27 items found for ""
- 11. Completion | Gatehouse Bank Handb
11. COMPLETION 11.1 Offshore Seller If the seller of the property is not incorporated in England and Wales, the Bank's solicitors will need confirmation that the seller is active/solvent as at the date of completion before drawdown can take place. Please either provide a legal opinion, a certificate of good standing and a certificate of incumbency or a clear winding up/solvency search on the seller dated the date of completion. Please also ensure that the Seller is registered at Companies House and provide the Bank’s solicitors with the Seller’s official Overseas Entity number following completion. 11.2 Notice of Completion to the Bank The Bank requires five business days' notice of the intention to complete. All conditions must be satisfied five business days before completion for drawdown to take place. 11.3 Funds Remittance – when will they be available? Funds are sent from the Bank to the Bank's solicitors on the day of completion. The Bank's solicitors will deduct the necessary disbursements (as per the contribution statement sent to the Client's Solicitor) and send the balance to the Client's Solicitor by CHAPS. This is held to the Bank's solicitors' order. You must confirm to the Bank's solicitors when funds are received so that you can be released from your undertaking to hold funds to order. If completion does not take place on the day the funds are remitted, you must return funds to the Bank's solicitors by 2 pm next working day as funds will need to be returned to the Bank. The Bank’s solicitors may charge an admin fee if they are required to send funds to you again so please ensure that all parties involved are ready to complete before requesting funds. Back to Contents
- 1. Introduction and Purpose | Gatehouse Bank Handb
1. INTRODUCTION AND PURPOSE This document has been prepared for the use of conveyancers engaged to act for the Bank’s Clients in relation to Home Purchase Plans (“HPP”) and Buy-To-Let Purchase Plans (“BTLPP”) provided by the Bank. Due to the nature of these products, the Bank will be independently represented by its own solicitors on the finance aspects and management of the Conditions Precedents only. The Bank instructs you for the purposes of and will be relying on your Certificate of Title, which incorporates the Law Society and UK Finance approved Certificate of Title, and you agree to this. The Bank is a member of UK Finance but does not use the UK Finance Mortgage Lenders’ Handbook for Conveyancers (the “Handbook”). This document sets out information regarding the main queries generally raised by conveyancers and which may otherwise have been covered by the Handbook. Please ensure you raise any enquiries with the Bank which would ordinarily be answered within Part 2 of the Handbook. Where a contact point is usually requested under the Part 2 requirements, please refer all enquiries to the Bank's solicitors to review and confirm whether the Bank will agree to proceed. Please assume that the Bank requires instructions to be taken on all matters before you can proceed. Back to Contents
- 8. Insurance | Gatehouse Bank Handb
8. INSURANCE 8.1 New Home Warranty Schemes If the property has been constructed or converted in the last 10 years a new build warranty will need to be provided. The following schemes are acceptable to the Bank: a) NHBC; b) Premier Guarantee (Including LABC); c) Building Life Plans (BLP); d) Checkmate; e) Global Home Warranties (GHW); f) International Construction Warranties (ICW); g) Protek; h) Buildzone; i) The Q Policy (Q assure); and j) Advantage HCI. k) FMB Insurance /Build Assure l) One Guarantee m) Ark Residential New Build Latent Defects Insurance n) ABC+ Warranty (10 year structural warranty) o) CGICE (Casualty & General Insurance Company (Europe) Limited ((if the final certificate is dated 04/09/2019 or earlier The limit of indemnity must be for an amount that is not less than 30% of the reinstatement value shown on the Offer Letter. Any other new homes warranty schemes not mentioned in the approved list above will need to be submitted to the Bank's solicitors for approval. A copy of the new build warranty and cover note should be sent to the Bank’s solicitor following completion. 8.2 Indemnity Insurance For any indemnity insurance provided, the limit of indemnity (sum insured) must be the full market value of the property or the purchase price (whichever is higher). Please ensure that copies of all indemnity policies are sent to the Bank’s solicitor following completion. 