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Compliance Cert, Commercial v PPR usage

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  • 17-10-2019 1:51pm
    #1
    fago
    Registered Users Posts: 318 ✭✭


    Trying to work through a somewhat complex purchase, which perhaps someone here may have some experience/guidance on. Obviously working with bank, solicitor and surveyor in parallel.

    Summary: Property has original planning for use as a single PPR. Currently broken up into a number of units and advertised as same.

    Bank offer team have said a PPR mortgage can only be drawn down if they have sight of planning permission for use as a PPR.

    Based on a planning search, it looks like the original permission from the 70s as a PPR is still active, and the vendors are using the property in a non compliant manner.

    In the normal course of drawdown the bank will look for a certificate of compliance.

    Question is if the bank looks for a certificate of compliance AND sight of permission for use as a PPR, how can both co-exist at the same time. We would need the vendors to apply for permission for use as commercial units (to get a compliance cert) and then before drawdown we need to revert the property back to the original active planning permission as a PPR.
    Or the vendors produce a cert of compliance to say it can be used as a PPR and they were using it in a non compliant way?


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    #2
    Gumbo
    Moderators, Society & Culture Moderators Posts: 38,436 Mod ✭✭✭✭Gumbo


    fago wrote: »
    Trying to work through a somewhat complex purchase, which perhaps someone here may have some experience/guidance on. Obviously working with bank, solicitor and surveyor in parallel.

    Summary: Property has original planning for use as a single PPR. Currently broken up into a number of units and advertised as same.

    Bank offer team have said a PPR mortgage can only be drawn down if they have sight of planning permission for use as a PPR.

    Based on a planning search, it looks like the original permission from the 70s as a PPR is still active, and the vendors are using the property in a non compliant manner.

    In the normal course of drawdown the bank will look for a certificate of compliance.

    Question is if the bank looks for a certificate of compliance AND sight of permission for use as a PPR, how can both co-exist at the same time. We would need the vendors to apply for permission for use as commercial units (to get a compliance cert) and then before drawdown we need to revert the property back to the original active planning permission as a PPR.
    Or the vendors produce a cert of compliance to say it can be used as a PPR and they were using it in a non compliant way?

    The bank won’t release funds in this case until somebody puts their insurance and name on paper to say it’s in compliance with planning regulations.

    Is it occupied?
    If not, some work needs to be done to make it a single dwelling rather than an apartment block.


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    #3
    antoinolachtnai
    Registered Users Posts: 9,773 ✭✭✭antoinolachtnai


    Class 13 in schedule Of exempted development here? I am not sure of the current status of this schedule or whether it is amended but maybe a letter from a planner would resolve this?

    http://www.irishstatutebook.ie/eli/2001/si/600/made/en/print#part2


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    #4
    Gumbo
    Moderators, Society & Culture Moderators Posts: 38,436 Mod ✭✭✭✭Gumbo


    antoinolachtnai wrote: »
    Class 13 in schedule Of exempted development here? I am not sure of the current status of this schedule or whether it is amended but maybe a letter from a planner would resolve this?

    http://www.irishstatutebook.ie/eli/2001/si/600/made/en/print#part2

    A Planner won’t give an opinion on planning status.


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    #5
    antoinolachtnai
    Registered Users Posts: 9,773 ✭✭✭antoinolachtnai


    Sorry, I meant a planner in the sense of a consultant who is a member of the Institute of Planners. (https://www.ipi.ie/consultants)

    It is really a matter of what the bank will accept.


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    #6
    Gumbo
    Moderators, Society & Culture Moderators Posts: 38,436 Mod ✭✭✭✭Gumbo


    antoinolachtnai wrote: »
    Sorry, I meant a planner in the sense of a consultant who is a member of the Institute of Planners. (https://www.ipi.ie/consultants)

    It is really a matter of what the bank will accept.

    Architect
    Engineer
    Building surveyor.

    They will offer an opinion or tell you they can’t due to the current layout. This type of property only really suits cash buyers looking to retain the sub division.

    If you are buying it as a PPR, then it needs to resemble a PPR.


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    #7
    antoinolachtnai
    Registered Users Posts: 9,773 ✭✭✭antoinolachtnai


    Well, in fairness, the bank aren't looking for it to resemble a PPR in this particular case, according to the OP. They are just looking for an assurance that there is planning in place for this use.

    They must know that if you just pull out a few kitchens, it will resemble a PPR again.


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    #8
    Gumbo
    Moderators, Society & Culture Moderators Posts: 38,436 Mod ✭✭✭✭Gumbo


    antoinolachtnai wrote: »
    Well, in fairness, the bank aren't looking for it to resemble a PPR in this particular case, according to the OP. They are just looking for an assurance that there is planning in place for this use.

    They must know that if you just pull out a few kitchens, it will resemble a PPR again.

    If it doesn’t resemble a PPR, no professional will issue a cert to say it is. I wouldn’t. I wouldn’t put my name or my PI on the line for it.

    So yes, then bank are not directly looking for it to resemble a PPR, but the certification they require may mean it will have to resemble a PPR in order for someone to issue that cert.

    The ball is in the vendors court here. They can either tell the op to move on, or get someone to issue a cert of compliance with the original PP. the problem is that the surveyor has most likely picked up on it, which means the solicitor will get wind of it, which means he has to tell the bank.

    Is the building occupied OP?


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    #9
    garhjw
    Closed Accounts Posts: 1,424 ✭✭✭garhjw


    kceire wrote: »
    If it doesn’t resemble a PPR, no professional will issue a cert to say it is. I wouldn’t. I wouldn’t put my name or my PI on the line for it.

    So yes, then bank are not directly looking for it to resemble a PPR, but the certification they require may mean it will have to resemble a PPR in order for someone to issue that cert.

    The ball is in the vendors court here. They can either tell the op to move on, or get someone to issue a cert of compliance with the original PP. the problem is that the surveyor has most likely picked up on it, which means the solicitor will get wind of it, which means he has to tell the bank.

    Is the building occupied OP?

    Totally agree. Definitely with the vendor to rectify unless they find cash buyer. Banks will be very risk averse in these scenarios.


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    #10
    antoinolachtnai
    Registered Users Posts: 9,773 ✭✭✭antoinolachtnai


    garhjw wrote: »
    Totally agree. Definitely with the vendor to rectify unless they find cash buyer. Banks will be very risk averse in these scenarios.

    Why does he need a certificate of compliance? The bank hasn’t asked for that.

    From my read the bank want to know whether the prospective purchaser will be legally entitled to carry out development he proposes.


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    #11
    Gumbo
    Moderators, Society & Culture Moderators Posts: 38,436 Mod ✭✭✭✭Gumbo


    antoinolachtnai wrote: »
    Why does he need a certificate of compliance? The bank hasn’t asked for that.

    From my read the bank want to know whether the prospective purchaser will be legally entitled to carry out development he proposes.

    I'm reading from the OP that he is obtaining a PPR Mortgage. Its currently a Commercial property, therefore a PPR mortgage cannot be drawn down for it.

    The OP states in his OP :

    In the normal course of drawdown the bank will look for a certificate of compliance.


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    #12
    fago
    Registered Users Posts: 318 ✭✭fago


    Thanks folks - posts here have pretty much confirmed what I understood. I have already gone back to vendor proposing the course of returning it to 1 property, allowing them to get a cert of compliance and providing the necessary PPR usage for us.

    The work to return it to single property isn't large, the whole downstairs is a substantial 3 bed, just need to open access to stairs again.
    Just depends on far you need to go (remove all kitchettes upstairs/more?) to have it certified as compliant by a surveyor.


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