Buying a unfinished house via a repossession

mistasparkaru

Hello All,


Ok this is a bit of a complicated one, we desperately want to buy a house we have seen. We have accepted an offer on our house and we should have enough to buy it and complete the house.

I have around £110K equity and the new house is up for sale at £250k (hopefully less as its a repo) and completed it could be worth well over £350k I figure it will cost me around £40k (not going on the mortgage) + a years part time work to complete.

but there are a few complications

1. Its a repo, so we won't know if we have got the house until the exchange
2. Supposedly the building control/regulations have not been signed off, but planning permission was gained.
3. The house is not finished, the shell, roof, windows, second floor are in and so is the electric and water feed to the site.

How on earth do I go about getting the house? the building work isn't a problem for me but I'm not sure if any bank will loan me the money I need.

Will the council let me get a retrospective building control sign off or completion certificate?

Will any banks lend to me on an unfinished house without sign off?

G_M

I'm confused. You seem to be saying the house is half-built (hence the difficulty with the mortgage)?

But in that case, why would retrospective Building Control be needed? This would not be granted till the building is complete............

There are mortgages available for self-build houses: the mortgage is usually released in stages as building progresses. See an independant mortgage adviser.

Once you've finished the building work, the BG inspectors will sign it off (though they'll need to inspect as work progresses).

As for the purchase - there's no guarantee as it's a repo. Get to Exchange asap.

davidmcn

G_M wrote: »

Once you've finished the building work, the BG inspectors will sign it off (though they'll need to inspect as work progresses).

This may be the problem, if they have missed the chance to inspect the earlier stages of the build.

Loonytunes

Just to say that having just unsuccessfully tried to by a repossessed house (beaten by a much higher offer) repossessions go through very quickly (14-21 days). Also, I was expected to show proof of funds at the point of putting in my offer so you need to get this sorted first.

mistasparkaru

davidmcn wrote: »

This may be the problem, if they have missed the chance to inspect the earlier stages of the build.

Yes thats the problem, the roof is on and windows in, and supposedly none of the building controls have been signed off... i thought they had to be done when the foundations were complete, then when the walls were up and then again when the roof is on.

G_M

mistasparkaru wrote: »

Yes thats the problem, the roof is on and windows in, and supposedly none of the building controls have been signed off... i thought they had to be done when the foundations were complete, then when the walls were up and then again when the roof is on.

Are. Yes.

BC will need to excavate to examin the foundations, remove plaster etc to examine the structure of walls/insulation etc - so they will probobly chrage extra for this ectra work plus leave you to make good again.

mistasparkaru

G_M wrote: »

Are. Yes.

BC will need to excavate to examin the foundations, remove plaster etc to examine the structure of walls/insulation etc - so they will probobly chrage extra for this ectra work plus leave you to make good again.

Ah ok, so it is possible then... I had imagined a little jobs-worth with a clipboard saying knock it all down.

jamesd

Phone building control. Tell them that yo are considering buying the place. Ask them to tell you what the current state of play is with them and what they will want to do after you buy it based on your description of the work that's been done so far. While it won't help much with them having to check things, they will be happy to have a person who's willing to work with them and try to do things right and that will inevitably make the process easier.

mistasparkaru

jamesd wrote: »

Phone building control. Tell them that yo are considering buying the place. Ask them to tell you what the current state of play is with them and what they will want to do after you buy it based on your description of the work that's been done so far. While it won't help much with them having to check things, they will be happy to have a person who's willing to work with them and try to do things right and that will inevitably make the process easier.

I rang the council who confirmed that planning permission was granted but that building controls wouldn't talk to me as I didn't own the property yet, and that I should ask the seller to tell them its ok to talk to me...but its a repo being handled by a repo company

jamesd

repo company may be wiling to do that anyway as part of helping the process go more smoothly. Might even give "tell anyone who asks" consent.

Hashbrown_2

When you buy a repossession, you buy it "as seen". The agent isn't going to be much help because they're passed to them by a corporate agent and they're interested in turning it around promptly because they're more hassle than the 1% fee they're getting charged to sell it.

Technically, the agent must market up until the day of exchange but in all honesty, a decent one, so long as you're moving it along, i.e. having surveys, paying for searches etc, will put off showing people. They'll get paid exactly the same if they sell it to you, as they will if they sell it 100 times over.

Regarding the building regulations, the fact it needs £40k work to add £100k value means that the agent has factored that into the price. Realistically, the bank aren't going to have any issues with it. They just want to make sure it's worth the money you're paying for it, which, by all accounts, it is.

If it were me, I'm not totally convinced I would even go for retrospective planning consent. The reality is, they're not going to find out and when it comes to you selling it, the issue will arise but you'll be able to offer an indemnity insurance which is going to cost circa £100.

Perhaps not textbook advice, but this is what happens day in, day out.