Conversions and change of use
Warranty for a barn conversion or change of use
Converting a barn, a commercial building or a house into flats? Lenders treat a converted home much like a new one, but an old structure raises questions a new build doesn't. Here's what to expect.
Do you need a warranty for a conversion?
Not by law, but you'll probably be asked for one. The UK Finance Mortgage Lenders' Handbook treats converted homes in the same way as new ones: lenders will generally only lend on a newly built, converted or renovated home if it has a warranty or a Professional Consultant's Certificate (PCC).
So if you, your buyer or a future owner will need a mortgage, it's worth deciding this before work starts. That applies to:
- Barn and other agricultural conversions
- Commercial to residential, such as offices, shops and pubs
- Chapels, schools and other unusual buildings becoming homes
- Splitting a house or building into flats
- Substantial refurbishments that create new homes
Why conversions are different from new builds
On a new build, everything can be seen as it goes in. On a conversion, much of the structure was there long before anyone started work. Whoever assesses it has to look at the old as well as the new:
- Foundations. Older buildings can have shallow foundations, or none to speak of. Will they carry the new loads?
- Walls. Agricultural and older solid walls can have cracks, movement or poor bonding, and they may be taking new floors and roofs.
- Roof timbers. Are they sound and strong enough, particularly with insulation and new coverings added?
- Damp and timber decay. How is water being kept out of walls and floors that were never built for a home?
- New work tying into old. New floors, steelwork and openings have to work with what's there.
That's why you'll usually be asked for more up front, such as a structural engineer's report on the existing building.
PCC or insurance-backed warranty for a conversion?
A PCC is a certificate from a qualified professional who has monitored the work at key stages. It's not an insurance policy. An insurance-backed warranty is a latent defects policy from a provider. Not every warranty provider takes on conversions, and those that do may set extra conditions for the existing structure, so ask early.
A PCC is often used for conversions, particularly one-off projects and small schemes. Whether it's right for yours depends on what your lender, buyer or solicitor will accept. Our guide to PCC or structural warranty sets out the differences side by side.
Check your lender first
Some lenders are more cautious about conversions than standard new builds, and rules vary. Before you commit, ask your lender or broker these questions, and get the answers in writing:
- Will you lend on this type of conversion?
- Will you accept a PCC, or only an insurance-backed warranty?
- If it's a scheme of flats or homes, is there a limit on the number you'll accept with a PCC?
- What do you need before each stage payment, if you're releasing funds in stages?
If you're converting to sell, think about your buyers' lenders as well as your own. See PCC for a mortgage for more on what lenders look at.
Building Regulations still apply
Turning a building into a home is a change of use, and it needs Building Regulations approval as well as any planning permission. A completion certificate from Building Control shows the work was signed off, and lenders normally expect it as well as a PCC or warranty. It doesn't replace either.
Evidence to keep from day one
Good records make the inspections simpler and help if you ever sell:
- Photos of the building before work starts, and dated photos as it's stripped out
- The structural engineer's report and calculations
- Any damp, timber or roof surveys, and treatment records
- Planning decision, Building Regulations drawings and inspection records
Already finished, or part-way through? A retrospective PCC may be possible for eligible homes, depending on the evidence and on what your lender will accept.
Get a quote for your conversion
Send us the address, the drawings, any structural reports and how far you've got. We'll tell you what's needed and give you a fixed quote before you commit.
Common questions
Frequently asked questions
Does a barn conversion need a structural warranty?
It isn't a legal requirement, but lenders generally want a warranty or PCC on a converted home, so you'll usually need one if you, or your buyer, will have a mortgage. Check what the lender will accept before you start.
Can I get a PCC for a barn conversion?
Yes, barn conversions can be covered. The review also looks at the parts of the existing building being kept, so expect to supply structural information about them. Lender acceptance varies, so confirm it first.
What if my conversion is already finished?
A retrospective PCC may be possible, using drawings, dated photos, structural records, Building Control sign-off and an inspection. Some lenders won't accept one, so ask yours first.
Does a commercial to residential conversion count as a new home?
For lending, usually yes. The Handbook groups converted homes with new ones when it comes to needing a warranty or PCC. Individual lenders can have their own rules, so ask yours.
Can you cover a block of flats conversion?
Small schemes and flats can be considered, with a certificate for each completed home. Some lenders limit how many homes a site can have before they'll accept a PCC, so check the current limit with your lender or your buyers' lenders.
Planning or finishing a conversion?
Send the address, drawings and any structural reports. We'll tell you what's needed before you commit.