Buying a part finished house that is unmortgagable - advice needed!

Jetski

Hi all,

This is my first ever post so go easy on me! My fiancee and I are looking to buy our first house together. We have fallen in love with a place (I know this can dangerously warp your common sense so I am trying to stay objective) in Devon where we are relocating to.

The property is a partly converted barn project. Initially there were three derelict barns, two of which have been partly converted and adjoined, the third is yet to be started (just three and a bit stone walls). The plans are for the third barn to be converted and joined to the other two forming one large house.

The two barns that have already been partly converted are 90% complete. The walls and roof are complete, the doors and windows are in. Some wiring has been done (although this will need stripping out and redoing as it is the old style wiring). There is electricity and water in the barns and the drainage is all in place to a septic tank. But that is it. No kitchen, no bathroom, no boiler. So the property is currently unmortgagable, and it is advertised as such.

We are in a fortunate enough position to be able to buy the house as cash buyers, but that leaves us with very little left in reserve, certainly not enough to convert the third barn. What I am after is some advice as to what we would need to do to the two barns to get them into a mortgagable state to release funds to complete the third barn?

I have had the local buildings regulations inspector and a good local builder visit the site. The buildings inspector said it all looked good, with nothing major wrong with it and he would be happy, after we bought the place, to sign off the two barns as they currently stand as complete. He would then work with us during the third barn conversion and sign the whole property off at the end. The builder is going to quote for the third barn conversion, and for getting the two barns up to a mortgagable state. However we need to know exactly what is required to get a mortgage to finalise this quote! Is it literally just fitting a kitchen and bathroom? If so, what constitutes a kitchen and a bathroom at the bear minimum?

There is a chimney in the property, so we could fit a multi-fuel stove for heating, rather than an entire central heating system. Basically we want to spend the absolute minimum on the barns initially to get a mortgage to provide us the funding to complete the project. The mortgage value we would be taking would be less than 50% of the purchase cost, but I guess this isn't necessarily the value the mortgage surveyors would agree on. The house when completed should be worth almost double our initial purchase cost.

I'm sorry if this doesn't make a lot of sense, it's a bit of a brain dump from me, but I have never been involved in a purchase like this before so just want to be fully aware of the situation before committing to what could be a total nightmare, i.e. not being able to secure funds to complete the house!

Many thanks in advance!

kingstreet

Buildstore, or Ecology Building Society.

No real point going into detail. A high street lender isn't going to work for this.

martinsurrey

^agree,

self-build mortgage.

eddddy

An important aspect to investigate is getting a warranty and/or an architects certificate. A mortgage lender may require this.

(Google 'barn conversion warranty' for more info.)

It might be worth finding a mortgage broker with experience of barn conversion mortgages, to find out which lenders to target, and what their individual lending requirements are.