Asbestos and Mortgages

What Is Asbestos?

Asbestos is the collective name for 6 naturally occurring fibrous materials. The most commonly known - and most dangerous - are white asbestos (chrysotile), brown asbestos (amosite) and blue asbestos (crocidolite). Asbestos became a popular building material in the 19th century, as its fibrous properties were resistant to heat, fire, electrical and chemical damage and were good for sound absorption.

Where Can Asbestos Be Found in the Home?

It's common to find asbestos in residential properties where it's been mixed with other materials for strength, such as corrugated roofing, cement sheeting or decorative wall coatings like Artex. It's also commonly found around boilers, behind fuse boxes, airing cupboards, ceiling and floor tiles, loose-fill insulation, pipe lagging, water cisterns and gas pipes.

Which Properties Are Most Likely to Contain Asbestos?

While brown and blue asbestos were already banned in the UK by 1985, white asbestos, commonly used in the UK's homebuilding industry, was only outlawed in 1999. Houses that have been built since that time don't contain any asbestos. However, if you buy a pre-1999 property, you need to be wary. For instance, Arctex was still being manufactured with white asbestos until the mid-1980s, while the asbestos ceiling and floor tiles were very popular during the 1950s and 60s.

Can I Get a Mortgage on a House with Asbestos?

Getting a mortgage on a house with asbestos present can be challenging, but it is not impossible.

With the number of homes in the UK that have some trace of asbestos, it makes sense that it would need to be possible to find a mortgage. In most cases, a mortgage offer will depend on where the asbestos is in the property and the probability of it being disturbed. Each lender has their own set criteria for approving mortgages on properties with asbestos. For some lenders, their decision will be based on what the qualified surveyor reports in terms of risks.

Here are some key points to think about when considering getting a mortgage on a house with asbestos:

1. Lender requirements: mortgage lenders may have specific requirements or restrictions regarding properties with asbestos. Some lenders may refuse to provide financing for properties with known asbestos-containing materials (ACMs), while others may require proof of asbestos remediation or mitigation before approving a mortgage
2. Property condition: the condition and location of the asbestos-containing materials within the property can influence the lender's decision. If the asbestos is intact and not posing a health risk, lenders may be more willing to consider financing. However, if the asbestos is damaged, deteriorating, or likely to be disturbed during renovation or demolition, lenders may have reservations
3. Asbestos assessment: lenders may require an asbestos assessment or inspection to determine the extent of asbestos presence and any associated risks. A qualified asbestos inspector can assess the condition of the materials, recommend appropriate measures for management or removal, and provide documentation to satisfy lender requirements
4. Remediation or removal: depending on the lender's requirements and the extent of asbestos present, remediation or removal may be necessary before securing a mortgage. Remediation involves managing and containing asbestos-containing materials to prevent exposure, while removal entails safely removing and disposing of the materials. Costs for remediation or removal can vary depending on factors such as the size of the property, the extent of asbestos present, and the chosen method of abatement
5. Disclosure requirements: sellers are typically required to disclose the presence of asbestos to potential buyers. Failing to disclose asbestos may lead to legal liabilities and affect the sale process. Buyers should conduct thorough inspections and assessments to identify any asbestos-related issues before proceeding with a purchase
6. Insurance considerations: homeowners insurance policies may have exclusions or limitations related to asbestos-related claims. Buyers should review their insurance coverage carefully and consider obtaining specialised coverage or endorsements for asbestos-related risks

Overall, while it may be more challenging to secure a mortgage on a property with asbestos present, it's not impossible with proper assessment, remediation and documentation.

Why Does Asbestos Make It Harder to Get a Mortgage?

Removing asbestos can be expensive and time-consuming, so lenders will factor this additional cost into the property valuation. Also, if they have to repossess the property in the future, having asbestos in the property will make it more difficult to sell. These issues, along with the serious health risks and the impact of asbestos on property prices, can make many mortgage lenders cautious when it comes to offering mortgages on these properties.

Many lenders do recognise that the risks largely depend on where the asbestos is in the property and the likelihood of it being disturbed. Each lender will have specific criteria for whether a property with asbestos is mortgageable.

Some lenders and mortgage brokers will find it challenging to provide a mortgage where asbestos is concerned; you may also need to consider whether your home is subject to non-standard construction, so it's important to discuss Non-Standard Construction mortgages with a specialist mortgage broker like John Charcol.

