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  • FIRST POST
    • Nsar
    • By Nsar 12th Oct 16, 5:31 PM
    • 13Posts
    • 5Thanks
    Nsar
    Too Much Land to Value on a Remortgage
    • #1
    • 12th Oct 16, 5:31 PM
    Too Much Land to Value on a Remortgage 12th Oct 16 at 5:31 PM
    This is a bit niche but I thought I'd share. Earlier this year we did a partial remortgage to buy a rental property. We did this with the aid of a respectable broker

    We live in an old farmhouse - the word Farm is part of property name. It's a rural area on the edge of a major city.

    We were exchanging and completing the same day on the other property and everything was fine until a few days before when the lender sent out a surveyor and then the next day rejected the remortgage. The reason given was that here was too much land with it (over 10 acres)

    We were amazed as our house has stables and is in a very popular equestrian area and people often push notes through our door asking to buy it.

    Apparently lots of land with a farmhouse = red flag to a lender (Santander) worried about selling the house if we defaulted.

    After 24 hours stress we found a lender (Woolwich) who were fine with it.

    One to be aware of.
Page 1
    • ACG
    • By ACG 12th Oct 16, 5:37 PM
    • 13,492 Posts
    • 6,634 Thanks
    ACG
    • #2
    • 12th Oct 16, 5:37 PM
    • #2
    • 12th Oct 16, 5:37 PM
    Broker should have picked up on this straight away. Some lenders have issues with land over 0.5acres, some with maybe 2 acres. All the stress could have been avoided, but you live and learn.
    I am a Mortgage Adviser
    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.
    • Bonfire Bride
    • By Bonfire Bride 12th Oct 16, 9:22 PM
    • 664 Posts
    • 817 Thanks
    Bonfire Bride
    • #3
    • 12th Oct 16, 9:22 PM
    • #3
    • 12th Oct 16, 9:22 PM
    Any ideas why it's a red flag? I would have thought that the additional land would be seen as added security?

    Genuinely intrigued.
    Mummy to 2 little boys born in 2013 & 2015
    House on the market for 19 months ....SOLD! ...complete!
    Natalie
    • Nsar
    • By Nsar 12th Oct 16, 10:37 PM
    • 13 Posts
    • 5 Thanks
    Nsar
    • #4
    • 12th Oct 16, 10:37 PM
    • #4
    • 12th Oct 16, 10:37 PM
    Because lenders like Santander think that house + land is a bit exotic. They want to lend on vanilla, look alike housing stock because the market for that is more predictable, therefore they can off-load quickly at a predictable value.
    The real market meanwhile sticks notes through our door asking to buy our house!
    Just big corporates not set up to look at things on a case by case basis.
    I understand that, but wanted others to be aware that this might be the case for them too if they have a more individual property.
    • amnblog
    • By amnblog 13th Oct 16, 10:30 AM
    • 8,849 Posts
    • 3,365 Thanks
    amnblog
    • #5
    • 13th Oct 16, 10:30 AM
    • #5
    • 13th Oct 16, 10:30 AM
    Because it leads to commercial, semi commercial, or agricultural use, not the market that residential lenders want to find themselves trapped in.

    Basic stuff for a broker.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, 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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