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    hypermobility
    Buying unmortgageable property?
    • #1
    • 15th Jan 11, 7:37 PM
    Buying unmortgageable property? 15th Jan 11 at 7:37 PM
    Hi all,

    I'm flathunting in Scotland at the moment and saw a property yesterday which I love - ideal area and size, needs a lot of work but has the potential to be a really amazing property. I'm lucky enough to be a cash buyer and the flat is a repossession; I've been told by the estate agent that I'd probably get it for 25-30,000 under the valuation, which would free up about 30,000 to put into doing it up. Even factoring in the amount of money and work I'd have to put in, it'd still be a massive bargain.

    The problem: it's cash buyers only because the property has been deemed unmortgageable. This isn't a problem for me in the immediate, and if I do buy the place I'd be planning to stay there reasonably long-term (10 years plus), but obviously things change, you never know what's going to happen and I wouldn't want to end up in a position where, say, five years down the line I'm having to sell it at a massive loss because no one can get a mortgage for it.

    I've seen the home report, which flags up a number of problems, most of which were evident on viewing the property (mainly damp-related), but nothing that's a deal-breaker for me. The home report does mention the infamous Japanese knotweet to the rear of the property, which I suspect may be the reason why the place has been deemed unmortgageable, as I can't see anything else on the report major enough to warrant it (to put it in context, I viewed another place today that had rain pouring into it through a hole in the roof and that was still perfectly mortgageable!). Having a bit of a google, there seem to be companies that can deal with the knotweed (although I understand that it's a long and arduous process) and if I bought the property I'd be happy to cough up to get that sorted ASAP.

    So, I have a few questions:

    - would the knotweed alone be sufficient for the property to be deemed unmortgageable, or is there likely to be Something More Sinister?
    - if a property is deemed unmortgageable, who makes this decision, and what is it based on? Are there likely to be other documents (in addition to the home report) on which the decision would have been based, which I should request to see?
    - if you buy a property that's been deemed unmortgageable, does that make it difficult/impossible to get buildings insurance?
    - if a property is unmortgageable, does whomever makes this decision (a bank? a group of banks?) have to give a specific reason why they've deemed the property unmortgageable? What I'm trying to get at is, if I buy this place, am I going to be able to find out the exact reason why it was deemed unmortgageable and, if I fix the problem(s), is there a reasonable likelihood that the property will be considered mortgageable again when/if I decide to sell?

    Would appreciate any advice on this sort of thing. I will get on the phone to the estate agent, the council and try and find a lawyer first thing Monday, but it'd be good to have a better idea before then if possible!

    Thanks all.
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