Wednesday, 7 December 2016

Are Lenders Putting Conveyancers in a Stranglehold over Knotweed Obligations?

HSBC is the third lender in the space of a three week period to impose new requirements in relation to Japanese knotweed.

In an update to their answer to 5.4.4 of Part 2 of the CML Handbook HSBC's new requirements reads:

Japanese Knotweed - You will need to advise the Bank if you become aware that there is, may be or has previously been Japanese Knotweed identified on or near the property.

Where Japanese Knotweed has not been identified within the boundaries of the property to be mortgaged to HSBC, but is present on neighbouring land over 7 metres from the boundary, we will rely on the Valuer to advise whether the property is suitable security.

Where Japanese Knotweed has been identified within the boundaries of the property being mortgaged to HSBC or on neighbouring land within 7 metres of the boundary, but is more than 7 metres from the habitable space being used as security, we can only proceed if any damage to outbuildings, paths and fences is minor. We will rely on the Valuer to confirm whether a Japanese Knotweed Survey is required and will require the following:

• A fully paid up Treatment plan which has commenced with an appropriately qualified person or company such as an accredited member of an industry recognised trade association such as the Property Care Association and the Invasive Non-Native Specialists Association

• A minimum 10 year insurance backed guarantee can be provided on completion of the works.
Where Japanese Knotweed has been identified within 7 metres of a habitable space at the property (either within the boundary of the property being mortgaged to HSBC or on neighbouring land) and/or the Japanese Knotweed has caused serious damage to outbuildings, paths and boundary walls, a Japanese Knotweed Survey is required in addition to the following:


• A Treatment plan which has been fully completed by an appropriately qualified person or company such as an accredited member of an industry recognised trade association such as the Property Care Association and the Invasive Non-Native Specialists Association

• A Completion Certificate that confirms the weed has already been fully remediated with a minimum 10 year insurance backed guarantee in place
All documents relating to Japanese Knotweed will be provided to the Valuer for their confirmation that the property is suitable for mortgage security and whether there is any impact on the valuation of the property.

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