Mortgages  

Fake EWS1 forms cause headache for borrowers

MHCL also acknowledged that the EWS1 "is not a government form, legal requirement or a building safety certificate". It continued: "We’re disappointed if this is still being asked for in some cases where it’s not necessary."

EWS1 forms were created by UK Finance, the Building Societies Association and RICS back in December 2019 to address the government’s advice note on building safety and cladding which only applied to buildings over 18 metres.

When the government's advice changed in January 2020 to include buildings of any height, a six-storey-plus approach to EWS1 forms was no longer applicable. Despite RICS' updated guidance, the government’s own advice note on building safety still applies to buildings of any height.

Urgency remains around EWS1 forms

Saffron's Hall highlighted some of the hoops mortgage applicants have had to jump through to secure an EWS1 form.

“The freeholder might not have applied for the certificate. Or the cladding might not be certifiable.

“Certifiability is key in the resalable status of a property. If the security isn’t readily saleable, then the property isn’t a good risk for lenders.

“Applicants often can’t get support from freeholders, because they’re too confused or stuck in the backlog [of other forms].”

Hall concluded: “If you haven’t got that certificate now, it’s a case of how soon you can get one.”

He also pointed out that an EWS1 form was only valid for five years. This prompted Hall to question: “What happens in five years' time?”

Each lender’s reliance on EWS1 forms varies depending on their risk appetite. Nationwide employs an in-house team to calculate buildings’ individual risks.

“Some people started asking for EWS1 forms on every building,” Stevens explained. “But we [at Nationwide] do it on a risk-based approach. This means we only ask for an EWS1 form on a small percentage of flats we lend on.”

When an EWS1 form comes back with an A3 or B2 rating - i.e. some combustible materials are present on the outside walls - Nationwide asks more questions.

“We dig into the construction of the building. Is it a standard brick-based building? Is the cladding just small and decorative?”

He continued: “Post-Grenfell, everyone was very nervous, which may have led to overcautious risk assessments. We [Nationwide] don’t want to put unnecessary burdens on flat owners and leaseholders for EWS1 forms.”

ruby.hinchliffe@ft.com