Asbestos And Mortgages Explained

Naturally occurring asbestos was used to build many homes in the UK and around the world until the late 1990s when the fibre’s dangers fully came to light. While it’s now banned in the construction industry, there are still buildings where asbestos is present.

If the property you want to buy contains it, you’ll likely be wondering how to go about mortgaging a house with asbestos, how to overcome the obstacles, whether it’s even possible, and what help is out there. Read on to find out.

Is it possible to get a mortgage on a property with asbestos?

In theory, getting a mortgage on a property that houses the substance is still possible. However, it will be a more tricky process and there will be hoops to jump through.

About half of all lenders will consider offering mortgages on properties with some degree of asbestos, and each has its own set of rules regarding this. The implications are serious, so thorough surveys to assess the risks are often essential before any firm offers are made.

Seeking professional help from a mortgage broker in the first instance is wise. It will save you time in finding accommodating lenders and understanding what steps you need to take.

Why is it more difficult?

The effects on the human lungs from asbestos inhalation can be severe over time, leading to lung disease and cancers. The dangers to human life and health are the drivers behind lenders’ caution over the substance, which also ties into the financial implications.

Asbestos is extremely costly to remove, and lenders will see a risk there when it comes to that all-important resale value. Essentially, if you default on your payments and a lender is left needing to recoup their loan via the sale of your home – and that home contains asbestos – they could be left with an expensive problem or struggle to sell the property at all.

Where is asbestos commonly found?

Asbestos was used in the construction of buildings, mostly between 1930 and 1950, to fireproof, insulate and soundproof them because it’s a cheap and strong material. It was used for flooring and roofing and even sprayed on walls and ceilings. It can also be found near boilers, pipes, garages and fireplaces.

The presence of asbestos alone does not pose a threat; however, it becomes dangerous when damaged or disturbed, such as in old buildings. If you’re looking at buying a house with asbestos roof tiles, which is the most common place for it to be found, the risk could be considered minimal by lenders because it’s unlikely to be disturbed. Builders had mostly stopped using asbestos by the 1970s.

What do you need to do?

Your first port of call is to find a mortgage broker with whom you can discuss your situation and application. They will initially point you in the direction of the most accommodating lenders, who will then most likely request that a surveyor assess the property in question before any further steps are taken.

Some lenders will insist on using their surveyors, while others expect you to source your independent expert, demanding they are UKATA, UKAS, ATAC or RSPH qualified. Their findings will determine the extent of the problem and what happens next in the process – a firm no or something you and the lender can work with.

Will removing asbestos improve your mortgage chances?

If the report results conclude that the asbestos will adversely affect getting a mortgage on a particular property, you could consider removing the material. However, a professional will need to carry out the work, which will likely be expensive, so you should consider whether it is worth the cost.

Work with your mortgage broker to plan a course of action. One option could involve negotiating the house price with the seller to offset the asbestos removal costs.

How a broker can help in this situation

Navigating the asbestos issue in a property you want is complex and unpredictable. A specialist in this area, such as the ones we work with, will make a huge difference to the outcome of your situation.

Experienced mortgage brokers understand which lenders are open to lending to applicants for asbestos properties and their criteria. They will also be able to advise you of the implications of going forward with the purchase and undertaking a mortgage under the circumstances, as well as finding a good surveyor.

Call us today on 0330 818 7026 or make an enquiry online to get matched to a mortgage advisor who specialises in asbestos properties. The more niche and focused a broker you can find, the more insight you’ll receive, so you must find a specialist asbestos advisor rather than a generic one.

Which lenders will consider mortgages of this type?

There are a good number of lenders who are willing to consider mortgaging properties despite having asbestos present—about half of the total number on the market. This is good news if you have your heart set on a home with this issue. However, you should note that lenders will approach each application on its own merit, so the circumstances surrounding the hazard and property type will always determine the outcome.

The most accommodating lenders towards asbestos range from the big high street names, such as Barclays, Nationwide and HSBC, to more niche lenders, such as Mansfield Building Society, Furness Building Society and Precise Mortgages.

Lenders who will not entertain the prospect of an asbestos mortgage have a similar range, with Metro Bank, Norton Home Loans, and Pepper Money as examples.

Approaching a lender directly is not recommended if the property you’re buying has asbestos. Applying through a broker is a better alternative, as they can match you with a mortgage provider who is most likely to approve you for a mortgage based on the extent of the problem.

Are there additional eligibility requirements?

In addition to the fact that your property would be reported on individually, some lenders stand by a number of factors as a general rule, such as the asbestos must not be in a load-bearing wall, the age of the property, and any damage that has occurred.

Other than that, getting a mortgage on a property with asbestos is the same as getting a mortgage on any other property, with all of the usual eligibility and affordability criteria to meet. There is just another feasibility element to the process.

Can you get a buy-to-let mortgage?

Potentially, yes. The rules work the same for a buy-to-let mortgage as they do with a residential mortgage: it will be considered on its own merit, subject to a professional surveyor’s report, and it must not be a load-bearing wall (in some cases), breaking down, or damaged.

What if you’ve already had a mortgage declined because of asbestos?

If you’ve already encountered resistance, try not to lose faith in your goals just yet. This is a complicated corner of the mortgage landscape, and without professional help directing you and drawing upon contacts and experience, it can be very difficult to be successful. With the right support, being declined for a mortgage before doesn’t necessarily mean you will be again.

However, it is recommended that you apply through a broker who specialises in asbestos properties the next time around, as this can boost your chances of a better outcome.

Get matched with a broker who specialises in asbestos properties

When it comes to needing a niche advisor, the ones we work with are just that. We can match you up with someone with the expertise and experience in the exact area you need, which means they will immediately understand what you need.

Asbestos in a property doesn’t have to mean the end of your mortgage dreams. It just needs a little extra care and attention. Call us on 0330 818 7026 or make an enquiry online for an initial, free consultation to find out more.