remortgage retention

jenlo

I have obtained a remortgage and the valuation report has come back stating " the property has suffered from differential movement with dropping down to the right hand side of the gable wall. There is some cracking in the party wall and to the front of the property which may well be longstanding, however I feel it prudent to obtain a Structural Engineers report to clarify that.' It also states 'The property has suffered from structural movement although it has been internally refurbished to a good standard but the cracking externally could indicate some ongoing movement that would need to be checked.'
He has put a £8000 retention on the property as well as downvaluing it by £20k - ££12k once retention is lifted. When I bought the property in 2006 the survey brought up evidence of movement but not ongoing, this was stated again when I remortgaged it 2 yrs ago.
Does this mean they will offer me a mortgage but only after a satisfactory report is obtained and any work carried out if necessary.
The prop is a semi built circa 1890 and has previously had satisfactory mining searches.
It's a remortgage and I have asked for an extra £10k for home improvements, if the report stated £x work needs doing to prop would they lend me the amount less retention then pay me the £8k once work done, or would I have to get the work done before they lend any money, hope this makes sense, and thanks

hcb42

I am struggling to understand that from your post. You dont say how much you are looking to borrow.

However, if you are borrowing against a property which seems to be declining, I would urge caution....

a retention generally means they will lend it once the work is done

holly_hobby

Gosh .. funny old world there was a similar post I answered earlier this pm regarding structural movement - must be all the rage !!

From what you have described the property may need underpinning/foundations re-packing & wall ties, you have mentioned a prev mining report was ok, which must be correct as you would have had a prob when you first mortgaged if this wasn't the case.

With regards to the retention - the lenders surveryor has advised that the property has been downvalued by a minimum of 12k (i.e after completion of works), they lender has said that they will allow you to complete, but are only prepared to lend you what you have requested less the 8k retention - until the works has been completed (by a suitably qualified professional with certs of gte and details of work carried out).

If at that point, you still want the extra 8k, a re-inspection is completed by the surveryor (with a re-inspection fee) and if he is happy with the work, and that in his opinion the property is sound, then the lender will release the retention, either in part or all - its up to you how much of the 8k retention you then wish to drawdown.

Or you can choose not to complete until all works have been done with a re-inspection completed - and just get the whole loan as initially requested.

If the lender/surveyor are insisting upon withholding the full mge amount until the works are completed, they would state a "full retention" .

As this is a remortgage - I presume you already have buildings & contents - you may find that subsidence is covered under the buildings element of your policy - thereby you will be able to lodge a claim for the works under your b&c policy. ( you may already know this - so just playing devils advocate here !)

Hope this helps

Holly

jenlo

Sorry its a remortgage cos my deal is up, the property is in good condition I have had a couple of surveys in past for remort purposes and no retentions. I want to borrow £110k prop has been valued at £150. I was suprised when it came back with a retention due to past surveys showing history of movement but historic and no signs of it ongoing, and that was only 2 years ago! My concern is if the structural report comes back saying £x of work needed, would the lender just hold the £8k retention until work done or would I have to have the work done until and wait for all the money to be released until it's done.

jenlo

Holly, I do have building insurance but never thought about being able to claim for any structural work! Hopefully it won't come to that, fingers crossed!
The cracks the surveyor is on about have been there since I first bought it, unless he saw something he didnt tell me about. Just seems strange that I have had 3 or 4 surveys done on it in past and never had this before, although after mentioning it to an estate agent friend she has heard of this surveyor and said he is very very cautious and is renound for purchasers to obtain reports!

holly_hobby

Surveyors who miss things, that turn nasty, get sued ... simple as !!

He is just protecting himself, and to be honest its not a bad thing from your point of view too - as I would certainly want to know if my property was experiencing movement - hopefully there is nothing to report, and a new offer will be issued with your retention removed.

Good luck with fingers crossed !!

Holly

jenlo

Thanks Holly will keep you posted, not had any offer yet this was just from the valuation report.

holly_hobby

Ok, wait and see what the lender comes back to you with & take it from there.

If you want any more guidance, just give me a nudge - always happy to help where I can !!

Holly