Finding a lender for a property near a pub(!)

GMS

Attached to or near to commercial premises will restrict LTV for a start. Then the type of commercial comes in to play.

Pubs, take aways, late night convenience stores and the likes are frowned upon. Antique shops, post offices etc would be looked upon more favourably.

The property you have found is cheap for the reason(s) you are finding. The combination of problems is not something a lender would look to overcome at any LTV let alone 90%.

As mentioned earlier if you are having issues raising finance then you will have issues when you come to sell.

If something looks too good to be true it usually is.

_Andy_

If you're wanting a mortgage on a pub, look for one with no lock-ins (sorry, couldn't resist)

Goldiegirl

I used to work for the Halifax - freehold flats were always a big no-no. I seem to remember there were cases where the buyer owned the whole building, a lease for the flat could be created, making the mortgaged property a leasehold flat. If you wanted to continue with another lender, this could be an avenue to explore.

With regard to the valuation fee, I'd question whether this would be refunded. The valuation has been done, so the fee has been spent. The valuer has to be paid, whether the mortgage proceeds or not. I'm guessing that the Halifax did not know that the property was a freehold flat until the valuer told them. When the application is keyed on to their systems, if the property was keyed as a freehold flat, the system wouldn't even let them instruct the valuer, it would be an automatic decline.

Even if the freehold/leasehold issue were resolved, there's the point about being near a pub. Flats near pubs/takeaways etc were never very popular, due to potential resale problems. There's potential for smells from cooking, noise and nuisance, all things to put buyers off

Leon_W

I'm with Goldiegirl on this. I really don't think you'll get a refund of the val fee. Why would you think you would ?

It's an interesting one though and I suppose everybody will have a different view. I can see where the freehold flat angle is coming in but is that any different to what some of the newbuilders around here are calling "coach houses", basically a flat above garages ?

The real killer will be that pub. With a lower LTV it might have been simpler but at 90% it's a bit of a risk too far lenders.

Wh05apk

This sounds more like a "coach house style property" who owns the parking/garage below? is that yours?

I think Coventry may consider this, but subject to vluers comments about the pub.

Dave_Ham

The Mortgage Adviser at the Halifax should have checked. Say it was a leasehold and only had 55 years remaining, do you think the valuation would be refunded for this?

I worked at the bank in question in various roles and would have refunded for sure. The property did not fit criteria and the MA should have identified this.

I agree, open to debate but confident you will get the valuation refunded..

All the best

kevelesopnic

I have never understood the issue regarding commercial use of attached properties, i.e property next door or above a commercial property.

Given the fact a mortgage is often over (say) 25 years, the use could change numerous times over that period. Today's pub (bad) could be tomorrows coffee shop (good?) or vice versa. With the rate pubs are closing at, it is even more likely that the property will no longer be a pub in (for example), 10 years time

Goldiegirl

If the MA is at fault, then yes, the valuation fee should be refunded.

But, at the mortgage interview, even if the right questions are asked, the applicant can give the wrong answer.

Often, problems with the lease are identified by the valuer, or by the solicitor. With the best will in the world, the MA, isn't at fault if they have been given the wrong information by the applicant.

I'm not saying this has happened in this case, but it did happen quite often.

Dave_Ham

Agreed, goes without saying; if the OP has lied then no refund. If the MA has not asked the right questions or not listened to the answer then a refund should be provided