Help with bank unwilling to lend due to high number of buy to let flats

keeleycoop

Hi, has anyone ever been in this situation?

I'm a first time buyer with an accepted offer on a new build flat just outside of the M25. I've managed to raise quite a big deposit (had to due to the banks only being able to lend a certain amount based on my solo salary, which is fine)

The amount being lent was OK'd by the lender, however now it seems the bank has done a survey and is unwilling to lend because 90% of the flats in the building are being sold as buy to let and for some reason (I really don't understand this at all) that means that if the flat is repossessed they'll have trouble reselling it......my mortgage broker is appealing the case and I'll be contacting them on Monday to see if it can be overturned.

It seems everywhere I viewed when originally looking for a place a large proportion of the surrounding flats had been bought by investors, so how is a first time buyer supposed to get on the property ladder if the banks won't lend for this reason!? I certainly cannot afford a freehold house that won't have this issue!!

Has anybody been in this situation at all and can offer advice? It doesn't seem like there is anything I can do as I can't change how the rest of the flats have been bought in the building!

kingstreet

What does your broker say?

Different lender?

Which lender did you apply to and what's the loan to value?

AnotherJoe

Do you want to live in a property which is 90% people who have no particular interest in the building or any issues with it, can cause issues not caring since they can leave any time?

I'm guessing many wouldn't, which is presumably why they think they'd have issues selling it and so maybe you would also ?(except as a contradiction to that if its been sold 90% as BTLs seems there's a market for that anyway ?)

keeleycoop

Thanks for all the quick replies

My broker (from London and Country) basically said it was not in my control and that all I can do is wait for the result of the appeal, which I will not hear back from before Monday.

The lender is Santander and my LTV is 60%.

Unfortunately I have no idea what kind of people have bought the other 90% of the flats in the building, when I originally went to view it was still being completed and was empty at the time. The only info the broker gave me was that they were BTLs.

getmore4less

Not sure if it still goes on,

big landlords would underwrite a block at a discount rates, the builder also got to put up XX% sold making it look like there was demand.

the builder would retain the option to sell some of the underwritten properties.

resale then becomes an issue as the true sale prices filter through to the land reg.