Which Lenders Will Approve Mortgages for Properties with Asbestos?

Several mortgage lenders will let you borrow on a property with asbestos. High-street lenders such as Natwest, Santander and Nationwide are generally willing to offer mortgages on these types of properties. TSB will consider lending on homes with asbestos if it's not present in load-bearing structures. Meanwhile, Barclays will turn down applications on properties where the asbestos is found to pose serious health risks or significantly impacts the property's value.

However, some high-street banks will automatically decline applications for mortgages on properties with asbestos - such as Virgin Money, Metro Bank and Coventry Building Society.

It's important to remember that being rejected for a mortgage will mark your credit report. Therefore, you should avoid applying for a mortgage from lenders who don't accept properties with asbestos if you’re not having the asbestos removed. An independent mortgage broker like John Charcol will be able to advise you on the best mortgages for properties with asbestos.

How Can I Confirm Whether a Property Has Asbestos?

An asbestos survey will determine whether a property has asbestos, the degree of risk and whether it is likely to be disturbed. A qualified surveyor from RSPH, ATAC, UKAS or UKATA will carry out a check on the property.

If the asbestos mortgage survey determines that there's a likelihood that the asbestos will become airborne and pose a health risk to those living on the property, some lenders automatically decline your application. Others will consider the surveyor's findings but will only lend to you if the property has load-bearing asbestos panels, or the asbestos is undisturbed.

Can I Get a Mortgage if I Remove the Asbestos?

If the surveyor identifies asbestos in the property and doesn’t see it as an issue and doesn’t recommend removing it, then you stand a good chance of the lending accepting your application. If the surveyor recommends remedial work to remove the asbestos, then the lender won’t accept your mortgage application until the asbestos is taken care of. In this circumstance, you, your solicitors or your estate agents would contact the seller to see if this is something they’d consider doing and paying for. It's a good idea to get advice from an independent mortgage broker who has expertise in finding asbestos mortgage lenders if you think this may be required.

Can I Get a Mortgage for a House with Asbestos if a Lender Has Previously Declined My Application?

Even though one lender may reject your mortgage application because of asbestos, this doesn't necessarily mean others will refuse it too. One of our expert advisers will be able to look at your options and help you find the right lender for your circumstances.

Can I Get a Mortgage for an Asbestos Roof?

A house that has a roof containing asbestos is usually less of an issue for most lenders compared with properties where asbestos is part of the core fabric of the building. Many lenders will approve a mortgage application if the roof itself isn't damaged and is in good condition. It's still recommended to get a survey done on the property and roof to determine if the asbestos should be removed.

Should I Buy a House if It Has Asbestos?

Discovering that the house you’re looking to buy has asbestos is understandably worrying. After all, the serious health implications of asbestos are now widely known. While just hearing the word "asbestos" can be alarming, the most important thing to consider is whether or not the asbestos is exposed and if people could come into contact with it.

For instance, if the asbestos is in the roof and is unlikely to be disturbed, it’s usually safe and presents minimal risk. If the survey on a house you want to buy has flagged asbestos, the best thing to do is organise for a specialist contractor to assess the risk. This can be expensive, but it's worth it, even just for peace of mind.

If the survey shows that there's not much asbestos present and the work required to make the property safe is minimal, then the presence of asbestos need not deter you from buying the property but you will want to consider the implications if you intend to sell later on. However, if the survey finds large amounts of asbestos, the cost for either removing it or making the property safe could be thousands of pounds, which could mean you may want to rethink the purchase.

Can I Rent Out My Property if It Has Asbestos?

You can rent out a property that has asbestos but you must minimise your tenant's asbestos exposure risk as much as possible. You'll need to organise an asbestos survey to determine the extent of the asbestos and the degree of risk.

If the survey determines that the asbestos is safe and it is best to leave it undisturbed, you are not obliged to have it removed in order to rent out the property.

If you fail to monitor and maintain the asbestos appropriately, your tenants may decide to raise it with the local authority, or even sue you for breach of contract.

Asbestos and Mortgages: The Bottom Line

Contact our independent mortgage experts if you’re looking to purchase a property with suspected asbestos, or if you have any questions about getting a mortgage on a property with known asbestos.

At John Charcol, we have access to a broad range of lenders and mortgages - including the best deals and specialist lenders - so be assured we can help you find the right asbestos mortgage. Get in touch with us today on 0330 433 2927 or submit an online enquiry.