8.3 Absent or Insolvent Landlords The Bank will accept absent or insolvent landlords subject to Absent landlord insurance and Contingent building insurance are in place. The above is only acceptable if all the following conditions are satisfied: i. the level of cover afforded is for the full market value of the property; ii. the bank’s interest is noted or a general finance providers interest clause is included; iii. the policy contains a non-invalidation provision; and iv. that the solicitor providing the COT considers that the bank’s interest is sufficiently protected by the policy and that the property will continue to have good and marketable title 8.4 Buildings Insurance For freehold and leasehold properties, you must ensure that a valid buildings insurance policy is in place to cover against the Insured Risks and the interest of successors in title/leaseholders noted on the policy schedule for an amount that is not less than the reinstatement value shown on the Offer Letter. The Bank does not require its interest to be noted on the policy. Back to Contents
- New Build Conditions | Gatehouse Bank Handb
New Build Conditions If required, please use the certificate of compliance template below. Download
- 5. The Documents | Gatehouse Bank Handb
5. THE DOCUMENTS 5.1 Original documents Where you receive initial instructions from the Bank’s solicitors on or after 1 October 2024: Certified copies of all original documents signed by the Client, or any third parties must be provided to the Bank's solicitors at least five business days before completion. You will need to retain the original finance documents signed by your Client for your Land Registry applications. Where you receive initial instructions from the Bank’s solicitors before 1 October 2024: All original documents signed by the Client, or any third parties must be provided to the Bank's solicitors at least five business days before completion. 5.2 Additional Documents Documents are sent to the Bank in one pack for execution. Therefore, where additional documents are envisaged (e.g., deeds of covenant, licences, transfers, etc.), execution versions will be required as soon as possible (and no later than seven business days before completion) to ensure there is no delay in arranging execution by the Bank. 5.3 Amendments to Agreements The Agreements are in the Bank's standard form and cannot be negotiated nor amended in any way. 5.4 Witnessing Documents All Agreements are required to be witnessed by an independent, mature, third-party witness with no involvement in the transaction. The Client's Solicitor can witness the documents, but it is not a requirement of the financing that they do so. 5.5 Offer Letter Offer Letters are valid for four months from the date of first issue by the Bank. If an Offer Letter was issued prior to 15th November 2023, it is valid for six months from the date of first issue. Please refer to the offer wording to ensure you advise your client correctly. The Bank will need to obtain credit re-approval to proceed after the offer has expired. You must advise the Bank's solicitors immediately if completion will not be taking place before the offer expires. Back to Contents
- 12. Post Completion | Gatehouse Bank Handb
12. POST COMPLETION 12.1 Registration (a) Land Registry Where you receive initial instructions from the Bank’s solicitors on or after 1 October 2024: You will be responsible for dealing with registration at the Land Registry. To confirm, the registrations will usually include the following: registration of the transfer or lease to the Bank; noting the promise to sell the Property in favour of the Client on the Property title held by the Bank; registration of the lease from the Bank to the Client (if for a term over seven years) or noting the lease on the Property title held by the Bank (if for a term of seven years or less); and registering the Bank's legal charge over the leasehold title if the lease is registrable pursuant to (iii) above. The consideration and/or the price paid/value to be quoted on Land Registry applications is the purchase price paid to the seller/transferor of the property or, in the case of a re-finance, the property value (not the finance amount). If the Client’s interest is held jointly, it is the responsibility of the Client’s solicitor to record properly the way in which property is held as joint tenants or tenants in common. Where you receive initial instructions from the Bank’s solicitors before 1 October 2024: The Bank's solicitors will be dealing with registration at the Land Registry. You are required to give an undertaking to assist the Bank's solicitors with any correspondence and requisitions raised by the Land Registry (this will be included in the template completion undertaking letter provided to you by the Bank's solicitors during the transaction). To confirm, the registrations will usually include the following: i. registration of the transfer or lease to the Bank; ii. noting the promise to sell the Property in favour of the Client on the Property title held by the Bank; iii. registration of the lease from the Bank to the Client (if for a term over seven years) or noting the