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  • FIRST POST
    • OceanMachine
    • By OceanMachine 11th Sep 17, 11:55 PM
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    OceanMachine
    Residential mortgage possible for Mixed Use property?
    • #1
    • 11th Sep 17, 11:55 PM
    Residential mortgage possible for Mixed Use property? 11th Sep 17 at 11:55 PM
    Hi all,

    Sorry for the long post, but I need some help in a bit of a strange situation...

    I am selling my only house and wishing to buy another residential property which would be my only property, and that I plan to live in.

    The property I am interested in is a normal residential house that has a workshop on the same title deed (but is a completely separate building with its own entrance door) that is physically adjacent to the residential house. The current usage of this workshop is registered as Light Industrial (B1(c) I think, but not certain), and was/is used as a joinery workshop by an existing business, whose owner lives at the house 'next door'.

    That business has/will stop trading and will no longer be using the buildings, and I planned to purchase this property (including the 'workshop') from them. The 2 buildings are on the same title deed.

    I understand based on the above that this would mean the purchase would be classed as 'mixed use', is that right? Is there any circumstance where this would not be the case, and I could get away with making it residential only?

    I theoretically wanted to borrow using a 90% LTV residential mortgage from my existing mortgage provider (a high street bank), and even though I mentioned this 'workshop' building to the mortgage provider during the 'decision in principle' meeting, no-one has mentioned it would be a potential problem before, but now I am not so sure...

    I planned to buy this and then use the 'workshop' as essentially a residential outbuilding - i.e. garage/worksop/man cave with no commercial or business usage, and I realise I would have to potentially go through Change of Use with the planning authority to do this, but I had a pre-planning advice meeting with them and they said that there is not really any need to change the use because as long as the property is not vacant and is 'in use' (even for a residential owner) then it would still be eligible for 100% business rates relief and so would not be actively costing me anything to keep it that way (rateable value is £9000).

    As I am planning on using this building for domestic/residential use as part of my only house (and could immediately inform the VOA that it is no longer a non-domestic building), but I wondered how this would affect the mortgage - would I still have to apply for a commercial mortgage, or is there any possibility that the bank might consider lending to me as a residential property - perhaps subject to me changing the use or something like that??

    I am confused and it seems like a very strange way of doing it and a waste of everyone's time and money if I proceed and then find out I can't borrow what I need, and especially as I intend to use it for domestic use anyway... essentially as if I was buying a residential house with a large (residential) outbuilding?

    [Extra info: There has previously been planning permission granted by the local planning authority to develop the land that the industrial building occupies into 3 separate dwellinghouses (i.e. knock it down and build a 3 x townhouse there or something like that), but this was granted to someone who lives nearby and does not own the actual building/land. I do NOT intend to make the land into separate houses or anything like that, I want to use it for my own use, being on the same deed as the house and so I thought I would mention this in case it makes any difference]

    What are my chances here, and the best way to proceed? What are the alternatives - I am not sure whether there are any other ways I can make this happen?
    Last edited by OceanMachine; 12-09-2017 at 12:13 AM. Reason: typo
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