and you can give an unqualified Certificate of Title. The conditions in section 9 must also be satisfied. You must provide us with a copy of the Policy and retain a copy of the Policy on your file aIf different from 1.11, contact point if there are apparent problems with the management company: bDoes the lender need to be sent the management company share certificate? No, please pass to the borrowers for safe keeping cDoes the lender need to be sent the signed blank stock transfer form? No, please pass to the borrowers for safe keeping

10 5.15.2dDoes the lender need to be sent the management company's memorandum and articles of association? No, please pass to the borrowers for safe keeping If different from 1.11, contact point if unable to certify search entry does not relate: aDoes the lender need to be sent the power of attorney? Please send a certified copy with Certificate of Title bDoes the lender need to be sent the statutory declaration of non-revocation of power of attorney? Yes - a copy must be sent with the TID after registration of the Society s Charge at the Land Registry If different from 1.11, contact point for lending on affordable housing, shared equity and shared ownership and where relevant your requirements: Where a scheme has been previously agreed we will lend on certain Shared Equity and Shared Ownership properties; you are required to seek our confirmation prior to exchange. Please note that The Society is not obliged to provide further borrowing on any such mortgages. Please refer to (details in point 1.7) for any further clarification Does the lender require me to report to them where the lease does not meet the UK Finance minimum requirements for leases of roof space for solar PV panels? Yes Does the lender have additional requirements relating to leases of roof space for solar PV panels, and if so, what are they? See UK Finance's minimum requirements on the UK Finance website. If the lease does not meet the minimum requirements referred to above we will not lend but please advise us if this is the case so we may close our file. You must not submit your Certificate of Title to us unless you are satisfied that UK Finance's minimum requirements have been satisfied. Post completion requests are subject to different criteria and should be referred to the Mortgage Admin Team

11 at the address detailed in 1.11a Does the lender require you to disclose the details of any existing Green Deal Plan(s) on a property? Yes, you must disclose details of any existing Green Deal Plans to us as detailed in If different from 1.11, contact point if borrower is not taking up the mortgage offer: If different from 1.11, contact if any discrepancies in property's description: If different from 1.11, contact point for any issues relating to purchase price: Does the lender require me to report incentives? Yes, the Society will require the "CML Disclosure of Incentives Form" to have been checked by you. You must advise us as soon as you become aware and in any event prior to exchange of contracts, where the source of the deposit is NOT from the Borrower's own funds and await our approval before proceeding. You should contact us should you have any suspicion that we have not been made aware of ANY incentive. Please specify the nature and amount of the incentive. You must also refer to the Law society Mortgage Fraud Practice Note regarding allowances, incentives and discounts when considering this issue. If the purchase price does not reflect the cashback, incentives, or discounts then we may have to reconsider the basis of our lending If different from 1.11, contact point if we will not have control over the payment of all the purchase money: As in 1.7. You are reminded to refer to the Law Society s Mortgage Fraud Practice Note regarding direct payments. Unless the mortgage offer states otherwise, the whole of the mortgage advance must be paid

12 directly to the sellerâ s conveyancer If different from 1.11, contact point if vacant possession is not being given: If different from 1.11, contact point if property is let/to be let and to check you lend on buy-to-let: If different from 1.11, contact point when you do not have details of current letting or letting to take place at completion: Does the lender require counterpart/certified copy tenancy agreement to be sent to you? No, please pass to the borrowers for safe keeping Does the lender lend where the property comes within the definition of a house in multiple occupation? If yes, what are your requirements? No What new home warranty schemes are acceptable to the lender? The following schemes are acceptable BUT YOU WILL BE REQUIRED TO CHECK THAT THE LEVEL OF COVER AVAILABLE UNDER THE WARRANTY WILL BE SUFFICIENT TO MEET THE REBUILDING COST OF THE PROPERTY. A calculation will be necessary when the proposed security forms part of a continuous structure: 1. NHBC

13 2. Zurich Municipal (for cover issued up to the 30/09/09) 3. HAPM 4. Premier Guarantee 5. Building Life Plans 6. LABC New Home Warranty 7. Castle Build-Zone (Where out buildings such as a detached garage are also being constructed an endorsement to include these in cover is required). 9. International Construction Warranty (ICW) - Residential New Build - UK Policy version Advantage HCI New Build Scheme - 10 year structural defects insurance policy for residential property. 11. Protek New Home Warranty Policy 12. AEDIS Warranties Ltd - Homeproof New Build 10 Residential Warranty and Homeproof New Build 10 Residential Warranty for Self Build 13. The Q Policy - Structural Defects Insurance Residential Policy 14. ICW (Sompo Canopius) Residential Warranty UK Version CRL 10 Year Structural Defects Insurance 16. ABC+ Residential New Build Latent Defects 17. ICW (Canopius) Residential Warranty UK Version Global Warranties Ltd - 10 year Structural Defects Insurance Policy What new home warranty documentation should be sent to the lender? Retain a copy for your file and please pass a copy certificate to the borrowers for safe keeping Should any assignments of building standards indemnity schemes be sent to us? No, please pass to the borrowers for safe keeping and retain a copy for your file Will the lender proceed if the property does not have the benefit of a new home warranty scheme? Yes - providing certain criteria is satisfied please review the requirements below. You must check and confirm the following points to us in writing and await our written confirmation that you may proceed with the case: 1. That the professional consultant has the appropriate experience referred to in above (Part 1) and, 2. That the professional consultant has one or more of the qualifications referred to in above (Part 1) and, 3. That the level of indemnity insurance in place is appropriate as detailed in You must NOT submit your COT until we have been provided with all the information requested in points 1-3 above and confirmed to you in writing that the case may proceed despite the absence of a new home warranty Does the lender need to be sent the professional consultant's certificate? No, please pass to the borrowers for safe keeping and retain a copy for your file If different from 1.11, contact point if no agreement and bond for an unadopted road or sewer:

14 6.9.1 If different from 1.11, contact point if necessary easements are absent: If the defect in title cannot be rectified by appropriate documentation we will require a suitable indemnity insurance policy to be in place at completion. The conditions in paragraph 9 must also be satisfied. You must record the policy details on the Certificate of Title and retain a copy of the Policy on your file Who will the lender release any retentions (or instalments of the advance) to? You If different from 1.11, contact point if property is affected by redevelopment or road proposals: If different from 1.11, contact point if pre-emption rights, resale restrictions, options etc will affect the lender's security: If different from 1.11, contact point if property is affected by improvement/repair grant which will not be discharged:

15 7.3 Does the lender require a consent to mortgage from all occupants aged 17 or over? Yes  Mortgage Deed incorporates the Consent Form. You must advise us of any situation where you believe that the pro-forma will not adequately protect our interest in the property. 7.4 If different from 1.11, contact point if doubts about accuracy of information disclosed: 8.1 Does the lender allow me to advise any of the specified third parties? No 9.1 Does the lender need to be sent the indemnity insurance policy? Yes or at the very least the Insurance Company name and Policy number is to be noted on the Certificate of Title. 9.2 What limit of indemnity insurance does the lender require? Full market value of the property is preferred but if this is not available we will accept the loan advance amount as minimum. You must approve the policy on our behalf. The estimated property value is stated in the Mortgage Offer in remortgage cases. Otherwise it will be stipulated in the Valuation. 10.2aWill the mortgage advance be paid electronically or by cheque? Electronically by CHAPS 10.2bWhat is the minimum number of days notice lenders require? 5 working days - The advance monies will be sent to your client account (you must provide details in the Certificate of Title) on the last working day prior to the completion date. Occasional delays in transmitting advance monies can occur as a result of a breakdown in the external CHAPS system. No responsibility can be accepted for losses arising from such delays What are the standard deductions made from the mortgage advance? Please refer to the Mortgage Offer.

16 10.7 On a delayed completion, when and how is advance to be returned? You may hold the advance monies for up to 48 Hours. After this time the advance monies must be returned to us electronically by CHAPS. If completion is delayed beyond the Offer expiry date, we will allow the mortgage to proceed on the original offer terms provided completion takes place within 30 days of the original offer expiry date. We must be notified by you if the matter is expected to proceed If different from 1.11, contact point if completion is delayed? Completions Team How long can you hold the mortgage advance before returning it? 2 days What, if any interest does the lender charge if return of the advance is delayed? Borrowers are charged interest from the same day the advance is released. Interest is charged at the rate applicable to the account If different from 1.11, contact point for release of retentions/mortgage advance instalments: Completions Team Does the lender require me to make a form CH2 application? Yes - if it is an instalment mortgage or where a retention is being made Does the lender need to be sent the original mortgage deed and/or any other original title documents? Yes - please send it to us along with the Title Information Document (TID).

17 Where should the title deeds and documents be sent? Which documents must I send after completion? We require the TID, original Mortgage Deed, Occupiers Consent Forms (if applicable) and insurance indemnity policies that have been requested elsewhere in Part 2 of this Handbook. Other documents should be sent to the borrowers If different from 1.11, contact point for title documents: Does the lender have a standard form of transfer/deed of covenant? No If different from 1.11, contact point for finding out the debt amount: Does the lender need to be sent the transfer of equity? No  - file with HM Land Registry aIf different from 1.11, contact point for obtaining execution of transfer equity:

18 16.3.7bWhat form of attestation clause does the lender use? THE COMMON SEAL OF PRINCIPALITY BUILDING SOCIETY was hereunto affixed BY ORDER OF THE BOARD OF DIRECTORS in the presence of Authorised Official If different from 1.11, contact point for application for consent to letting: Does the lender need to be sent a copy of the proposed tenancy? Yes If different from 1.11, contact point for confirming proposed deed or agreement will not adversely affect the lender: aWhere should the deed of variation be sent? It may be necessary for us to refer any proposals contained in the proposed deed/agreement to our valuer bWhere should the deed of rectification be sent?

19 16.5.3cWhere should the deed of easement be sent? dWhere should the option agreements be sent? If different from 1.11, contact point for redemption statements: aWhere do you send the discharge and repayment remittance? bDoes the lender send the discharge via a DS 1 form or direct with the Land Registry? We discharge directly with the Land Registry using e-ds1 therefore a DS1 form is not required. Repayment remittence is required in writing and should be sent to the address above.