Is it possible to re-mortgage on this?

kittywaa

Hi Everyone, just joined today as we are in need of some advice, could be a long post though, sorry
My father died last year and mum is now living with us.
House put on the market, valued at £154.000, no mortgage on it.
Had 3 sales fall through in a year and it looks as if another is about to fail.
The house has got some problems re subsidence so we have gradually reduced the asking price over the year and the last offer which we accepted was for £70.000 , cash buyer.
The buyer is having trouble getting insurance for it and may have to pull out.
What we are thinking of doing now is trying to get some money through remortgaging to pay for the repairs, then rent it out till the market hopefully picks up.
Has anyone got any advise as to wether this is possible please.
Thanks in advance

Conrad

Of course you will face similar problems to those your buyers encountered.

To explain the nub of the issue;

A mortgage is a loan, which entitles a lender to claim back the house and sell it if you default.

There is your problem, they wont be able to readily sell it.

Furthermore without insurance no lender will touch it because if it burns down they will not have a policy to claim against.

I know of one non status lender that charges about 13% interest and lends on most things so might be worth a go, but Im wondering how they would put a value on your property?
The lender might lend about 50% of the 'value'.

kittywaa

The insurance has just been renewed by us for another year.
We were looking to borrow about £30.000 to cover all the work.
13% sounds too expensive, what is the best solution ?
kitty

Conrad

There is no other solution if the property has subsidence, other than dont borrow - pay the cost out of your incomes / savings or do the work yourselves.

grogdog

do you have any equity in your own home taht can be uses to carry out the rapairs , you will then be able to get a mortgage on this property if you need to to pay your own back.

Toughluck

13% in the scheme of things based upon no-one is prepared to pay anywhere near the amount you want and that no lender really should be lending on this, is not too bad. as the end of the day it is a £30,000 loan. 6% or 13% the most your likely to pay interest only on 13% will be around £330 per month. Once the work is doen then you can, and justifiably so, sell it for £140,000 and make a real sale out of it. Reality check please.

Toughluck

Try blemain finance.

foreversummer

I might be being daft here, but surely if you have buildings insurance on the property this will cover you for all the work, underpinning etc. I know on my policy there is a £1000 excess.

Foreversummer

Toughluck

You are right and the £1,000 excess is standard. It does get complicated though but I do get where you are coming from.

opinions4u

As I understand it, your existing insurer should continue cover on the property for any new owner.

Why haven't you claimed on your insurance for the subsidence work?

kittywaa

Hi
Thankyou for all the replies, sorry,I have been away from computer.
The subsidence was not covered as it is an old problem which was already there when my dad bought the house (for cash without a survey)which we didn't know at the time.
We cant raise any equity ourselves as we rent.
We have also spoken to the insurer, Rias , and they have told us it is not transferable although they have told our buyer to ring them so all is not quite lost yet.
£330.00 per month is reasonable I agree but this is an 87 year old we are talking about and she has never had anything to do regarding finance as dad did it all.
Anyway am off to bed now and will check in the morning for any more replies.
Thanks again
kitty