lease on the Property title held by the Bank (if for a term of seven years or less); and iv. registering the Bank's legal charge over the leasehold title if the lease is registrable pursuant to (iii) above. v. The consideration and/or the price paid/value to be quoted on Land Registry applications is the purchase price paid to the seller/transferor of the property or, in the case of a re-finance, the property value (not the finance amount). If the Client’s interest is held jointly, it is the responsibility of the Client’s solicitor to record properly the way in which property is held as joint tenants or tenants in common. (b) Companies House If the Client is a corporate entity the Bank's solicitors will deal with the registration of charges (i.e. the Legal charge) at Companies House. 12.2 Removal of Security If the Client is a corporate entity and there is existing security registered against the Client at Companies House, you are required to apply to discharge these on completion and confirm the same to the Bank's solicitor. 12.3 Legal Representation on Redemption The Bank will be represented by its own solicitors on redemption. They will arrange for the transfer of title and discharge of the legal charge affecting the property and release of any debenture granted by the Client. Please note that the Client will need to appoint solicitors to represent them in respect of the redemption. The Bank’s solicitors will not be able to represent the Client jointly with the Bank during the redemption process. This is to avoid a potential conflict of interest, as they would be acting for both the buyer and seller of the title. Back to Contents
- Corporate Customer Conditions | Gatehouse Bank Handb
Corporate Customer Conditions Please download, complete and return a certified copy of the Board Minutes. Board Minutes (more than one director) Minutes and Resolution (sole director) Please download, complete and return a certified copy of the Director's Certificate. Directors Certificate (more than one director) Directors Certificate (sole director) Please download, complete and return a certified copy of the Shareholder Resolution. Shareholder Resolution - Conflict of Interest (more than one shareholder) Please download, complete and return the Guarantor Letter of ILA. Independent Advice Letter – Guarantor If a guarantor is based overseas, please download, complete and return a Guarantor Process Agent Letter. Process Agent Letter – Guarantor Download Download Download Download Download Download Download
- 16. Policy Exceptions | Gatehouse Bank Handb
16. POLICY EXCEPTIONS Any exceptions to this policy must be approved by MCIC. Exception requests should comprise a clear rationale and support from the Banks solicitors. Additionally, these requests should be vetted by Risk and Legal Counsel, before being considered for MCIC submission. Back to Contents
- 7. Stamp Duty Land Tax | Gatehouse Bank Handb
7. STAMP DUTY LAND TAX (SDLT) and CAPITAL GAINS TAX (CGT) 7.1 Submitting Returns and paying SDLT You are required to draft and submit all Stamp Duty Land Tax Returns (Return) and pay any SDLT due to HMRC within the relevant time frame. A return is required for each disposal. You will need to provide copies of all Returns to the Bank's solicitors to review and approve. In relation to the Return where the Bank is the purchaser, your firm will be noted as the agent and the Bank's solicitors will confirm that the Return is satisfactory and provide you with authority to submit this on the Bank's behalf. The Bank will not sign the Return unless you are submitting a postal Return. Where you receive initial instructions from the Bank’s solicitors on or after 1 October 2024: You will need to retain the SDLT5s for your Land Registry applications. Where you receive initial instructions from the Bank’s solicitors before 1 October 2024: You will need to provide the Bank's solicitors with the SDLT5s for each Return in accordance with your completion undertakings. Please note the following: a) There are usually three stages for each transaction: i. the transfer of the property from the Client/seller to the Bank; ii. the Lease from the Bank to Client; and iii. the transfer from the Bank to the Client on maturity. b) On a refinance, all three stages (i) to (iii) are exempt from SDLT under the alternative property financing rules (refer to the Finance Acts). In box 9 of the Return, the answer will be 'yes' and the code will be 24 and boxes 14-15 will be £0.00 as no SDLT will be payable. c) On a purchase, stage (ii) and (iii) are exempt from SDLT under the alternative property financing rules however stage (i) (where it is a transfer from the seller to the Bank) attracts SDLT in the usual way and is payable by the Client. d) If on maturity, if the Client sells the property and the Bank is required to transfer it to a third-party buyer, the