Callie Nimki
Legal
Nationwide borrowers can rest easy as lender provides clarity over their leasehold requirements
An update by Nationwide had taken the conveyancing world by storm as they seemed to have hindered the homebuying process and caused more difficulties amongst borrowers and their conveyancers.
An update by Nationwide had taken the conveyancing world by storm as they seemed to have hindered the homebuying process and caused more difficulties amongst borrowers and their conveyancers.
Nationwide Building Society recently updated its requirements in the UK Finance Mortgage Lender Handbook for Conveyancers, causing panic and worry over leasehold conveyancing transactions which involved the lender giant.
The changes related to restrictive covenants and mortgagee protection clauses in leasehold purchases whereby Nationwide had appeared to ask for further information relating to restrictive covenants and for mortgagee protection clauses to be included in every lease. This would have potentially delayed many leasehold purchases due to existing leases having to be amended and registered at HM Land Registry.
However, Nationwide later clarified that their updated restrictive covenant requirements was to clearly establish what information they would need if a conveyancer referred a breach of covenant enquiry to them, thereby saving them time from having to ask the lender for further clarity on the matter.
Nationwide further established that the mortgagee protection clause requirement only related to leases where the terms were unsatisfactory to the conveyancer. As a result, if a conveyancer considered the lease was satisfactory and protective of their client and the lender, the change to the Handbook was not relevant to that transaction and no mortgagee protection clause would be required.
Shah Al Hoque, Trainee Solicitor in our Residential Property team, said:
“One of the biggest fears a buyer has is losing their mortgage offer and this fear can increase with lender’s requirements having to be adhered to, especially in leasehold transactions. However, it is important to have a conveyancer who is able to identify what these requirements are, and ensure they are satisfied so that their clients purchase completes before their mortgage offer expires.
The residential property team at Mullis & Peake are here to assist you in your conveyancing matters and will be able to advise you on the lender’s requirements, whilst they guide you throughout the whole conveyancing process.”