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    • roisinford
    • By roisinford 19th May 17, 8:44 PM
    • 6Posts
    • 1Thanks
    roisinford
    Help - no mortgage approval without work on house
    • #1
    • 19th May 17, 8:44 PM
    Help - no mortgage approval without work on house 19th May 17 at 8:44 PM
    Hi all
    Getting to the end of my tether with our mortgage lender. They have taken nearly 7 weeks to come to the conclusion that the house we are buying needs work doing on it BEFORE they will approve the mortgage. Cavity wall ties need replacing but we can't buy until this is done. I have never heard of this happening before... I've heard of conditional mortgages but not no approval at all. The vendor is now having to come up with nearly £2k to get this work done. As you can imagine he is not happy.

    The reason for my post is I'm getting very little information from my mortgage advisor about what is happening and I guess I want to know if this is normal or not. I'm surprised the MA hasn't suggested we apply for another mortgage, although this one has taken so long to get to this point. The vendor hasn't agreed yet so I'm in an information vacuum yet again. Would the vendor be crazy to not just do the work? Is there anything I can do, as the buyer?
Page 1
    • Lilla D
    • By Lilla D 19th May 17, 10:43 PM
    • 316 Posts
    • 161 Thanks
    Lilla D
    • #2
    • 19th May 17, 10:43 PM
    • #2
    • 19th May 17, 10:43 PM
    Lenders normally follow what the valuer recommends. If things are so bad that the valuer/surveyor picked up on it, there's a chance that even if you went to another lender, their valuer would also pick up on it and recommend the same course of action. You're right that some lenders may just retain part of the mortgage until the works are carried out and the valuer is satisfied. However, this is not really something that a broker could guarantee even if they pre-discussed the case with the lender and the valuer, as ultimately the valuer will want to see things before making any comments/recommendations.

    Without knowing the ins and outs of why it took 7 weeks to get to this point, it's impossible for anyone to comment on it, but it does happen, especially as it seems that it's because of some problems with the property. Jumping ships (switching lenders) is not necessarily the first or the best option that a broker will consider unless it becomes clear that the subject application cannot proceed.

    Re what you could do - if it's £2k to do the necessary works, you could offer to pay for it or split the costs, as it's a relatively small sum (I mean, it's not like coming up with £20k extra). Normally the solicitors can help write an agreement to cover both parties.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • roisinford
    • By roisinford 23rd May 17, 3:43 PM
    • 6 Posts
    • 1 Thanks
    roisinford
    • #3
    • 23rd May 17, 3:43 PM
    • #3
    • 23rd May 17, 3:43 PM
    Now the seller is saying they can't afford to pay for the work. So estate agent is asking us to pay for it. But how can we?!

    We don't own this house! It may all fall through and then we've spent nearly £2k on structural work to a house that we don't own (and never have!)

    I've asked them to go back to the mortgage lender and ask for a conditional mortgage. Although it seems to me that the lender is saying the house isn't worth the money we're paying for it. We offered low (and were accepted), we're not paying the asking price.

    I think this purchase may end badly I don't see how this can all go ahead with work needing doing on a house, I now can't get a mortgage due to this work needing doing. It's ridiculous.
    • Lilla D
    • By Lilla D 23rd May 17, 9:49 PM
    • 316 Posts
    • 161 Thanks
    Lilla D
    • #4
    • 23rd May 17, 9:49 PM
    • #4
    • 23rd May 17, 9:49 PM
    Just thinking out loud based on past experience of clients, but you should seek legal advice:
    - you could have an agreement drawn up with the solicitor's help to say that you'll pay an extra £2k at the time of completion to reimburse the costs, but in the meantime the seller has to finance it (credit card/family help?)
    - if all the legals are completed, you could exchange contracts paying £2k with the condition that they do the work in order to secure the mortgage and once that's done, you pay the deposit and agree on the completion date. An exchange of contracts ensures that the seller doesn't pull out, but it also ties you in.
    - have an agreement drawn up about sharing the cost

    As said, these are things that clients did in the past, but you'd need proper legal advice, so the above is not a recommendation, merely sharing experience.

    From a mortgage point of view, please see my first post - you could try a different lender, but there can be no guarantees that you won't end up with the same valuer (and hence the same result) or a different valuer would come to a different conclusion.

    If you are buying cheap, normally there is a reason why you could get that price and in this case you may either have to fork out the extra £2k, try your luck with another lender or just look for another property...
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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