buyer will pay SDLT in the usual way. If the Client is not selling the property and the Bank is required to transfer it back to the Client, the Client will not be required to pay SDLT (see paragraph (b) above). e) If the Client is buying a new build property and the developer is unable to grant the lease directly to the Bank, there will be an additional stage (making it four stages). In which case, SDLT is payable on the initial lease/sale from the developer to the Client, and the remaining three stages (i) to (iii) above are exempt. The Land Registry's Practice guide 69 deals with Islamic Finance and SDLT on Diminishing Musharakah at section (3)(2). https://www.gov.uk/government/publications/islamic-financing/practice-guide-69-islamic-financing#diminishing-musharaka-partnership You may also wish to refer to the Finance Acts which contain provisions on alternative financing and the tax treatment here. 7.2 SDLT Additional Relief If you are proposing to use any relief other than code 24 (e.g. group relief or multiple dwellings relief) you are required to expressly provide the Bank's solicitors with a copy of the tax advice received by the Client confirming why the relief has been sought and on what grounds for our information only. The Bank's solicitors may need to refer this to their tax team for comments. 7.3 SDLT Rebates Please advise your Client that it is their responsibility to trigger the process where an SDLT rebate is applicable. Your Client/your firm should advise the Bank/the Bank’s solicitor as soon as you become aware that a rebate is to be applied for. 7.4 Capital Gains Tax (CGT) In respect of refinancing under a purchase plan, a share in the property to be financed is sold by the customer to the Bank (this share is then leased by the Bank to the customer). We understand that, on a strict reading of legislation, there is a potential capital gains tax charge triggered by this sale if it is deemed a disposal for CGT, there has been a gain in value for the customer since the property was purchased and no exemption, such as private residence relief, applies. The customer should be advised, if they deem it necessary, to seek their own tax advice or make representations to HMRC in this regard. We are happy to provide details of the financing structure to assist with this. 7.5 Tax Planning It is the customer’s responsibility to declare any tax planning at the outset and the Bank reserves the right to take further advice on the same, at the customer’s cost. Back to Contents
- 4. Leasehold Queries | Gatehouse Bank Handb
4. LEASEHOLD QUERIES 4.1 Notices to Landlord/Management Company Where required, any notice of transfer, sublease and charge are to be served pursuant to the Superior Lease (meaning the lease (if any) by which the Property is vested in the Bank) by the Client's Solicitor once completion has taken place. You must provide copies of the receipted notices to the Bank's solicitors. The Bank's solicitors will provide you with template notices during the transaction for you to complete and submit along with the required fee. 4.2 Shares in the Freehold/Management Company The Client's Solicitor is required to confirm if there is a management company and whether a 'purchaser' (i.e., the Bank) is required to become a member or shareholder of the management company. The Bank would prefer your Client to become a member or shareholder of the Management Company but acknowledges that this may not always be possible. If your Client becomes a member or shareholder, the Bank will require a signed, but undated, stock transfer form to allow transfer of the management share(s) to the Bank if required. Please liaise with the management company and/or freeholder to confirm whether your Client can become the member of the management company. If that is not possible, please confirm whether the Bank must become a member and what is required for the Bank to become a member and provide the forms for completion. If the Bank is required to become a member or shareholder, please confirm with the Management Company and/or freeholder if your Client can be appointed as the Bank’s Proxy, as that would be the Bank’s preference. 4.3 Energy Service Agreements Where the lease requires the leaseholder to enter into an energy service agreement, you should ensure that the Client can enter into this instead as the underlesee. 