An Environmental search is now considered a necessary part of a search bundle when purchasing a new property. The environmental search will identify if there is a potential risk of contamination but what do you do if the report is referred?
Standard procedure, once upon a time, was to contact the Local Authority for confirmation that they do not deem the land to be at risk. The trouble with contacting the Local Authority is that you are notifying the Local Authority of the risk, increasing the likely cost of any indemnity policy should a satisfactory response not be forthcoming.
Taking out a Contaminated Land Indemnity Policy could be the best way of dealing with a referred report. The policy would cover the potential purchaser in two ways, the first being the threat of enforcement action and the second providing peace of mind that should they sell the property any future purchaser would be protected against financial risk, thereby reducing the likelihood of them using potential land contamination as a bargaining tool.
Contaminated land policies cover the costs of remediation work required to comply with a Local Authority enforcement notice. A policy will also cover any property value decrease as a result of the enforcement notice. A win-win situation for your client should the unthinkable happen.
For more information regarding contaminated land policies you can contact STL
on 0800 318611.
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