Residential mortgage on Investment property

ACG

Hi,

Ive found a property which is up for around £100k, its an old commercial building. It has planning permission however to be converted into a residential property.

I have 2 mortgages in place for another property that fell through 2 weeks ago. 1 is with the Halifax, the other is with RBS. Do you know if either of those would allow the mortgage to go through if im buying somewhere to convert into a residential property to move into it?

dimbo61

Ring them and ask !

ACG

It was nearly 8pm. I was trying to get an idea so that i can start to prepare things.

Such a stupid response! That would be the first thing i would do if they were open.

I reply to a few posts on here mainly in the insurance section, i could write that on pretty much every post but i dont i make posts which will help the thread starter or i dont say anything at all.

TMSL

If the property stands currently in a commercial form neither RBS or Halifax will lend on a residential basis.

dimbo61

A branch of yorkshire building society USED to be one of the big lenders for self build properties !
Or you need the help of a mortgage broker
check out the self build mags for mortgage lenders GOOD LUCK

Thrugelmir

dimbo61 wrote: »

A branch of yorkshire building society USED to be one of the big lenders for self build properties !
Or you need the help of a mortgage broker
check out the self build mags for mortgage lenders GOOD LUCK

This isn't a self build as such.

Any lender will require a lot more detail, such as cost of conversion etc.

Conrad

If you want to raise funds on the target, they will be at commercial rates and specifically 'development' finance which is expensive. Your cheapest bet will be a high street Bank such as RBS, but raising such finance is pretty trickey from such organisations and the red tape will be immense.

My developers tend to use specialist small development lenders with rates in the region of 18%, but the funds are usualy granted fast and with far less red tape. They then get the project well advanced and then refinance with a high street lender.

Try and have the water board, electricity and gas people all dig thier hole on the same day otherwise you can face months of frustrating delay.

ACG

Thanks for the responses.

Ive found that RBS do commercial mortgages. I could probably afford to put down a 40-50% deposit so hopefully that should be enough.
I couldnt afford an 18% mortgage so if that was my only option then i would have to give this opportunity a miss. Ive still to view the inside of the property yet, so if its one of those things where it isnt structually sound then i dont think i would have the balls to give it a go but if its more like putting up a wall here and there internally to split it up and some plastering etc i would give that a go.

Nothing ventured nothing gained as the old saying goes.

Cheers for the responses guys.

RecoveringAlcoholic

Ive found that RBS do commercial mortgages

If you wear a kilt and drink whisky, RBS will not bother to ask for a business plan and cashflow forecasts.


.

Conrad

I use RBS for commercial cases, but given they were on the brink of going pop and now have billions in bad debts to deal with, they are tricky to use to say the least.
Its all about cashflow. They are'nt lending based on having a large equity cushion.

JQ.

I agree with Conrad - as far as RBS are concerned it's all about income servicing the debt. I really can't imagine RBS lending to a first time commercial developer in the current financial climate. Some of my clients are struggling and they've been 10 years with RBS doing development. They banks are not interested in development finance - it's too risky.