Problem getting Mortgage because of house 'build'

Yomo

Hi all,

My girlfriend and I are 28 and have been having a hell of a time getting a mortgage. Our first offer got accepted, but fell through when we discovered that the vendor and estate agents were trying to hide a subsidence issue.

So the situation now is this:

My mother is mortgage free and is looking to sell her house to us. The house has been valued at £225,000 but she is dropping the price to £200,000 to make life easier for us. We have a £32,250 deposit sitting in the bank being added to each month.

Between the two of us, my girlfriend and I earn close to £70k/year plus bonuses and have no marks on our credit rating.

... yet our financial advisor cannot seem to get a lender to bite.

The lastest development apparantly seems to be because my mothers house is a) situated in a conservation area and b) is made of insulated concrete blocks but is otherwise built to standard regulations.

Is it normal for lenders to be picky about the the materials that a house is built of (unless it's mud!) and where it is located? I also thought being a conservation area would be beneficial...

I realise times are difficult and lenders are being cautious, but this seems to be a little overkill.

Thanks in advance,
James.

kingstreet

The conservation area shouldn't be a problem, the construction method may be.

You need to know what is the exact construction and if it has a name. Is the type mentioned as defective under the 1985 Housing Act?

http://www.legislation.gov.uk/ukpga/1985/68/part/XVI

Is it an ex-council house? If it is, have a look at the local council's site for details of defective property under the 1985 HA.

This will determine if it's mortgageable.

kingstreet

This GE Money guide may be of more help as it lists the types;-

https://www.gemhl.co.uk/eupg/pdf/first-national_underwriting-criteria_fn-property.pdf

Yomo

Thanks, I'll check those two links out. I certainly didn't realise there was such a thing as a 'defective build type'.

My mum's other half is a construction project manager and as far as he's concerned, it's of normal build standard. Granted, he could be wrong so I'll do some digging.

Our financial advisors have actually contacted the council this week and are expecting a call shortly.

I just found it rather odd since the house is situated amongst an area that is full of this type of building (made up of 3-4 streets); others have sold recently and there are one or two are up for sale now.

Thanks.

Yomo

The GE PDF includes the paragaph:

Cavity Masonry: This refers to brickwork, block-work or stone that built in two vertical leaves (or layers), with a space between them. This is a traditional method of construction.

I would certainly say that the block-work of the house comes under this definition.

kingstreet

The issue isn't how it's built, it's what it's made of. Standard construction would typically be brick walls under a slate or tile roof.

Anything made out of concrete is not standard construction by the lender's/surveyor's definition, hence the rather long lists of different types of concrete construction. Putting two levels of it side by side and calling it "cavity" won't help.

Yomo

Thanks for the tips folks.

I've done some digging around and contacted the original architects/construction company. They have forwarded me some information about the development that contains the following line:

"The construction used cavity walls of Lignacite blockwork throughout, fairfaced and unpainted externally..."

So a quick Google takes me to the Lignacite webiste that states:

"Lignacite blocks are BSI Kitemarked certified to BS EN 771-3. They are Category 1 masonary units manufactured under BSI approved certified Quality System complying with BS EN 9001"

Does anyone know if this sheds any light on the situation?

Conrad

Certain lenders can consider such a construction material. The broker needs to forward the building type to the surveyors that act for lenders.
I know of several lenders but to be frank you've stuck by this broker so get him doing the leg work! Sounds to me like he doesn't have a lot of experience maybe?

kingstreet

Phone your adviser and give him the details.

Ask him to phone Colleys, the Halifax internal survey firm and ask to speak to one of the surveyors. He'll be able to confirm the Halifax approach to it and how it might be perceived by other lenders.

Colleys surveyors are encouraged to speak to brokers, according to our BDM in this area.

Thrugelmir

Suggest you speak to a (RICS) property surveyor. As to what the issues with the construction of the house are and what can be done to rectify the situation.

Yomo

To be honest, we were referred to him as he is a friend of my partner's dad. As far as I know, he's been in the business for at least 15 years.

He's charging barely anything for his services, so it made/makes sense for us to stick with him.

I've spoken to several neighbours and they have no clue why the houses would be difficult to mortgage. There's also a house that's been sold at this very moment in the opposite street with the same construction.

Northern Rock have written us off because a) they can't guarantee the construction type and b) is a conservation area.

I'm wondering whether we should re-apply somewhere else and just state that it's a standard build house and see what the survey says.