Six mortgage lenders have confirmed they will now release finance on flats with outstanding Grenfell-related cladding problems.

In a joint statement with RICS, the lenders said the Building Safety Act gave them the reassurance they needed to start granting mortgages on affected flats.

The six lenders involved in the move are: Barclays, HSBC, Lloyds, Nationwide, NatWest and Santander

This development follows the launch earlier this week of a government initiative designed to free thousands of properties previously stuck in limbo, onto the market.

The Government Actuary Department (GAD) has developed a new professional indemnity insurance scheme, enabling many qualified surveyors to cover their External Wall System (EWS1) assessments.

Reassured

Lenders said there were several factors that had acted to reassure them.

“The introduction of the developer self-remediation scheme, plans to re-open the Building Safety Fund and a new remediation scheme for buildings between 11-18 metres will help to remove the financial risk to leaseholders in blocks of flats 11 metres and above,” they said.

“We also recognise that the costs for remediating non-cladding defects is capped in law for qualifying leaseholders.”

The statement added: “RICS (The Royal Institution of Chartered Surveyors) agrees that the Building Safety Act has played a critical role in unlocking the lending market regarding properties with cladding, and this will create a vehicle to allow valuations on all blocks of flats as identified above.”

Greg Clark, Secretary of State for Levelling Up, (pictured) said: “Unlocking the housing market for leaseholders in homes with fire safety issues is critical to helping innocent homeowners caught up in the building safety crisis to move on with their lives.

“I am delighted that the protections we have put in place for leaseholders as well as our agreement with major property developers have led to today’s commitments from six of the UK’s biggest lenders.

“This must now be translated into action, and I expect industry, especially lenders and valuers, to work with us quickly to fulfil these promises,” he added.