Residential Mortgage sold on a commercial property

holly_hobby

Amosgreenfield wrote: »

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.

This explains everything .... its not a residential pch or sale at all.

The rooms with en-suites aren't the issue for the new mge lender, the 3 separate kitchens, and its commerical use registration are !!

You are effectively selling a B&B (with p permission to convert to 4 flats) - commercial finance reqd for this.

Or resi, you'll have to remove/decommission the small upstairs and 1 lower kitchen (as only 1 kitchen per residential dwelling), and change the useage to resi ...

Are you sure you have a residential mge ?

If so there have been some right royal c**k ups with this ... least of all the lender has actually lost out financially, as commercial rates are SVR & 1.5/2% loading on this type of borrowing, which I am guessing is somewhat lesser than what you're being charged ... !!!

The surveyor and solicitor would be brought to task by the lender (whom are using the property as security and (it appears may have wrongly) issued the finance as a result of the guidance from the 2 indviduals).

What a wasps nest !!

H x

Amosgreenfield

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

Yes. What can I do I can't sell this dam place!

ILW

Amosgreenfield wrote: »

Yes. What can I do I can't sell this dam place!

Go to auction, it sounds like one for a developer.

michaels

Hmm - should OP have been living there as a residential property at all, for example if it was a commerical (shop) premisis then I guess it would be illeagal to use it a personal residence.

Could you not get change of use to residential without the seperate planning issue? Our house has a seperate kitchenette in the 'granny annex' which does not make it non-residential, surely only the council designation is the issue?

holly_hobby

Why have you never applied off Change of Use (COU)?

Why can't you just fund and apply for COU now ?

But, as stated, the mulitple kitchen areas WILL on survey inspection cause any residential purchaser requiring a residential mge - a problem survey wise. Of course wait and see, but be prepared for the purchaser to ask if you will remove the facilities pre completion.

If you don't have the finance to fund any cost of reqd changes to permit a resi sale, then auction is the way to go I feel.

Holly

holly_hobby

michaels wrote: »

Hmm - should OP have been living there as a residential property at all, for example if it was a commerical (shop) premisis then I guess it would be illeagal to use it a personal residence.

Could you not get change of use to residential without the seperate planning issue? Our house has a seperate kitchenette in the 'granny annex' which does not make it non-residential, surely only the council designation is the issue?

Its a B&B, with private accomodation, so even when in use, it would be as semi-commerical, so no laws have been broken. Importantly, the OP didn't pch as a commerical unit, nor sought commercial finance, nor operated any commercial venture from here - so she's nothing to worry about on that front. The issues have come from the mge and conveyencing side of things.

But yes, if this were an office/commercial space, that were made into a residential dwelling without planning permission and COU, then the fallout would be to rip out all residential fixtures and return it back to a dedicated commercial unit.

Or if she bought as a residential dwelling with resi finance, then set up a B&B, with no change of use, commercial loan, no payment of business rates, etc, etc ... there'd be skin and hair flying from all corners !

Hope this helps

Holly

Leon_W

Something doesn't add up. If the council still has it down as a B&B you must be paying business rates. Why didn't you tell them when you bought the property that it wasn't being used as a business and pay, presumably, lower council tax instead ?