Key facts:
- Client came to us to do a residential remortgage on their flat.
- As part of the remortgage document requirements, the new mortgage lender asked for an EWS1 form to be provided to prove fire safety.
- The management company for the building hadn’t arrange an EWS1 form yet and weren’t necessarily planning on doing it either.
- Without an EWS1 form, the mortgage lender would not lend, making the client’s remortgage egg-timer start to run out.
Our client:
Our client was first introduced to Oportfolio to help with purchasing her first home in 2020. Back in 2020 we secured a 2-year fixed residential mortgage for her and her partner with the view of remortgaging 2-years down the line to secure a new lender and competitive product. After living comfortably and happily in her property for 2-years, we contacted our client 6 months before her product was due to expire so that we could start looking at new mortgage options. Our advisor had a few appointments with the client to get an understanding of their new requirements and what they were looking for in a new mortgage.
As we had already secured the original mortgage for her, it was very easy for us to get a good overview of her current mortgage situation and we advised her of the best route forward with a new lender and product. Because the property was a flat in an apartment block, a lot of mortgage lenders will require something called an EWS1 form (External wall system) which essentially proves the fire safety of the building. This form was introduced in December 2019 by the Royal Institute of Chartered Surveyors after the Grenfell fire.
Normally getting an EWS1 form doesn’t cause too much of an issue when getting a mortgage however, the management company who looked after the maintenance of the building hadn’t organised an EWS1 form and hadn’t planned on getting one either for a number of reasons. Firstly, the building wasn’t tall enough for an EWS1 form to be a legal requirement and secondly, the claimed that because there were only a few organisations in the area that provide the form, the wait time to get one would be too long and it would be very expensive.
Despite this, the lender that we advised and recommended for the client still insisted on the form being provided. Without the EWS1 form, the lender would not be willing to proceed with the remortgage application.
How did we help?
Because of this hiccup with the EWS1 form, the next step was to consider other lenders. As part of the PRIMIS mortgage network, Oportfolio has access to over 90 different mortgage lenders so we had quite a few options. But, there was still the risk that we could end up doing a new credit search on the client and a full mortgage application again and still get the same kickback about the EWS1 form from another lender which would not be ideal. Our advisor Jade and her administration team set about doing some in-depth research into the mortgage lenders on our books to try and determine which ones required an EWS1 form prior to offer and which ones didn’t. However, they found that this wasn’t as simple as they thought it would be as a lot of the mortgage lenders would not allow us to enquire about this directly through them saying that it would be down to the valuer.
The client was getting quite nervous and stressed at the situation because her time to remortgage before her product ended and before she went onto the lender’s high standard variable rate was running out. However, using our knowledge of the mortgage lenders we have access to and our team’s tireless research, we managed to negotiate a new competitive rate with our client’s existing lender as a product transfer rather than a remortgage. Because she already had a mortgage with the lender, there was no property or income assessment needed and no new forms required like the EWS1 form. We managed to get her new offer and agreement arranged within a week. The rate we were able to get with the lender was cheaper and more competitive than the option that the client was able to get directly. The client was understandably very relieved and over the moon that we had managed to find her such a good new mortgage product.
What was the rate?
The loan was secured as a capital repayment and interest mortgage on a fixed rate for 2-years at 2.64%. After the fixed period, they would revert to the bank’s 4.25% standard variable rate at which time we will contact the clients to discuss remortgaging on to another new competitive fixed rate.
The overall cost for comparison is 4.00% APRC. The arrangement fee was £999 which was added to the balance of the loan, and early repayment charges were applied. The mortgage term was 23 years.
If you or someone you know is having issues with either remortgaging or an EWS1 form, feel free to give our friendly and knowledgeable advisors a call today to see how we can help you.
