Back to the blogs list

A positive outlook for cladding burdened buildings.

A positive outlook for cladding burdened buildings.

A positive outlook for cladding burdened buildings.


In the wake of the Grenfell fire the industry shut down offering mortgages on properties with potentially dangerous cladding. Finally, after nearly 5 years the government, banks and developers have a plan of action.  


A little over 4 weeks ago UK Finance which represents the banks issued a statement saying they will “provide leaseholders and potential buyers with more clarity on purchasing homes with building safety issues” 

6 major high street banks have committed to offering mortgages on buildings over 11 meters with the safety issues so long as there is an agreed remediation plan in place funded by either the government or the developer. In some instances, this will still be possible without the remediation plan so long as there is cover by the building safety act.  

This was further set in stone on the 30th of January when Michael Gove announced that building firms had received legally binding contracts worth £2bn that will commit them to pay to repair unsafe buildings, from the Department for Levelling Up, Housing and Communities. The firms have been given 6 weeks to sign the agreements or face “significant consequences”.  

Under the agreement the developers will commit to repairing buildings they have built or refurbished over the last 30 years. The cost which is likely to exceed £2bn is in addition to the building safety levy which combined means the industry will fork out an estimated £5bn to make their buildings safe.

The contract also requires developers to pay back the taxpayer where public money is used to make safe their buildings.  

The move comes following Goves demand in January for the industry to be held accountable. 49 developers have now pledged to fix their buildings.  

So, what does this mean for you?  

Well, if you are one of the thousands of people who are currently being held in a lease hold mortgage prison you may we now be able to look at selling your property. Read on for more detail.  



Santander will consider mortgages in England on properties irrespective of the buildings height or whether remedial work has started provided that the correct evidence has been shared. It said unless specifically requested they will also not request an EWS1.  



HSBC has said they may still require an EWS1 but will also take into consideration a building that has failed its EWS1 rating so long as there are funds in place to fix it.  

An HSBC spokesperson said, “These changes will provide valuers with improved guidance to enable lending on properties with cladding, while providing more clarity and certainty for those living, or wanting to purchase a property, in a block with cladding.” 



Nationwide have said they will consider buildings that have an EWS1 with ratings of A3 and B2 so long as there is “confirmation that there is a clear path to the building being remediated, an outline of the cost of the works and who is paying for them”. 

“Assuming that is all confirmed in writing, we would lend on the property, subject to our normal lending policy and checks. However, while that confirmation is being received, we would also need assurance that there are adequate interim safety measures in place”. 

“Nationwide will lend to leaseholders living in properties impacted by cladding, where those properties are covered by the government or developer remediation schemes – subject to our normal lending policy and checks.”   

~ B2 is the lowest grade available after an EWS1 assessment – which essentially means the external wall contains combustible materials and remedial work is required.  

~ A3 implies the external wall does not contain combustible materials, but work may be required to fix attachments such as combustible balconies and risers.  

Both ratings have led to failed EWS1’s and ultimately a complete rejection from mortgage lenders since 2017 leaving owners often with no choice but to sell at a substantially lower price to cash buyers.  




The Lloyds banking group have Echo'd Nationwide committing to supporting more customers with properties affected by class A3 and B2 EWS1 properties however, leaseholders in eligible buildings will now need to complete and submit a leaseholder Deed of Certificate to the building freeholder.


Barclays have also committed to the same so long as there is a recognised remediation scheme in place based on supporting documents. 


Gove says: “Today marks another significant step towards righting the wrongs of the past and protecting innocent leaseholders, who are trapped in their homes and facing unfair and crippling costs.   

“Too many developers, along with product manufacturers and freeholders, have profited from these unsafe buildings and have a moral duty to do the right thing and pay for their repair.   

“In signing this contract, developers will be taking a big step towards restoring confidence in the sector and providing much-needed certainty to all concerned.   

“There will be nowhere to hide for those who fail to step up to their responsibilities – I will not hesitate to act and they will face significant consequences.”   


Now that we have the banks, the government and the developers in agreement we should start to see a much-needed opening in the market for leasehold premises to start moving again.