Builder Taylor Wimpey is hit by further leasing controversy over Olympic Park

HOUSEBUILDER Taylor Wimpey has stoked further controversy over complex leasing arrangements for homes, after a would-be buyer was rejected for a mortgage at its high-profile development at London’s former Olympic Park.

Barclays said it had rejected a mortgage applicant trying to buy a property at Chobham Manor as it deemed the leasing arrangements too risky.

It is the latest leasing controversy to hit Taylor Wimpey after it was forced to set aside £130m last year to settle disputes over ground rents on leasehold properties. Barclays said it had refused to lend against the property at Chobham Manor as under the terms of the head lease it could be “disclaimed by the crown or by a liquidator or trustee in bankruptcy of the tenant”.

The bank said it was standard practice for lenders to reject such terms. It added: “Barclays does not assess the solvency of the head tenants when we lend against an underlease, and we have no control or oversight over the head tenant’s solvency throughout the term of our loan.”

The head lease is held by a vehicle joint-controlled by Taylor Wimpey and developer L&Q, while the freehold is held by the London Legacy Development Corporation.

Taylor Wimpey said it would amend the terms of its leases at Chobham Manor following Barclays’s concerns.

“We take any issues which may have the potential to impact the saleability or mortgageability of our customers’ homes extremely seriously,” it added.

However, the builder said it believed the leases complied with industry guidelines without the amendments and it would have required “a number of steps” on top of insolvency before the head lease could be forfeited.