Topic 15: Other factors that affect the lending decision Flashcards
What are Permitted development rights?
The right for a landowner to carry out certain building work, extensions, etc, within specified limits, without the need to seek planning permission.
What is Planning Consent?
Required from the local authority in the case of proposed building works, extensions or development outside permitted development rights.
What are building regulations?
Regulations relating to the structure of building work and the materials used in such work, designed to ensure the health and safety of people in the building and efficient energy conservation. A project that does not require planning consent must still meet building regulations if they apply.
What is a Listed building?
Designated as being of significant architectural or historical significance and value. It does not have to be really old: there are listed buildings built less than 60 years ago. Permission is required to make changes to, or demolish, listed buildings.
What is a Conservation area?
Designated as being of architectural or historical significance. Owners of properties in such areas may need permission to alter or demolish a property, even though the property itself may not be listed.
What is Loan to value?
The mortgage as a percentage of the property value.
What is Higher lending charge?
A single payment charge some lenders make if the loan to value is higher than they would normally allow. It typically applies to the loan amount above 75% or 80% loan to value.
What is Mortgage Indemnity Guarantee (MIG) Policy?
Used by some lenders, an insurance policy paid for by the borrower but protecting the lender on high loan-to-value loans if the borrower defaults. Covers the part of the loan above the lender’s normal loan-to-value threshold if the sale proceeds of a repossessed property are lower than the outstanding mortgage. The policy will pay the lender the shortfall between the price received on sale and the lender’s normal threshold, less the excess.
What is a Mortgage Exit fee?
Charged by the lender to cover its costs when a borrower repays the mortgage and closes the account. There are MCOB rules on what constitutes acceptable components of a mortgage exit fee.
An owner can build an extension, conservatory or addition to a home without
planning consent if it meets one of a number of conditions, including the
following:
- The addition and previous additions, including outbuildings, do not cover more than half the area of land around the original house.
- The extension is within certain height and depth limits:
— the front or side of the property will not be closer to a highway than before;
— no part will be higher than the highest part of the existing roof;
— two‑storey extensions are no closer than 7m to a rear boundary;— the depth of a two‑storey extension is no more than 3m from the rear
wall of the original house. - Building materials match the existing building.
- Converting a garage internally does not add to the size of the building.
- A loft extension does not exceed 50m3 (detached house) or 40m3 (any other
home). - Erecting aerials or satellite dishes is permitted.
- A single‑storey extension can project from the rear wall of the original
house wall by up to 8m on a detached property and 6m on other property.
Such work is subject to the neighbour consultation scheme, which requires
owners to notify the local authority which, in turn, consults the adjoining
neighbours. The local authority considers any issues raised before allowing the development to go ahead.
What is the neighbour consultation scheme?
The neighbour consultation scheme fast‑tracks the process for non‑controversial projects while protecting the reasonable interests of neighbours.
WHAT SORT OF WORK STILL REQUIRES PLANNING CONSENT?
- Work on an
existing property
outside the scope
of permitted
development - Work on a
listed property or
a property within
a conservation area - Building a new property
- Converting an existing building, eg a barn
- Dividing a single property into separate homes
- Work that would contravene original planning consents
Provide 6 examples of Building work covered by the regulations?
- The erection of a new building
- The extension of an existing building
- Cavity wall insulation
- Adding or removing internal walls
- Loft conversion
- The underpinning of a building’s foundations
Provide 3 examples of Building work exempt from the regulations?
- A carport extension, open on at least two sides and under 30 square metres in floor area
- A detached garage under 30 square metres in floor area and built at
least one metre from the boundary of the property - A new garden or boundary wall
What environmental factors may cause concern?
- Radon Gas
- Contaminated land
- Overhead electrical power lines
