Hope for clothing victims as MPs tell mortgage lenders to allow shared-ownership borrowers to sublet



Homeowners in condominiums are considered to be insecure due to clothing or inadequate fire safety standards should be able to sublet their homes after the housing minister wrote to lenders advising them to be more flexible.

Shared owner-occupied homes provided through the Affordable Homes Program are currently facing sublease restrictions, which are limited in all but “usual” circumstances. The restriction is in place to prevent homes built with public funds from being used for commercial gain.

But the government has now changed its appropriations guidelines to make it clear issues of building safety must be treated as an extraordinary circumstance.

This will allow shared owners to sublet their homes with the consent of their owners, but mortgage lenders will also need to give permission, something they have been slow to do.

As a result, Housing Minister Christopher Pincher wrote to mortgage lenders urging them to accept sublease applications from affected joint owners.

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To reduce the costs involved, Mr. Pincher also asked mortgage lenders to consider extending the period during which a shared owner can sublet their home before converting to a mortgage, and he asked lenders to waive any premium associated with this. with the extension of consent-to-rental period.

In identifying the government’s renewed approach to building security, Mr Pincher highlighted four key principles.

He said: “We need to take a proportionate approach in building appraisal in general.

“Too many buildings are considered to require expensive redevelopment or remediation work, and tenants are caught by a too cautious approach that goes beyond what we consider necessary.

“We must protect ordinary tenants and guarantee that no tenant living in their own apartment pays a penny to repair dangerous clothing.”

Sir. Pincher reiterated the government’s recent stance that the industries at fault must pay.

“Those who built and contributed to our stock of precarious buildings, and those who continue to cut corners in building security, must pay to repair deficiencies instead of taxpayers or tenants,” he said.

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“And we must hold accountable those individuals and companies who have deliberately and continue to put lives at stake.”

Pincher told lenders that immediate action should be taken to support the affected shared owners, who are currently facing restrictions.

“I understand that you will need to assess your organizational risk profile when considering subletting requests from shared owners,” he said.

“I also understand that you will need to consider how waiving the 1 percent annual premium during a consent-to-rental period is consistent with your liability under competition law.

“However, I hope that you appreciate the position that the affected joint owners have found themselves in terms of building security without their own fault and that you will do everything to approve their sublease requests.”

The letter follows Michael Gove, The Secretary of State for Leveling Up, Housing and Communities, announced on January 10 that the government had reset its approach to building security.

Under the new plans, wealthy developers and companies would be forced to pay to rectify the clothing crisis, with harsh fines issued to those who fail to act.

Mr. Gove assured that no tenant living in their own apartment would have to pay a penny to repair unsafe clothing, whereas according to previous plans, the bills would have been imposed on tenants.

The industry has been given two months to accept a financial contribution scheme to finance the new plan, otherwise the government will, if necessary, impose a solution in law.

In addition, a new team is being set up to prosecute and expose companies with errors and to force them to bear the burden of making buildings safe.

Mr. Gove said: “More than four years after Grenfell Tower tragedy, the system is broken.

“Tenants are trapped, unable to sell their homes and face big bills.

“But the developers and clothing companies that caused the problem are evading responsibility and have made huge profits during the pandemic while hard-working families have struggled.”

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He confirmed that previous proposals for loans and long-term debt to tenants in medium-sized buildings would be scrapped, while the government would aim to introduce new tenant protections into law through the Building Security Act.

Sir. Gove concluded: “And we want to restore the much-needed common sense in terms of building safety assessments and stop the practice of declaring too many buildings unsafe.”

Lady Judith Hackitt, who chaired the independent review of building regulations and fire safety, welcomed the plans, noting that they will provide “great relief” to tenants who have felt “trapped” in their current predicament.

Dame Hackitt said: “Those who caused the problem now have to step up, take responsibility and show some leadership.

“This problem has been going on for too long and we need a quick fix, not months of debate and negotiations that leave innocent tenants in further limbo.”

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