4.4 Alienation Restrictions in the Superior Lease Please ensure you review the alienation provisions and restrictions in the Superior Lease as soon as possible and liaise with the relevant third parties urgently to obtain any consents and/or licences and/or deeds of covenant required for the transaction. Please note that where any licences, deeds of covenants or Leases need to be executed by the Bank, we expect these documents to be fully vetted by your firm as the certifying solicitor. Any unusual terms must be reported to us in an addendum to the Certificate of Title for consideration. All costs associated with any such documents and notices must be borne by the Client. For ease, please note that there are multiple stages to this facility including: a) the transfer of the property to the Bank from either the seller or Client; b) the Lease from the Bank to Client; and c) the charge granted from the Client to the Bank. Please note, the Lease (between the Bank and the Client) is drafted so that it terminates on the Final Completion Date (as defined in the Diminishing Musharakah Agreement) at which stage the Bank has promised to sell the property to the Client and the Client has promised to buy the property from the Bank. Therefore, the Lease does not provide security of tenure which may assist in analysing whether consent is required under the Superior Lease. Please also note that the Lease requests the Client to give the following covenant in the Schedule, paragraph 6: "To observe and perform and comply with the lessee's covenants in any Superior Lease (if any) to the extent that those covenants are not already required to be complied with under the provisions of the Lease". If the landlord and/or management company have confirmed that a requirement in the Superior Lease is waived in light of the financing structure, you must provide the Bank's solicitors with written evidence to be relied upon. 4.5 Ground Rent limits You must flag to the Bank's solicitors whether the current or future ground rent will exceed 0.2% of the value of the property. The Bank's solicitors will report this to the Bank and valuer for consideration. The Bank will not accept ground rent reviews that are reviewed more frequently than every 5 years against RPI or equivalent index. 4.6 Seller/Developer unwilling to transfer to Bank If the developer and/or seller does not agree to directly grant the lease of/sell the property to the Bank, the structure will be as follows: a) the lease/sale from the developer/seller to the Client; b) the transfer of the property from the Client to the Bank; c) the Lease from the Bank to the Client; and d) the charge granted from the Client to the Bank. All four stages (a) to (d) above will take place simultaneously. The Bank will not take an assignment of the contract. The contract must have been entered into only by the Client. 4.7 Lease Term The minimum unexpired lease term for any leasehold property must be 70 years from the date of completion, subject to 40 years remaining at the end of the finance term. The Superior Lease must not contain any onerous or unusual covenants or restrictions. There must be no outstanding disputes in relation to any breach of provision and all sums due under the Superior Lease must be paid up to the date of completion. Where the Superior Lease term is shorter than the valuer has indicated in their valuation, this should be flagged to the Bank's solicitors to refer back to the valuer for consideration. 4.8 Leasehold Interest with Freehold Charge Where the client holds/is purchasing the leasehold and the Client also owns/will own the freehold interest in the property, the Bank will require (in addition to holding registered leasehold title as per the diminishing Musharakah structure) a charge over the freehold interest as well. Where a leasehold is being financed and your Client or the ultimate beneficial owner of your Client owns or controls (whether through shareholding, directorship or otherwise) the freehold, the Bank will require a charge over both the leasehold and freehold. 4.9 Enfranchisement Following completion, the Bank will become the registered proprietor of the title to the Property and this could affect your Client’s ability to make an application to extend the lease or acquire an interest in the freehold/superior title. The Bank would prefer not to be involved with any such application and so your Client should arrange for any such transaction to take place before completion. 4.10 Building Safety Act 2022 If the Property is leasehold, you must determine whether the property is located in a ‘relevant building’ as defined in the Building Safety Act 2022. If the Property is impacted by the Act, you must procure and confirm: a) Confirmation as to whether the building has been or will be remediated under the Building Safety Act 2022. b) Copies of any Landlord’s Certificates, signed by the Landlord in the form set out in the Building Safety (Leaseholder Protections) (England) Regulations 2022. c) Copies of any executed Leaseholder Deed of Certificate (in the form set out in the Building Safety (Leaseholder Protections) (England) Regulations 2022) and confirmation that they have been submitted by the relevant leaseholder to the landlord. d) The developer has signed a Developer's Remediation Contract with the Government. If any of the above cannot be confirmed, please refer to the Bank for further instructions and comments from the valuer. In all cases, you must advise your client of the consequences, including any unavailability of a cap on a financial contribution to remediation costs through the service charge levied by the freeholder and your client’s liability to the Bank for those costs under the Purchase Plan terms and conditions. Back to Contents
