Asbestos and Mortgages: What you need to know when buying or selling a property

Asbestos and Mortgages is a subject which is becoming and issue for home buyers and sellers across the UK. It’s becoming increasingly common for mortgage lenders to insist on an asbestos survey being carried out on a property before the lender will consider applying a mortgage to a property. The reason? Well, there are a few.

First of all, asbestos can be expensive to remove, especially if the material is asbestos insulating board (AIB) which is the more hazardous asbestos containing material found in properties. AIB has to removed under what are known as controlled conditions; including installing an airlock to contain all asbestos fibers and using a negative pressure unit (NPU) to ensure that the air is filtered. This type of work can only be carried out by a licensed asbestos contractor.

Because of the possible expense of removing asbesots, lenders are keen to protect their investment. If the person borrowing the money defaults on repayments and the property is repossessed, the lender doesn’t want to be lumbered with a property riddled with asbestos. Basically, they don’t want to be saddled with the extra cost of removing the asbestos in the property if you don’t stick to the terms of your mortgage.

Finally, the Lender doesn’t want a property that they have a financial interest in to be condemned and become worthless. Some older houses in areas such as Jaywick in Essex were constructed mainly of a timber frame and asbestos sheets inbetween (prefabs intended for temporary use after World War II). Remove the asbestos sheets and you are left with a pile of timber, so understandably not many lenders wants to take that risk.

My mortgage lender is insisting on an asbestos report. Can I refuse?

If you want the mortgage, you’ll have to abide by the lender’s terms. If that means that they insist on an asbestos report being carried out, then you’ll need to arrange one. Failing this you can look for a lender which won’t ask for a report, but this can be time consuming and there’s no guaranteed that the new lender won’t ask for one. You also need to ask yourself if you want to get involved in property without first knowing if it contains hazardous materials.

How do I chose an asbestos surveyor?

There are lots of companies offering asbestos surveys, but don’t assume that all asbestos surveyors are the same. If you’re paying for the survey make sure the surveyor has a qualification such as a Part 402 in Surveying and Sampling Strategies for Asbestos in Buildings. It may cost you a little extra than a survey carried out by someone without this qualification, but the survey will be of better quality and carried out in accordance to a set of rules and regulations. Ask to see the surveyors certificate for the Part 402 qualification if you’re in any doubt.

How much should an asbestos survey cost?

A local company should be able to provide you a management survey for around £180+VAT depending on the size of the property. Commercial properties may be more expensive and prices increase depending on the number of rooms, floors or dimensions of the building.

What type of asbestos survey should be carried out?

An Asbestos Management Survey will usually be carried out on a property being purchased. During the survey, the Surveyor will identify any materials which he or she believes contain asbestos and mark them on the report. Samples cannot be taken of any suspected ACM’s with expressed permission on the owner of the property as this may result in damage to walls, floors, etc. A good Surveyor should be able to tell is a material is known as being one which was historically made using asbestos. Some materials, such as textured wall coverings (Artex) may require a sample to be taken.

There is a more intrusive type of asbestos survey known as a Refurbishment and Demolition Survey, sometimes called a R&D Survey. If you’re buying the house with a view to carrying our any demolition or renovations it’s a good idea to have this type of survey carried out. It is more expensive than the standard Management Survey but it will provide more detailed information about where asbestos is present in the building.

What happens if I want to remortgage?

If you’ve already obtained a survey your lender should accept it.

However, a lender may request a survey if there’s never been one carried out on your property before.

Does the presence of asbestos devalue a property?

This depends on the type and amount of asbestos present, but in general, no. It’s generally accepted that properties built prior to 2000 may contain asbestos. Asbestos cement sheets were used on numerous buildings for roofing and cladding and removal of asbestos cement is usually straight forward. Left alone and undisturbed, asbestos containing materials are usually of no risk.

However, if a property contains lots of AIB, or asbestos which must be notified to the Health & Safety Executive prior to removal, or if asbestos is damaged, the costs can escalate. Get a quote for removal if you’re unsure as Asbestos and Mortgages can be a volatile mix.

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