refurb motgage?

mark3528

hi first post here, we have had an offer accepted on an edwardian semi that needs a lot of work, windows central heating kitchen and bathroom etc.

we had an offer in principle from egg mortgages, but they declined to lend after the valuer had visited, the purchase price is £99,000. we are looking to borrow £93,000. and do the work ourselves, this is a 3 bed house, a 2 bed about five doors up in good order has just sold for £125,000

please help

hollyblue

Firstly is there any negotiaiton on price with the vendor on the basis that it needs money spent on it. I'd certintly try that avenue.

What were egg prepared to lend on it? could you take out a loan for the difference between the mortgage and the purchase price until you have renovated and then remortgage to release the some of the equity and pay the loan off.

I'm not sure what figures you have to play with but its worth a few calculations surely?

JoeK_3

What was the reason for Egg turning it down?

Most properties with no suitable kitchen and bathroom are classed as not habitable, This property may have fallen into this category.

If so, you will need to make arrangements to deal with this problem before a further mortgage application can be submitted.

JoeK

toonfish

if it needs a total refurb you'll be lucky to do that for £25K

mark3528

JoeK wrote: »

What was the reason for Egg turning it down?

Most properties with no suitable kitchen and bathroom are classed as not habitable, This property may have fallen into this category.

If so, you will need to make arrangements to deal with this problem before a further mortgage application can be submitted.

JoeK

i would think this is the case, it was an old chap living in it, up until about 12 months ago when it was repossesed by the halifax, the kithchen consists of a sink set into a knackered freestanding unit, the bathroom is a severely stained bath and a bog without a seat, the walls are so yellow with nicotine that they are almost dayglow, it is a nice building though and nothing else available around here for this money.
is it all fubar or do you think we may be able to raise funds from somwhere if so where?

mark3528

toonfish wrote: »

if it needs a total refurb you'll be lucky to do that for £25K

we have priced at materials only, one of my brothers is a window maker and fitter the other a builder, i can plumb wire and plaster, the total would be at cost not plus labour margin, i need to know a broker or lender who might go for this, we could probably get another 10k deposit together within a couple of weeks, if the seller would let us have the keys for a fortnight we could have it in mortgageable condition for £1000

toonfish

it sounds to me like you could live in it, and so most of the lenders would consider it, although they may put a retention on. I'd start with the "best rates" but ensure that the property is discussed with the lender, and preferably their surveyor before committing any fees.

It's the valuer you need to convince really.

mark3528

toonfish wrote: »

it sounds to me like you could live in it, and so most of the lenders would consider it, although they may put a retention on. I'd start with the "best rates" but ensure that the property is discussed with the lender, and preferably their surveyor before committing any fees.

It's the valuer you need to convince really.

i could live in it, no bother, it has two open fires and i have tons of firewood, we went for an egg mortgage because they do free valuations, an offset savings account and overpayments were free over £500 every 6 months, i dont think we have time on our side to secure "best rates" we just need to finance it, get it bought and then maybe think about switching rates once it is in good order,
the girl we have been dealing with at egg readily admitted that egg are ultra conservative lenders and that we should really have gone to a broker, the problem we have is that the seller (halifax) wants to exchange by 15th may
is there any way around this? do you think it will throw a spanner in the works if it takes a week or so longer? i have not done this before,
any advice gratefully recieved

toonfish

you could easily get a mortgage offer in time to exchange 15th May. Use a broker though and save yourselves a lot more hassle. Make sure the solicitor is on the case - this is more likely to delay you than the mortgage

mark3528

spoken to a broker this afternoon, who said he would call me back and maybe it was the wife chinwagging but phone didnt ring, can you email me a contact number please?
thanks for the help thus far,
edited to add solicitors already paid in cash to accelerate searches etc.