Mortgage on a property with an annex

elsieelsie_2

does anyone have experience of having a mortgage on a property with an annex attached. (the annex is attached but has separate entry). The property does not currently have planning permission to let the property as a holiday let ( I am aware this is something that is required). We are interested in buying the property but the advice I have been given is that mortgage lenders will not lend to properties where there is an annex to let out (reason: if we were to forfeit payments and they had to repossess the property they would also have the problem of evicting tenants). Any advice gratefully received.

holly_hobby

Do you intend to let the annex, is it fully self contained. Or will it be solely used as part of your primary family residence ?

Q to ask the Vendor, does the annex have planning permission and appropriate sign off ? (or an indemnity policy in place).

H

elsieelsie_2

Thanks.
Its self contained (own entrance) plus there is a internal door that connected the two. Intended to let out as a holiday let.

holly_hobby

Then as a combined unit, you'll need to look at a traditional (semi)commercial mge, following which then you could look to split the deeds (block up the connecting access) and simultanerously move your primary residence onto a resi mge, and the holiday let onto a suitable arrangement, of which there are resi lenders who do offer holiday let products (albeit it will still be at semi-comm rates i.e svr & loading of circa 1.5% give or take ... !)

You will initially need the assistance of a commercial broker to source the most suitable product and lender for your requirements (you could primarily approach your own bankers to sound this out, which would also save you an initial consultation fee that a broker may levy. You may then of course approach your broker to beat the deal offered, or to find you a lender if your own bankers have declined).

If they annex is to remain on the same title deed as the main resi, and if this were to be occupied by a family member (whom is not party to the mge), I would generally expect the lender to accept a "consent to vacate" disclaimer (which are applied in any event to resi mges, where there are individuals not pty to the mge and over the age of 17, whom will reside in the dwelling with the mortgagors) - which seeks to deal and eradicate residency issues in the event of a possession order on the property.

Hope this helps

Holly