Flood Misery for Home Owners
House purchases are falling through in flood zone areas because buyers are unable to arrange buildings insurance.
Many lenders require evidence that buildings insurance is in place before mortgage funds will be released. Previously many lenders accepted assurances from buyers that insurance will be place.
Buyers trying to arrange insurance before the completion of a purchase are either finding that they are unable to obtain insurance or that insurance is much more expensive than they thought.
The problems are arising due to the fact that Britain continues to be effected by storm damage and flooding, leaving insurers exposed to potentially high payouts.
Many buyers believe that they will be able to get insurance cover and at a reasonable price so leave the process of finding a policy until the last minute. We are now however seeing more house sales fall through due to the fact that buyers are unable to obtain insurance.
There are now thousands of homes in Britain that are at a high risk of flooding. Lenders reserve the right to check that buyers have cover in place. Whether or not the check is carried out can vary according to the Council for Mortgage Lenders (CML).
You can check the risk of flooding using the Environment Agency’s flood maps by visiting their website and then enter your postcode.
If your insurance premium escalates at renewal or if you are rejected for insurance go to the British Insurance Brokers Association for help in order to find a specialist broker. The National Flood Forum is also a helpful website for information.
For further enquiries please contact us on 01484 538421 and ask to speak to a member of the Residential Property team.