Unmortgageable flat over shop

yorkie1947

dunstonh wrote: »

non-standard buildings will see some lenders reject. A little bit of research or use of a broker would have avoided these declines.

However, the fact many lenders dont like flats above shops should put them on guard. In periods of market decline, properties that are harder to sell (such as those above shops - especially bookmarkers, off licence etc) will drop in value more.

Now, if they are happy with the inconvenience and are getting a decent price (i.e. quite well knocked down from the estate agent price and below comparable sized properties that are not above a shop) then they risks may be worth it. However, they need to see a broker or do better research rather than put in random mortgage applications.

As my reply to the previous post the applications have been made trough a broker. How can they do 'a little bit of research' ? do surveyors publish whether or not they advise lending on flats over shops ?

ACG

What is your broker doing to check whether they would lend prior to making an application? Using a broker does not mean its not being made on a whim.

There is no where near enough info to say if it is possible, however in theory it is possible but it may require a specialist lender, howver they will only be available upto certain LTV.

yorkie1947

Prothet_of_Doom wrote: »

And yet Shelter, the charity for homeless and housing problems, says that there are the EQUIVELENT of 250,000 homes above shops if they were converted, (added to the 500,000 homes that are empty, and have no council tax collected on them)

Individually we factor in risk when we make a major financial commitment, and the lenders obviously have history of previous problems.

As a society, we need to push the redevelopment of this wasted space.

I agree that the waste of these spaces should be addressed. In this case the flat is over a shop on the high street and there are many other flats for rent/sale over shops in the area.

kingstreet

It may actually be worth canvassing different survey firms, the ones who are used by the majority of lenders to see if any of them is likely to recommend such a property as suitable security;-

Countrywide
Esurv
Connells
Colleys
Andersons.

At least then you don't waste money on fees unnecessarily.

TBH I'd have phoned around before I submitted an application, myself.

PasturesNew

These are notoriously hard to mortgage. Most people buying them will be paying cash, or be landlords with previous lending history and a huge deposit.

Buying flats over any shops for regular people, needing a mortgage, isn't the norm.

yorkie1947

ACG wrote: »

What is your broker doing to check whether they would lend prior to making an application? Using a broker does not mean its not being made on a whim.

There is no where near enough info to say if it is possible, however in theory it is possible but it may require a specialist lender, howver they will only be available upto certain LTV.

ACG - As mentioned in my original post it is my daughter & son-in law who are having difficulties so I don't know all the facts. I do know that they are using a broker so I don't understand how you assert the applications are being made on a whim.

kingstreet

I would read on a whim as;-

"without properly establishing the lender and its likely surveyor will be happy to lend on such a property."

Some brokers simply throw mud at the wall in the hope that it sticks. They don't do the legwork before they submit the application. As a result, these speculative applications often fail, wasting time, money and unnecessary credit checks.

ACG

My original post did suggest an application was being made on a whim (i was wrong to say that is the case in this instance... although it does sometimes indicate that could be what is happening), my second post however says using a broker does not mean an application isnt being made on a whim... i backtracked a little.

Kingstreet makes a good post in that you/your daughter/your broker could check with the main surveying companies to check what their stance would be and this may vary depending on the lender they are working for.

What im basically saying is, rather than submitting applications the ground work/research needs to be done prior to submitting any more in order to give your daughter and son in law the best possible chance of getting this through.

yorkie1947

kingstreet wrote: »

I would read on a whim as;-

"without properly establishing the lender and its likely surveyor will be happy to lend on such a property."

Some brokers simply throw mud at the wall in the hope that it sticks. They don't do the legwork before they submit the application. As a result, these speculative applications often fail, wasting time, money and unnecessary credit checks.

Kingstreet - With hindsight I agree my daughter & son-in-law could have done more checking themselves but they took everyones advise and used an independant broker. Surely at that point all the checking was in his hands.

yorkie1947

ACG wrote: »

My original post did suggest an application was being made on a whim (i was wrong to say that is the case in this instance... although it does sometimes indicate that could be what is happening), my second post however says using a broker does not mean an application isnt being made on a whim... i backtracked a little.

Kingstreet makes a good post in that you/your daughter/your broker could check with the main surveying companies to check what their stance would be and this may vary depending on the lender they are working for.

What im basically saying is, rather than submitting applications the ground work/research needs to be done prior to submitting any more in order to give your daughter and son in law the best possible chance of getting this through.

I agree and that's why I made my original post for any constructive help.