- 10. Disclosures | Gatehouse Bank Handb
10. DISCLOSURES 10.1 Disclosures to the COT If the Client's Solicitor wishes to disclose any issues, then the Client's Solicitor should set out such issues in a disclosure letter appended to the COT. The Bank's solicitor will then refer these matters to the valuer for confirmation that the valuation remains unaffected considering the disclosures. 10.2 Disclosure of Incentives Please ensure you report on all incentives and provide a disclosure form substantially similar to the UK Finance Disclosure Form to be referred to the valuer. 10.3 Environmental Reporting If the contents of the environmental report or contamination report you have commissioned is likely to affect the Bank's security, the Bank's solicitors will require a copy to be provided to them as a disclosure to the COT. 10.4 EPC Ratings All the security properties must meet minimum EPC rating threshold of ‘E’. 10.5 Licences a) Buy-to-Let Purchase Your Client is responsible for ensuring any mandatory, additional/discretionary, selective or other licence required to let the Property is in place before the Property is occupied by tenants. b) Buy-to-Let Refinance You must satisfy yourself that either: i) Any licence required to let the Property is in place on completion, or ii) Where a licence other than an HMO licence is required but is not currently in place, you are satisfied an appropriate application for the required licence has been made by your Client before completion. 10.6 HMO Licenses – Refinance Bank solicitors will require a confirmation that the property has a valid HMO license before completion. 10.7 Title Guarantee The Property must be transferred to the Bank with full title guarantee. Limited title guarantee is acceptable in some instances whereby the seller cannot provide full title guarantee (e.g., where probate sale or the seller lacks capacity or is a mortgagee in possession), provided an indemnity policy in place protecting the Bank's interest. 10.8 Unencumbered Title On completion, the Bank must obtain unencumbered title to the property and to any other Bank's interest forming part of the Bank’s security under the Transaction. Accordingly, any existing charge affecting the property (including under a debenture, or a fixed or floating charge) must be released on or before completion. Mere confirmation of non-crystallisation of an existing charge and/or an arrangement for the Bank to jointly hold the title or interest (even if in priority to a third party), is not acceptable. 10.9 Flying Freehold Conditions If the Property is a flying freehold, please advise the Bank's solicitors immediately. The Bank will require the following conditions to be met: a) the Client's solicitor or the valuer should confirm what percentage of the floor area will be affected by the flying freehold – this will determine whether the Bank can agree to lend or not; b) assuming the Property is not yet split, the transfer of the freehold property must have all necessary rights of support, protection, and entry for repair. The Client's solicitor must also provide confirmation of how the Property is accessed, i.e. does it have a separate access way, etc.; c) the Property must have enforceable restrictive and positive covenants that are also such that subsequent buyers are required to enter into covenants in identical form (since positive covenants do not run with the land). This will include ensuring that there is an adequate restriction placed on both freehold titles for Deeds of Covenant to be entered into by successors in title; d) the Client's solicitor should provide flying freehold indemnity insurance to the Bank's solicitors for approval; and e) the Client's solicitor will need to certify that the Property has good and marketable title. 10.10 Crisscross Leases (Sometimes known as “Tyneside Leases”) In circumstances where the Bank is financing one of two leasehold flats in a building where the Client holds the leasehold to one flat and the freehold reversion of the second flat and the other leaseholder owns the leasehold to the other flat and the freehold reversion in the Client’s flat, we require both the leasehold and freehold titles held by the client to be transferred to the Bank. Back to Contents
- Documents We Need From Your Client(s) | Gatehouse Bank Handb
Documents We Need From Your Client(s) If any of your clients based overseas, please download, complete and return a Process Agent Letter. Download