Financing and insurance

Bank practice

Some banks ask for an NMÉ at lending assessment for a steel-framed house. Be clear about this: it is not a legal requirement but the bank’s internal rule.

Under the legislation, for a site-erected frame an NMÉ or ETA cannot be required. When no system document is required.

The bank, though, decides under its own risk rules, and legal argument does not move it.

Which is why the order matters

Settle the question before the loan application, because it is hard afterwards:

1. Which bank you are applying to.
2. What that bank asks for with a light gauge steel building.
3. If it asks for a system document, whether one is available — from the contractor or the system owner, for example.
4. If not, whether there is an alternative bank.

Once construction is under way the room to manoeuvre is substantially narrower.

The valuation question

Lending involves a valuation. Here familiarity with the technology counts: a well-documented, properly built house presents no problem to value, while incomplete documentation breeds uncertainty.

So the existence of the handover documentation is measurable in money here too. Handover documentation.

Insurance

For buildings insurance the type of structure generally has to be stated. What to do:

• name the exact technology, not the catch-all “lightweight”,
• document the fire solutions,
• settle the question of reinstatement after a claim.

After a claim the insurer will ask what was installed and what verifies it — so the same documentation matters as at handover.

Saleability

In the long run this is the most important consideration. A well-documented building:

• can be valued faster,
• is easier to finance,
• and raises fewer questions for a buyer.

The point

What banks and insurers expect is not the same as what the law requires. Settle the difference at the start of the project — argument does not help afterwards.