Ex Council High Rise Mortgage

JohnD4296

I have a:

• 1 Bedroom
• Ex Local Authority flat
• Pre-cast concrete construction (slabs/panels)
• Total of 11 floors
• Served by two lifts to all floors (one to odds, one to evens)
• 2 Internal staircases
• Secure entry
• Situated in the much acclaimed Alton Estate (within which some of the blocks are listed), Roehampton, SW15 (adjacent to Richmond Park). The area is great and there is significant investment taking place/scheduled.
• In the 5 years that I have owned the property it has nearly doubled in value.

Background
Initially I got a fixed rate mortgage through HSBC.

In the last couple of months they ammended their policy to now only lend up to the 4th floor of a block with no more than a total of 10 floors!?! The local branch advisor is equally frustrated and baffled by this move as I am, as it has seriously affected her targets! For me this means I could not take my mortgage elsewhere to an equal flat even on the same floor height.

I acknowledge the caution to be taken, with potential re-sale in the future and responsibility for repairs. However I purchased my property cheaply and could not afford anything else comparable for floor space/location in London/a commutable area.

Elsewhere in Europe this type of living is the norm and I can't understand why Multinational Mortgage Lenders can't see the potential that these properties present for first time buyers in the UK.

I am looking for a mortgage, to enable me to move from a 1 bedroom to a 2 bedroom flat within the same estate. I have more than 20% deposit but am not prepared to pay premium interest rates.

Any suggestions?

RenStar

Hi there,

just wanted to say I had a similar problem when I came to remortging our flat though mine is only 8 floors and is in a so-called 'Olympic gold mine' area . Initially, I got my mortgage with the Halifax but then when I wanted to remortgage, I was told a lot of lenders had changed their rules and most now also wanted 50% or more of the flats to be privately owned which they didn't about 4 years ago. Anyway, I ended up going with Abbey who though they didn't have market leading rates, were great. I used a good broker who knew which lenders were more likely to lend on those type of properties. She was worth her weight in gold and I recommend you do the same. Good luck!

Ren

JohnD4296

Hello,

Thanks, I'll give them a call.

Incidently, I thought I'd try at the top and e-mailed Gordon Brown as if he enabled the purchasing of these properties he would easily meet that aim of getting people on the property ladder.

If you fancy it, here's the link to do the same:
http://www.number-10.gov.uk/output/page821.asp

Regards

JD

wardlaw

Try the Royal Bank Of Scotland

UK007BullDog

I can understand your frustrations. It used to get me as well when I was a broker, and now working for a High street bank we will not touch concrete construction of nearly any kind. We have a long list of concrete builders the bank "might" consider if a full structural survey is done. As flats cant have those.......

Only non council flats in purpose built areas or posh postcode areas will be considered, hence the concrete flats in Canary Wharf have hardly a problem finding a lender.

You will need to find a broker who might be able to help you find a lender. There are so many points going against you that it will not be easy on your own. I don't think Abbey will do it, might depend on which floor your flat is.

As you are looking for probably a non-highstreet lender, you might have to pay higher fees and a somewhat higher interest rate.

I know it is not fair but that is the lender for you (actually some sort of analyst in some back office who have decided to change the rules).

Alternatively, remortgage the property with the same lender as a BTL, rent it out and use the money towards the new property.

For the new property make sure it fits their criteria of "now". It is not set in stone but most lenders have some of these rules and some unique to them:

1. Flat not higher than 4th floor.
2. Building no higher than 5 floors.
3. No balcony access.
4. Not ex-local authority owned.
5. not of any concrete type
6. no shops underneath or opposite the street (especially no fast foods, bars, pubs or dry cleaners)
7. depending on numbers of properties in a block some lenders restrict themselves on how many they are willing to lend on.
8. A certain percentage of the flats have to be privately owned.

Those really are the basics.

One way to find out who lent on your property in the last 2 years is to call the local surveyors and they can tell you who they did surveys for. You then call up those lenders and find out make sure they tell you if they have their books full for that address. Some of those lenders can only be accessed via a broker though.

Example: Point no 7. : due to construction type lenders A & B used to lend on Block XY. there are a total of 100 flats in that block. Lender A has 30 on their books and wont take on any more (to spread the risk in case something happens to the building). Lender B has 15 on their books and will take on another 5. Once they have 20 properties they will take on no more. No other lender will lend on those properties so in effect the rest of the council tenants wanting to buy are stuck, unless a third lender comes along.

Point 8: I was told the reason they are now much tougher on the rules is that the best properties have been bought by the tenants and now only the "bad" stock is left. I don't believe that in a minute!

When you apply for the mortgage make sure the survey fees gets added to the loan. If the survey fails you are not out of pocket with no risk to you. If it passes and the lender goes ahead send the lender a cheque of the survey fee to pay it right off your mortgage, or just let them know you now want to pay for the survey up front.

Good Luck!

AndyWallace

RenStar wrote: »

Hi there,

just wanted to say I had a similar problem when I came to remortging our flat though mine is only 8 floors and is in a so-called 'Olympic gold mine' area . Initially, I got my mortgage with the Halifax but then when I wanted to remortgage, I was told a lot of lenders had changed their rules and most now also wanted 50% or more of the flats to be privately owned which they didn't about 4 years ago. Anyway, I ended up going with Abbey who though they didn't have market leading rates, were great. I used a good broker who knew which lenders were more likely to lend on those type of properties. She was worth her weight in gold and I recommend you do the same. Good luck!

Ren

Abbey are likely to consider this. Most other lenders will refuse on its construction type and numbers of floors. Some will even need to know the 'type' of concrete used.

herbiesjp

Does the current vendor have a mortgage on it? Can you find out who with?

A good whole of market adviser will be able to touch base with several lenders for you and their surveyors to see which lenders have given mortgages there in the past and if they are likely to do so again

HTH