Unmortgageable 1 bed flat less than 30 sq m

milletme

Sorry not been back on here for a while. Update on the flat, we rented it out and are now in the process of selling it.
Had 2 unsuccessful attempts to remortgage. Those mortgage companies really p****d me off. Each one we asked on several occasions if they lent money on flats less than 30sq m. Both mortgage companies said yes that was not a problem. Both took setting up fees, both took surveyors fees. Both then came back to say no, we do not lend on property less than 30sqm. Didn't get anything back from 1st company but 2nd has rather begrudgingly given a refund as we got it in writing from them before we started filling out forms that they lent on property under 30sqm.

Landyandy you live in Hampshire, this flat is in central London. Completely different housing market and housing stock.


What mortgage companies have effectively done with this ruling is to take away the 1st rung of the ladder for 1st time buyers in London who in order to afford a place will then go and buy property in different parts of the country to rent out for a time then sell in a couple of years to make the deposit needed for a 30sqm home in a city where they work.
Already know some friends children who cannot afford the deposit for a mortgageable flat are doing this.

martindow

You mention a 40 foot garden. Is there any possibility of extending? In London it could make a big difference to its value.

silvercar

What mortgage companies have effectively done with this ruling is to take away the 1st rung of the ladder for 1st time buyers in London who in order to afford a place will then go and buy property in different parts of the country to rent out for a time then sell in a couple of years to make the deposit needed for a 30sqm home in a city where they work.
Already know some friends children who cannot afford the deposit for a mortgageable flat are doing this.

These mythical FTBs are going to find it hard to get a BTL mortgage without owning their own home and having to show they can pay their rent and cover the costs of the BTL. They are also going to need sizeable deposits if they are buying a place to let out!

milletme

Silvercar they are getting an ordinary mortgage on a cheaper property in the north then are going to ask the mortgage company permission to rent it out for a time because of change in circumstances. We have an ordinary mortgage on our own home and will be asking to rent it out sometime next year because our change in circumstances. Picked carefully there are much cheaper properties that more than get the rental income to pay the mortgage.

Martindow the property does have planning permission to extend and that is what we will probably do in the future. As I said our circumstances changed and really did not want to do an extension. We really wanted to sell.

silvercar

Silvercar they are getting an ordinary mortgage on a cheaper property in the north then are going to ask the mortgage company permission to rent it out for a time because of change in circumstances. We have an ordinary mortgage on our own home and will be asking to rent it out sometime next year because our change in circumstances. Picked carefully there are much cheaper properties that more than get the rental income to pay the mortgage.

Chances of getting consent to let without having lived in the property first are limited and would generally seen for what they are - an attempt to get a property to let on a residential mortgage because the rates are cheaper and they have only a small deposit. The fact that their jobs are in the south would be a bit of a give away. lenders aren't stupid.

Your situation, where you ask to let a property that you have lived in for a reasonable length of time is a world apart.