Definition of a "new-build" for LTV purposes

homebuyer99

Would a 1930's house be classed as a new-build?

Some mortgage companies say a new build could be classed as "any house sold by a builder or developer" or any house that has "undergone extensive refurbishment"

I am looking to by a house from a builder (1930's semi) that has a new kitchen, rewire etc

Is this a new build?

Thanks

kingstreet

In my opinion it isn't a newbuild. It certainly won't be valued as a newbuild by a surveyor, and that's what counts. If the builder/developer thing was true, part exchanges would be classed as newbuilds and they aren't!

homebuyer99

On the contract though it says

vendor "such and such property developments acme town"

kingstreet

My last but two property was a part-ex. I bought it from Persimmon Homes. No question of it being a newbuild.

My last home before this was a 1930s semi renovated by a builder. Again no question of it being a newbuild.

Can you tell us the names of the lenders concerned?

homebuyer99

Hi Kingstreet,

Thanks for helping me (thats twice now)

Its abbey

kingstreet

Abbey criteria on newbuilds;-

This relates to all new build/converted properties including affordable housing such as shared ownership. We define new build as:

Property built/converted within the last 12 months (i.e. based on the date of the completion certificate).

Property has not been previously occupied (for converted properties - that is since the conversion has been undertaken)

Property is being sold/marketed by a builder or developer

Where the property is within a development that was once used for commercial or other use, i.e. not previously used for residential purposes.

Builders may offer sales incentives to prospective buyers to encourage them to purchase their properties. An incentive is anything the builder gives or provides to the buyer in cash or goods.

We will accept up to 5% cash back towards the purchase price (no financial limit) and builder’s payment of legal fees and stamp duty only. Any reasonable non-cash incentives, eg white goods, carpets, curtains etc. will be ignored.

Standard new build LTV limits (all borrowers including First Time Buyers)
House 80%
Flat 70%

Higher new build LTV limits (First Time Buyers only up to 4 x income)

House 90%
Flat 80%
Please see our "First Time Buyer" section for a definition of a First Time Buyer.

Please be aware that all applications will be subject to additional policy including maximum income multiples.

For Section 106 Agreements, it is no longer necessary to send these and associated documents to us for approval. We will rely on our existing solicitor instructions, which require them to approve the documentation.

I see what you mean about the "being sold by a builder or developer", but I don't think you should necessarily assume only one of the definitions has to apply. IMHO Abbey would not term it a newbuild just because it was sold by a builder, but would apply one of the other tests as well. The property I bought from Persimmon was completed with an Abbey mortgage and the issue never came up.

Can you expand on the issue. Is there a problem with your purchase, or a property you are selling?

homebuyer99

No problems so far (fingers crossed) I am just very paranoid as I am in love with the house.

Nothing to sell, vacant possession (been like that for around three months)

Going through with the underwriters atm and they have asked for just one wageslip. Is this normal?

Single income multiple is fairly high although with no debts and an LTV of 85% and an unblemished credit record (plenty of mortgages and credit cards all paid or settled on time)

kingstreet

I don't expect you'll have a problem. Answer their requests for information or documentation in a timely manner and your application will work through to offer fairly quickly.

homebuyer99

,why only one wage slip though? Don't they normally ask for loads more?

kingstreet

homebuyer99 wrote: »

,why only one wage slip though? Don't they normally ask for loads more?

Sometimes it's none. Sometimes it's one, other times it's three. Sometimes they want a P60. A lot depends on your credit score.

homebuyer99

The part about the house being lived in its current state? It hasnt been since its been decorated.