Non-standard construction mortgage help

lkb1982

Hello. I have been a 'lurker' on this forum for some time now due to the wealth of knowledge provided by its users though non-standard construction mortgages does not seem to have been touched upon in much detail.

My dilemma is that I would like to purchase a property that is considered to be of non-standard construction; 70% of this property is timber framed, timber clad and coated with a layer of protective render that allows to timber to breath.

Having approached nearly all of the main stream lenders I am unable to find any willing to provide a mortgage on the said property. My LTV is 40% and there is no issue with credit/affordability.

Has anyone else had any experience in this area? Any help is much appreciated.

GMS

Properties like this are often subject to valuer's comments. I have a friend with a similar property and he mortgaged it.

Problem is if you find it difficult to buy at 40% LTV then if you try to sell it you will be eliminating many lenders and may require a buyer with cash or a very large deposit. Consider carefully if you are willing to take a chance on it.

May well be worth engaging a broker for this as they can get the case referred to see if it can be pre agreed to potentially save a wasted valuation fee

lkb1982

Many thanks for your reply. We have used a broker and we have had the property referred to a valuer from Halifax who said they would not mortgage the property. This has cost us a fair amount of money and time that has been wasted and we still do not have a value although we have paid for one.

The property is pre 1960 (1926) though I have commissioned a chartered structural engineers report and a timber and damp specialist report which were both in-depth and stated that the property is in very good condition and the timber has been preserved very well.

I have started approaching some building societies as I am aware that brokers are limited to those that can be approached. Are there any in particular that would consider such a property? I am aware that the property would have to be judged on its own merit and no firm answers would be given initially.

Many thanks.

Simon_gloster

You have done the right thing by going through a broker.

Each lender will have a construction policy. Unless its black and white the lender will offer subject the valuation. As you have found out, you have lost money to LBG coffers (and boy they need it).

Some lenders like flat roofs, some dont. Some like ex council houses, some dont. Each lender has a risk appetite for certain resellable properties.

jackomdj

The other thing you have to consider is lending criteria changes so when you come to sell it may not be mortgageable.

This is from experience. We bought a property which we just needed a normal survey, when we came to sell the mortgage companies were insisting that a mundic test (concrete cancer) was done on properties of a certain age in the region.... Well as our house had it we were unable to sell it to someone who needed a mortgage :-(

jason1231972

I attempted to buy a NSC timber framed, timber clad property (pretty much 100% timber, aside from the roof). The idea was abandoned, though not because of the property itself. It's on an ex-council estate where loads of people have bought their homes (presumably with mortgages!), and all the properties are made of timber. Just looking at the market on websites like righmove, properties on the estate also seem to sell quite healthily (though for relatively little money).

Mine was a little different in that it was a relatively new property (1970s). I researched who would/wouldn't lend, and got...

HSBC - usually OK for properties constructed post-1965, usually not OK for properties built between 1930(?) and 1965. Up to 90% LTV approved in principle with HSBC. I found their mortgage application line to be very helpful in answering this simple question of lending policy.

Santander - showed their mortgage adviser some pics of the property, they said usually fine, and that they already had existing mortgages on the same estate, both that they'd inherited from Abbey, A&L, etc., as well as new mortgages taken out during the past couple of years.

Halifax - I was under the impression that Halifax are open to the idea of NSC, but their mortgage adviser didn't have much clue about their policy on lending on NSC, so I never got to the bottom of this one. Rubbish adviser for many reasons, who I took a real disliking to.

Abbey National - obviously I didn't approach them (as it was 2012!), but they provided the original mortgage on the property (though a couple of decades ago).

Yorkshire BS - advised outright no on any timber of any age whatsoever

Skipton BS - didn't get back to me

Local broker #1 - advised it'd be a hard slog, but that he had a couple of timber properties himself (one being a log cabin in Scotland). He advised Halifax usually OK. He knew the type of property in question very well (he owns one that he lets out). We're in North East England, but he advised Scottish lenders are also usually quite open to the idea, there being more timber-framed properties up there.

Local broker #2 - a right slimy git, advised that 'nobody is lending on wood' (when this appears not to be the case). Horrid man who I known in passing outside of his profession. Has a poor reputation locally.

As I didn't actually buy the property, my research quest ended there. Of course, we could have got to the survey stage and got shot down in flames, but it all looked quite promising.

Conrad

Simon_gloster wrote: »

You have done the right thing by going through a broker.

Not really. No experienced smart broker would have put this property to Halifax - the OP has wasted thier money needlessly - OP might want to consider a complaint as it is clear Halifax would never lend on this.

Many brokers don't make it clear they don't deal with tiny Building Societies and other specialists. These types of 'tick box training course' brokers are pretty much clueless.

Ok, a small local regional lender is who I would suggest. Failing that, a specialist funder will likely do this, someone like C&D which only a broker can access. Any good broker will charge a fee as I'm guessing the loan size is small here. They might reduce the fee if they arrange a life policy (a good broker will re - emburse commision back to make the premium as competetive as possible).

Good luck

lkb1982

Many thanks for taking the time to reply. I have spoken with another broker who seems to have a bit more of an idea than the previous one.

As has been recommended in your posts he is suggesting some specialist lenders and will hopefully have some more information tomorrow.

Post 1960 timber framed homes are much more appealing to the lenders - anything prior to this are not considered by the majority of high street lenders.

ed110220

I have some experience of non-standard construction mortgages, but for a steel framed house rather than timber framed.

It is worth getting someone to speak to to the lender's valuer. In my case I sent a description/name of the house type through and the valuer immediately said they would be fine with it. On the other hand, the average mortgage adviser in your local branch probably will not know so much about the issue.

Another problem you may face is that a timber framed house of that age is probably a one-off or one of only a few, while most non-standard construction systems were built in large numbers and have a 'model name' as it were and will be familiar to anyone who deals with NSC. Therefore they may have to deal with it on its own merits rather than saying it's a type they do or don't deal with.

csh_2

I live in a timber property and have a mortgage with Birmingham midshires. My survey states that the property is suitable for mortgage purposes. It's a 1957 semi, the houses in this street tend to sell quite well and people seem to get mortgages on them from standard high street lenders. Some of my neighbours have mortgages with Lloyds tsb and Halifax. Getting home insurance is usually a pita...

Jimbo1976

It might be worth contacting a surveyor to ask for their advice. I notice the original OP went to a broker who tried Halifax, so its likely that this survey was done by Colleys (which is part of Lloyds Banking Group). On the Colleys website there are contact details for each surveyor by post code (you may have to go to the broker section to find this). Call the local surveyor to the area and ask them which lenders would be happy to lend on the property. Whilst Colleys is part of LBG group they will be on the panel for pretty much every lender and thus they will have details on what's an acceptable property type for every lender.