Residential Mortgage sold on a commercial property

Amosgreenfield

In 2006 my wife and I bought a property in Wales on a residential mortgage. We new it used to be a B&B however hadn't been used as one since 2000, we decided to put it on the market in 2008 we had several offers but the people interested came back with the same problem. They couldn't get a mortgage because it was a commercial property. I am worried that if I go digging our mortgage company will expect us pay more because its a commercial property although its not used as one and will need a fair bit doing to it to make it back. Any ideas???

kingstreet

Go digging for what?

There is little I can see you would need from your existing lender. If you are selling the property, it is only your purchaser which has the mortgage issues.

Can you be more specific in the help you are seeking?

Amosgreenfield

I am paying a residential mortgage on a commercial property. I can't sell the house to anyone who wants it for a home because they can't get a residential mortgage like I did.
What are my options. Do I go to the mortgage company and complain that I was sold a residential mortgage when in fact I should have been refused it. Or will they decide I now need to have a commercial mortgage?

kingstreet

How did you purchase the mortgage?

Did you get "advice and recommendation", from an authorised person, such as a broker, who provided you with a suitability report or did you go directly to the lender and got "information only?"

ILW

Are you paying business or domestic rates on the property?

Amosgreenfield

I went through a mortgage advisor and I'm not paying commercial rates or council tax. Everything is as its a residential property. Apart from the fact that it is registered as a B&B. I don't know how we managed to get a residential mortgage in the first place.

holly_hobby

Even if your mge was changed to a comerical one, that doesn't solve your purchasers mge issues ... but will cost you a lot more !

You've had surveyors round for your potential purchasers ? Why did they assess it was still a (semi) commerical unit (if its being sold and purchased as a residential dwelling) ?

Ex B&B - are we just talking that every room has its own en-suite ? Or is the building obv commercial when you enter, ie reception area still in situ, 2 kitchens or obvious commerical kitchen set up, do the rooms themselves have kitchen areas (as I have been seen with some hotel rooms), etc, etc ....

Secondly what is your property registered as with the local authority - a business or residential dwelling ?.... As that'll be the crux of argument, whether a commerical mge is really needed (notwithstanding if any of the above issues are applicable to your situ).

If still registered as a commerical residence - then apply to your local authority, for change of use - to residential (which if this was a private residence in its previous life, should have not too many issues in being granted).

If there are still "commercial" aspects within the property, which are removeable, then do so - you want the surveyor when he arrives to have no doubt that this is 1 residential dwelling.

Althought the fact you actually obtained a resi mge in the first place, lends me to think that none of the above apply ... unless the surveyor made a massive foul up or didn't physically attend the property (unusual on a pch though) .... so this is very intriguing !!

Anyhoo, bit more meat on the bones if you can ?

Hope this helps

Holly x

Leon_W

So, if i've got this right. You bought a residential property in 2006 with a residential mortgage which has been used as a residence since ? I really can't see the problem.

The fact it had been used as a B&B in the past shouldn't make any difference unless there are lots and lots of bedrooms to any lender.

Look at it this way. Why would you have needed a commercial mortgage if the property wasn't being used commercially ?

Amosgreenfield

Two kitchens on on the lower floor and a small one on the third floor. The house is over 100 years old. Most rooms have a sink and each room has a key. 10 rooms in all with three bathrooms. It's registered with the council as a B&B. I've applied for permission to change it to 4 flats all the plans went in via a potential buyer but the mortgage company refused to agree because I don't have a commercial mortgage. I can't afford to do it myself and I can't afford to pay for a change of use. The surveyor when we bought it did a drive by survey, the potential buyers didn't even get that far because I'm assuming there mortgage advisor or whoever gets to the search regarding what type of property it is.

holly_hobby

Leon_W wrote: »

So, if i've got this right. You bought a residential property in 2006 with a residential mortgage which has been used as a residence since ? I really can't see the problem.

The fact it had been used as a B&B in the past shouldn't make any difference unless there are lots and lots of bedrooms to any lender.

Look at it this way. Why would you have needed a commercial mortgage if the property wasn't being used commercially ?

Im guessing change of use wasn't sought (and its still registered as a commerical resi, albeit not used as 1), compounded by the Sol failing to check this had been obtained, as part of the original conveyencing process.

H

ILW

holly_hobby wrote: »

Im guessing change of use wasn't sought (and its still registered as a commerical resi, albeit not used as 1), compounded by the Sol failing to check this had been obtained, as part of the original conveyencing process.

H

I would suggest the solicitor has some explaining to do. That is unless OP knew waht was going on.