A little advice please

melj16

I've been looking for a property to have as a BTL for a couple of months.

My husband and I have viewed a house a mile from our own home, which requires a Central Heating system as it doesn't currently have central heating at all. Only two fires downstairs. (My cousin is able to supply all materials at cost price, and then a family friend to fit the system and will charge a daily rate for his time - so I have been given a rough idea of how much this will set us back)

The property is over 100 years old, has no damp which is great

After liaising with our mortgage broker over the past couple of months, we are going to be applying to Birmingham Midshires. Purchase price £40k, with 25% deposit. My annual income is less than £25k which stops me accessing many of the other lenders out there offering BTL products. My husband is a Non Uk National without indefinite leave to remain, working for a foreign company and paid into a foreign bank account so therefore his income cannot be used.

When the property is valued, are they likely to kick up a fuss with it not having central heating, or would they be happy knowing that the work will be done prior to being rented out.

It has polystyrene tiles on the ceilings of the bedrooms - is this likely to cause any problems for the lender?

The property is a little dated and other than the central heating which is a big(ish) job, the other work required is more cosmetic, new carpets, old dated wallpaper removed, plastered and painted walls etc.

How are Birmingham Midshires? Are they fussy with whom they lend to or fussy on the properties they mortgage on.

Any advice would be welcomed

Thanks in advance.

ACG

Dont forget it isnt just a case of installing a boiler and radiators - you also have to get it connected to the mains AND (the biggest pain in the....) getting national grid to give you a meter point reference number and THEN waiting for it to update to get a supplier to acknowledge it.

I had fun and games with mine about 12 months ago.

If you are miles from the nearest mainline you might find it costs a fair old bit. Mine was literally about 20-30 yards so not too bad.

It not having GCH should not be a major issue, but it will come down the surveyor and his comments. If its not normal for those types of properties then it could be an issue.

The polystyrene tiles are likely to be the biggest issue as theyre illegal on let properties now. The valuer may decide it is not lettable in its current state (which is correct), however he may decide its a minor job and they can be taken down in an hour or 2 (my house had them when i bought it, but mine was not a BTL). The lender may decide on a retention, which basically means they will offer the money subject to that issue being resolved - which may mean you need a bridging loan for example for a week or 2.

Your broker should really be on the phone to the lender discussing these issues with them. If you have not told your broker, tell him/her. You need to know what the lenders stance will be before outlaying any money on fees (valuers/arrangement/solicitors/broker etc).

melj16

Thanks for your reply.

The property has gas already (dont know if this makes a difference)
There is already a boiler in (for the hot water) and there is a gas fire in too, gas cooker. Just no radiator at all.

I havent spoken with my broker about the tiles yet, as she was off on friday, but is back tomorrow so will speak with her about that.

Would they really put a retention for the tiles on the ceilings....as, like you say they can be removed within a couple of hours. Could this be done prior to the house sale completing.....if the vendor agreed to it, the house is empty, and if they are illegal (or is this just on BTL's?) then anyone needing a BTL mortgage would require them removed anyways?

ACG

If there is already gas then it may just mean the copper pipe will need increasing (more gas needed as its not just a fire/cooker its a boiler too...) i have no idea, im just thinking worse case scenario so you have something to think about. Im sure your gas man person can confirm that.

I have no idea about the retention, its not illegal to have those tiles but im sure it is if the property is being let out. A residential property and it would not be an issue. This is why im suggesting you speak to BM beforehand - i dont think they will release the money whilst they are there, however i have never that scenario hit my desk so i could be wrong. If it is an issue, a couple of hours with a scraper and you will be fine so it can be done before the surveyor goes round. My hall way took me literally an hour and a half at the most.

kingstreet

What happens if the property doesn't value up?

The BMS minimum is the lower of valuation/purchase price and £40k.

melj16

I am confident it will meet the £40k valuation, its up for more than that, we've had the offer accepted for a quick sale as the owners are elderly and have already vacated the house so just want to get rid. Going by the recent sales in the same street, I dont think being down valued should be an issue (although, i'd never say never)

My mortgage broker checked with a local valuer, who said the poly tiles wouldnt be an issue - which is good

Thanks again for the advice