Halifax Mortgage problems due to house divided into flats

milly_molly_mandy

Can anyone give me any guidance or has anyone had any experience of purchasing a house that was sub divided into 2 flats.




Our mortgage advisor is not returning my calls or emails and Halifax will only speak to the mortgage advisor.


I will try not to bore you too much but this is the scenario....


We got a full asking price offer on our house (already have a mortgage with Halifax). We found a lovely house in a nice road that had been sub divided with mum living downstairs and son and wife living upstairs. It had not been properly converted and the only things that have been done are...kitchen upstairs, bathroom downstairs, locked door to stairs, 2 boilers, 2 electric meters. There is no building regs or pp and there is only one council tax paid for the house. The house needs some tlc but has amazing potential.
We put in an asking price offer and got it.


So simple we thought....the surveyor is booked in but then the nightmare begins!
The surveyor goes and takes a look but sees the locked door and says Halifax will not lend on this and nor will any other conventional lender. It takes 10 days before we found out that the surveyor had valued it at £0 (even though she returned her report on the same day!).
Our mortgage advisor says we can appeal. This was on the 25th October. We are being told that we will get a mortgage but it is with the underwriters and they will probably want the kitchen removed, door to stairs removed and maybe some other things. Our mortgage advisor keeps saying they will make a decision in 48 hours but then a week goes by and we don't hear anything. This has been going on now for nearly 6 weeks and we are no nearer as far as we are concerned. The last email we received was from our financial advisor on Tuesday to say he will chase it again on Weds but he hasn't returned any of our calls or emails so of course it is really winding us up.
The buyers of our house want to exchange, the people we are buying from our going crazy and we are having a nervous breakdown! We even got permission to remove the upstairs kitchen and door to stairs from the sellers which we did ourselves last weekend.


We are experienced buyers/sellers (we move every 2-3 years) we have been with the Halifax for banking (15 yrs) mortgage (7yrs). We have never missed a payment, never missed a credit card payment and have no current loans/cc and are borrowing less than half of the purchase price.


We are so frustrated with all this, firstly because we haven't a clue what is going on, and secondly wonder why it is taking so long. I am quite ready to go to another mortgage broker to try again with another lender but will they know that there is a problem with this property.


I am hoping that someone will be able to calm or reassure me that we are not wasting our time.


Thanks so much

kingstreet

Find the Colleys surveyor for your area who did the valuation and find out what they want to put a value on the property.

http://www.colleys.co.uk/customer/contact-us/find-your-local-surveyor/

As this is nothing to do with you the borrower and totally about the property, your payment history, loyalty etc means nothing. You need to establish what needs doing and who is asking for it to be done, lender, or surveyor.

You appear to have a passive advisor who is doing nothing to actively resolve this, so you are going to have to take control and find out what is going on.

TBH a property with two kitchens was always going to be an issue on the high street and your advisor has done you a disservice if this was not explained to you at the outset.

milly_molly_mandy

Thanks.....while I was reading your reply we have just had a reply back from our financial advisor. He said Halifax have refused the mortgage as it does not meet their 'Mortgage profile'. He says he can try and appeal again but I really do not want to waste any more of my time on a very slow financial advisor and Halifax.
I am just wondering if we have had a mortgage refused already on a property (even though we have removed a kitchen and door) is this propert still unmortgageable. We will start again with another IFA.


thanks for your response

kingstreet

What has happened with Halifax is not relevant to a new lender.

The property is unmortgageable if the new lender's criteria (which should be checked prior to application) and/or surveyor's opinion say it is.

It's impossible for someone on here to say what the outcome of another application to a different lender might be...

Your current advisor should now have sufficient motivation and experience to work out who to approach who will look at this case, or you should find someone else, if you no long have any confidence in them.

holly_hobby

Your historical relationship is irrelevant to the issue to hand - its the property you wish to pch thats the problem, so don't fret its you .

milly_molly_mandy wrote: »

We found a lovely house in a nice road that had been sub divided with mum living downstairs and son and wife living upstairs. It had not been properly converted and the only things that have been done are...kitchen upstairs, bathroom downstairs, locked door to stairs, 2 boilers, 2 electric meters.

Well a plus, is that the deeds haven't been split (ie its still noted as 1 residential dwelling with land registry) - so thats 1 positive we have.

However, to actually obtain a residential mge, the property will have to obviously be 1 single family dwelling - which means NO double/multiple kitchens, formal separation of floors (although I note you say you've addressed these 2 issues, in removing the 2nd kitchen, and returning it back to a traditional living space (?), and now have unrestricted access between floors), multiple main entrances, separate utilities, etc, etc. (NB -the 2 bathroom situ, may also be an issue IF the surveyor believes it further and negatively disrupts the traditional formal layout, but this will all depend upon the size and layout of the dwelling as a whole, and how its presence may impact any future resale opportunities).

The vendor needs to be aware of this, as unless they stumble on a cash purchaser, or a commercial buyer, they'll be in for the long haul ... as in my experience there will be NO surveyor whom will accept this (in its current format) as suitable security for a residential mortgage, as they are primarily acting on behalf of the lenders interests.

Your broker, IF they were aware of the property set up from outset, sounds either very inexperienced (which isn't their fault, and comes with time and exposure to non-standard enquiries such as this), OR is woefully inept ......as this is really v basic stuff .... you'll know in respect of your own broker which is the accurate description .

As Kingstreet states, you or your broker need to find out what changes the surveyor would need to evidence this as a single dwelling .... with the points noted above being typical requirements.

