Can you get a mortgage to buy an adjacent property?

embraman

We live in the upper part of a Victorian house that was converted into two flats back in the 1960s. Our mortgage will be finished in February and is currently tiny. Our downstairs neighbours are moving and we are looking at buying downstairs and moving in my aged Ps, as tenants on a nominal rent.

We saw the Nationwide today, only to be told that while they would be delighted to give us a sizeable mortgage to buy somewhere on the other side of town, they will not "as a matter of policy" give us a mortgage to buy downstairs. While grateful for the opportunity to buy property elsewhere, the point of moving the old folks in downstairs is that they would be, er, downstairs.

Can anyone tell me whether this is a Nationwide-specific thing or is obtaining a mortgage to buy the downstairs flat likely to be a major problem (as a matter of principle, leaving aside affordability etc.)

ACG

why not remortgage your property to buy a second property?

you then dont need to disclose the property you are buying?

Dave_the_Ginger_Cat

There may be a few who will say this:

To a lender, there may be a risk that you will convert them back to one property, which can mean the overall value will be less. I'd capital raise on your current one, as ACG suggests

Prothet_of_Doom

Dave_the_Ginger_Cat wrote: »

There may be a few who will say this:

To a lender, there may be a risk that you will convert them back to one property, which can mean the overall value will be less. I'd capital raise on your current one, as ACG suggests

That's interesting.

I have had a plan, which can only be enacted, when the old dear either decides to move into nursing care and sells her house, or pops her clogs.

That is to buy that house, as we share a driveway, convert the deeds, so that my house has all the driveway (which I shall put a garage on), and some of her back garden.

At that point I will decide whether to rent her old house out, (there is no different in rental value with or without a shared drive), or flog it, at a slight loss, but having added value to my own property.

So must the plan be to remortgage our house, in order to pay cash for the second ?

holly_hobby

Is your current lender Nationwide ?

If so, their approach will be in relation to exposure levels, ie 2 units in the same block with the same mortgagor.

Standing on its own, a mge on the flat dstairs, would technically be a dependants mortgage, or a regulated Buy To Let arrangement (both assessd on your own income).

The advice to remortgage your own to pch a 2nd property, which is permitted with several lenders, and pch downstairs for cash, is by far the less troublesome.

Assuming of course there is sufficient equity in the property, with the app coming in below max ltv's and with your income being sufficient to support .....

There will be a solution for this, the issue is which unit the borrowings will be raised on .... a broker will be your best bet, as they will sound this off their likely lenders before submission of any app, saving you the legwork and headache ! (check you're happy with their fee structure before engaging).

Hope this helps

Holly x

holly_hobby

Prothet_of_Doom wrote: »

That's interesting.

I have had a plan, which can only be enacted, when the old dear either decides to move into nursing care and sells her house, or pops her clogs.

That is to buy that house, as we share a driveway, convert the deeds, so that my house has all the driveway (which I shall put a garage on), and some of her back garden.

At that point I will decide whether to rent her old house out, (there is no different in rental value with or without a shared drive), or flog it, at a slight loss, but having added value to my own property.

So must the plan be to remortgage our house, in order to pay cash for the second ?

Firstly check on the planning permission re the drive adoption.

You'll have to pch for cash first, if you intend on reducing the boundaries of next door, as a reduction in land and loss of driveway will affect the lenders security and value on sale - so you would need the lenders permission to so, which is unlikely to be given if there isn't a huge amount garden etc to start with.

So pch for cash, change the boundries, have the deeds amended with LR, and then seek a remortgage on next door - which I assume you will let, and will be a BTL remortgage.

Hope this helps

Holly

embraman

Thanks for those replies. I'll contact a broker, as suggested.