Help - how do I buy this house?

bitsandpieces

Given what you know about the problems with the place, you are going to have a proper survey before exchanging contracts?

typeractive

bitsandpieces wrote: »

Given what you know about the problems with the place, you are going to have a proper survey before exchanging contracts?

Well this is my problem. I am happy to have the survey - no problems there. Though my mortgage advisor has said that the lender will only carry out one survey. Is this correct? His words:

Only one survey would be done - so you would need to get the work done first - they wouldn’t re-asses it - they would just decline you - so you would
need the work done prior to a valuer going out

Personally I would have thought that I would have the initial survey, then the opportunity to carry out certain works to the property allowing me to qualify for the mortgage when the surveyor would return to check everything is ok?

If they will only carry out one survey, then I'd have to get the work done prior to the survey (but that's catch 22 - how would I know if it won't fail on another problem?)

My parents have considered remortgaging their second home to release funds for me to buy cash. I could then do the work necessary and remortgage the property to pay my folks back. To be honest it's something I REALLY don't want to do, as much as I am a VERY honest and reliable son, and would make sure they get EVERY penny back, I just feel a bit uncomfortable...though maybe it's the best option?

bitsandpieces

I don't see a reason why you can't hire a firm to do a survey prior to exchange (not through your prospective lender) and then get the lender to carry out a valuation survey after the work has been done. Check this with your mortgage adviser, though.

mlz1413

haven't read your whole thread but top and bottom seems to be the lender will only carry out one inclusive cost survey.

Get an agreement from the lender that you can supply your own survey and that will be acceptable.

I'd recommend spending on a full structrual survey is £1000 spent now maybe worth £10,000 after you buy it.

Other option is ask lender if reducing LTV would help, if so then request vendor drops price by remedial works.

If none of the above work walk away - this is probably wy 2 previous sales have fallen through, take the history as advise rather than a challenge.

typeractive

Thanks - I didn't realise that would be an option: getting an independent surveyor.

This is why I don't understand why a lender would not allow an initial survey, then let me proceed at my own cost. Then on completion of the property being habitable, revisit and make sure the property is work is satisfactory and allow them to release the funds. It just sounds silly.

poppysocks1

In a different situation but we are getting an independent surveyor to do a full building survey on a property that we have made an offer on, and been accepted, and then once we have the results back on the survey will instruct the solicitor and mortgage company to go ahead and do the mortgage valuation survey, so in our case we are getting 2 surveys done, first is independent, and the second one is for the purpose of securing the mortgage, and there is no reason why we cant do that (in fact we did it last time when offered on a property but due to survey showing the property needed a lot of work had to pull out). Good luck, i hope you manage to sort it out.

silvercar

typeractive wrote: »

This is why I don't understand why a lender would not allow an initial survey, then let me proceed at my own cost. Then on completion of the property being habitable, revisit and make sure the property is work is satisfactory and allow them to release the funds. It just sounds silly.

You can do it that way when you are happy for a lender to apply a rentention of some funds. They would only be released when the second inspection shows the necessary work has been done. I doubt it will work in your case because the lender would want a basic kitchen and some sort of heating, to define the place as habitable, before the will lend a penny.

poppysocks1 wrote:

In a different situation but we are getting an independent surveyor to do a full building survey on a property that we have made an offer on, and been accepted, and then once we have the results back on the survey will instruct the solicitor and mortgage company to go ahead and do the mortgage valuation survey, so in our case we are getting 2 surveys done, first is independent, and the second one is for the purpose of securing the mortgage, and there is no reason why we cant do that (in fact we did it last time when offered on a property but due to survey showing the property needed a lot of work had to pull out). Good luck, i hope you manage to sort it out.

Agree. Exactly what we did. You should get your own surveyor do to a full structural survey. Then, if you are happy to proceed, you can apply for a mortgage and get the cheapest valuation to go with it.

silvercar

typeractive wrote: »

My mortgage advisor has came back to me with another option. He has spoken to a lender who may be willing to offer me a 'bridging' deal.

This would be the process:

It would involve him lending me the money + your deposit - but no survey

So it would pan out like this..

1) exchange and complete in the normal way
2) he has a legal charge over my house (in the same way a lender would)
3) I carry out the works
4) I remortgage and pay him off

The cost for this would be approx £700 and work hopefully completed to pass the survey in 2 months (intially). There would be legal costs involved also, though my mortgage advisor doesn't seem to think this would be too much.

Any opinions? Indeed a risk. It's obvious the property is more geared towards cash buyers at the minute.

You need a cast iron guarantee that the price to release the charge is only the agreed price. £700 looks cheap, I would expect 1% arrangement plus interest at slightly higher than normal rates for the length of time the money is borrowed.

Most lenders are not agreeing remortgages (as yours would be, being you would own the property) until 6 months after ownership. Do check this, some brokers tell the lender that it is a purchase and not a remortgage.

The risk is you not being able to get the remortgage eg if prices fall or you lose your job.

typeractive

Thanks guys.

At the moment it is looking like this - the vendor has agreed to me doing the work necessary (hopefully just install the boiler), prior to the valuation. Not always a 'safe' option and indeed quite a risk. The only benefit I have is the vendor being a large company, not a resident. Of course I need my legal chap to ensure this in agreement.

This would mean a process of:
1. My offer oficially agreed with the AIP. House taken off the market.
2. Arrange for keys to be released.
3. Work quoted for and carried out.
4. Mortgage surveyor visit
5. Head towards completion (if everything is fine).

Taking on board the advice of using an independent surveyor to assess the house, how do I source a good surveyor and how much should I be looking to pay (roughly)? I guess having the survey would come at step 1.a? lol

Fire_Fox

If the house is not mortgageable then I suspect it isn't worth the price you have agreed with the vendor. The value of a property is what it's worth on the open market in it's current condition NOT (as many people think) the price of the house completed minus the cost of the work needed to make it habitable. This house isn't worth much on the open market if you are the third prospective purchaser to have problems getting a mortgage. In it's current state it will only sell to a cash buyer at auction.

You can have the valuation surveyor come out twice, but you will have to pay him twice. Have you discussed this situation in depth with the estate agent? If the vendor isn't willing to do any work, then what do they expect to happen?