Hope this helps

Holly x

milly_molly_mandy

Thanks for your replies,
We are starting again with a new mortgage advisor and
mortgage on Monday. Until we get a surveyor around to
see it we don't know what is acceptable to them. If someone
new comes out the only thing left are the 2 electric and 2 gas
meters and 2 boilers. Its not unusual to have a downstairs bathroom so I cant see this being a problem.
Do you think we should get these changed before we even attempt to get another mortgage...it will cost money to change these things that I suppose the vendors should be paying.
The lady buying our house is very elderly and wants to be in our house asap.
many thanks

holly_hobby

No its no altogether unusual to have 2 full bathrooms in a larger property - again, it all depends on what the surveyors views are with regards the property as a whole. But as I made clear, I'm certainly not saying it will ... just something from knowing surveyors that may throw up a spanner with some, but not others. (ie if it throws up images of future lettings/granny annexs etc they may want further info)

The separate utility provision to the 2 halves of the house (indicating 2 separate households) WILL cause an issue.

But, I can't see the vendor being willing to change their current utility arrangemnts, based on a mortgage offer - but then again to facilitate the sale they may be happy to accomodate this.

My advice would be to instead find out a surveyors view on the propety in its current guise ... and if on inspection, the property now minus the 2nd kitchen and now fully combined living space, is satisfactory, then it will probably be a condition of the mge that on completion, the property has 1 utility svc - indicating a single family dwelling.

So, before anyone goes changing anything further, and if you are switching lender in any event, is to see what the comments are from the new survey (subsequent to the kitchen and inner partition removal), and take it from there.

But personally, and to potentially save wasting any more pennies, I would have firstly discussed this with the Colleys (Halifax) surveyor, for their comments on what amendments they would have accepted, in order to re-establish the property as a single dwelling, then see whether the changes are achieveable/within costings etc, and then decide whether you want to pursue the pch or look at alternatives.

Hope this helps

Holly

Thrugelmir

What appealed to you about the property. What plans did you have. As when you viewed it you must have been aware than some cost what be involved in reinstating the property into one unit. Also a lot of what you would be paying for in the purchase price would be scrapped, i.e. kitchen, boiler etc.

milly_molly_mandy

Thrugelmir wrote: »

What appealed to you about the property. What plans did you have. As when you viewed it you must have been aware than some cost what be involved in reinstating the property into one unit. Also a lot of what you would be paying for in the purchase price would be scrapped, i.e. kitchen, boiler etc.

Its in a great location and is a big house for the money..the whole place needs gutting and starting again..new bathrooms, kitchen redecoration etc. In our area there is nothing for sale at the moment and we plan on spending about 80k on it. We just didn't realise there would be a problem with it until the first surveyor came around. We offered full asking price as well due to the location.

milly_molly_mandy

holly_hobby wrote: »

No its no altogether unusual to have 2 full bathrooms in a larger property - again, it all depends on what the surveyors views are with regards the property as a whole. But as I made clear, I'm certainly not saying it will ... just something from knowing surveyors that may throw up a spanner with some, but not others. (ie if it throws up images of future lettings/granny annexs etc they may want further info)

The separate utility provision to the 2 halves of the house (indicating 2 separate households) WILL cause an issue.

But, I can't see the vendor being willing to change their current utility arrangemnts, based on a mortgage offer - but then again to facilitate the sale they may be happy to accomodate this.

My advice would be to instead find out a surveyors view on the propety in its current guise ... and if on inspection, the property now minus the 2nd kitchen and now fully combined living space, is satisfactory, then it will probably be a condition of the mge that on completion, the property has 1 utility svc - indicating a single family dwelling.

So, before anyone goes changing anything further, and if you are switching lender in any event, is to see what the comments are from the new survey (subsequent to the kitchen and inner partition removal), and take it from there.

But personally, and to potentially save wasting any more pennies, I would have firstly discussed this with the Colleys (Halifax) surveyor, for their comments on what amendments they would have accepted, in order to re-establish the property as a single dwelling, then see whether the changes are achieveable/within costings etc, and then decide whether you want to pursue the pch or look at alternatives.

Hope this helps

Holly

Unfortunately it was not a Colleys surveyor who came (they were all on holiday) and we have spoken to the one who did come and she said we had to speak to Halifax to find out their criteria. We cant speak to Halifax as they wont deal with us ..they have said we have to go to our advisor.
The house is empty and has been for the last few months and needs complete refurbishment. My husband checked and to change the utilites will take at least 6 weeks and cost over £1000

holly_hobby

Its not so much Halifax's criteria, but you want to pick her brains, and understand what she as a valuer would want to see, to enable HER as a panel surveyor (because she'll value for several lenders), to class the property as suitable security for residential lending ...

Really all this background work is the job of your Broker, even if something they're not come across before, quizzing the valuer will help them understand and learn how valuers think, which they can take forward to subsequent similar cases and thats how you gradually build your knowledge.

The 0 value I assumed was solely because of the 2 sc flats, but was there additional comments made with regards the condition of the dwelling as a whole ?

Because if this is the case, you may find that even if returned to 1 singular family dwellling, if there are all sorts of added retentions and recommendations re its general condition, then it may be no-goer irrespective of the re-marrying of the 2 units into 1.

The prob is you could just be throwing good money after bad (which we don't want), if there are several issues (rrespctive of its current use), that will either restrict available capital or entirely prevent residential lending on this.

If the 0 value was solely down to the sc units, then thats relatively easier to address (not withstanding any further amendments to unify the dwelling)

Anyhoo, try and have a chat with your broker and/or surveyor direct, re the nuts and bolts of the survey and their personal opinion on reqd amendments/works.

Hope this helps

Holly x