(Bloomberg) — Six of the UK’s biggest lenders will start offering mortgages for high-rise flats affected by the cladding scandal in a move that could help thousands of Britons sell their homes.
Barclays Bank Plc, HSBC Holdings Plc, Lloyds Banking Group Plc, Nationwide Building Society, NatWest Group Plc, and Banco Santander SA will consider new mortgage applications for buildings affected by flammable cladding from Jan. 9, following new guidance from the Royal Institution of Chartered Surveyors on how to value the properties.
Banks will need evidence that dangerous materials will either be removed by developers, or covered by a recognized government remediation program, according to a statement published Tuesday by banking lobby group UK Finance.
After a 2017 fire at the Grenfell Tower in London that killed 72 people, many residents of high-rise properties have struggled to secure mortgages or affordable insurance from wary providers, making their homes all but unsellable.
Apartment prices in Tower Hamlets, home to Canary Wharf and the most tower blocks in the country, remain subdued since thousands of owners discovered their buildings might be structurally unsafe because of the materials used during their construction.
“Today’s announcement is a significant step to enable lending to recommence,” a UK Finance spokesperson said in the statement. “Lenders can more easily keep the market moving by providing a range of mortgage products for customers seeking to purchase or re-mortgage flats impacted by cladding.”
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