Getting a mortgage for uninhabitable property with no work or credit history?

ACG

chilswelluk said:

Deleted_User said:

Forget this property.  No one is getting a mortgage for it.

But I want to do a renovation.  It's something I enjoy doing and can get a much bigger property with land this way.  I have helped friends with similar renovations for houses that were left to them in a will.

Even if I save more money than the 30k I currently have, I still want to buy a similar property.

The only way you would get this property is with a bridging loan. They lend against the asset value, a residential mortgage lenders against a home - which this would not be (until the work is complete). 

A bridging loan is for a maximum of 12 months and is generally around 12% interest for the year. 

Your not going to get this with everything else to contend with. 

My first home was a renovation project but by renovation I mean it needed a new kitchen and bathroom, GCH and decorating. You could live in it, but it was a throwback to 70s and reliant on storage heaters. You can get renovation project properties but you need to be able to live in it really even if you plan on living in a caravan on site so to speak. 

chilswelluk

ACG said:

The only way you would get this property is with a bridging loan. They lend against the asset value, a residential mortgage lenders against a home - which this would not be (until the work is complete). 

A bridging loan is for a maximum of 12 months and is generally around 12% interest for the year. 

Your not going to get this with everything else to contend with. 

My first home was a renovation project but by renovation I mean it needed a new kitchen and bathroom, GCH and decorating. You could live in it, but it was a throwback to 70s and reliant on storage heaters. You can get renovation project properties but you need to be able to live in it really even if you plan on living in a caravan on site so to speak. 

That's a real shame, as it's the only type of property I am interested in.  I want somewhere detached with a bit of land and any property of this type that simply needs some light renovation etc is well outside my price range.  It sounds like my only option is to buckle down and save for 10 years or so and become a cash buyer.  I can move into a cheap room rental in a shared house and see how much money I can put away.  It just means the years will tick by before I can buy something.  Not ideal when you are middle aged.

[Deleted User]

With starting your new job etc, will you have the energy and time to do this project, what if the job eats into the spare time or leaves you exhausted for weeks on end  - surely you're not thinking of doing the project until you drop ?
I like the idea of the project but just thinking about running it alongside a paid job tires me out 

chilswelluk

[Deleted User] said:

With starting your new job etc, will you have the energy and time to do this project, what if the job eats into the spare time or leaves you exhausted for weeks on end  - surely you're not thinking of doing the project until you drop ?
I like the idea of the project but just thinking about running it alongside a paid job tires me out 

Not really worried about this.  I am planning for the long haul and think it may take me more than 10 years to complete.  It's a case of when I have the time and money to throw at it I will.  I am also okay living in a caravan on site.  My first priority would be paying off any mortgage / loan before I get stuck into any serious building work. I am certainly not in a rush to finish the project, but would like to start the ball rolling.

I think a project like this would give me purpose and a sense of achievement. I can't really get excited about buying any other type of property.  It's something I have always wanted to do.

chilswelluk

clive0510 said:

we did pay cash with the help of a large personal loan from alliance & leicester . we told them the money was home improvements. 

Wonder what the most I could get in an unsecured personal loan would be?  I guess I would need some sort of credit history?  If I save hard, I could possibly increase my savings to 50k within the next year (I also have some private cash work that I do).  I could then take out a couple of credit cards and make small purchases on each per month.  Wonder if that would be enough to get a large unsecured personal loan?  I guess they would be more inclined to lend if I told them I wanted the money for a new car, motorhome, boat etc.

ACG

Maybe a "happy" medium could be something that you could get habitable within 12 months to get you off the bridging loan on to a residential mortgage. But that would be risky in the current climate anyway as the next 12 months could be hit or miss with property prices or possibly buying land with planning permission, but I appreciate that is not quite as nice as a renovation project. 

In any event, you would probably need a good 30% deposit plus the money to do the work. 

chilswelluk

ACG said:

Maybe a "happy" medium could be something that you could get habitable within 12 months 

Anything I can get habitable within 12 months is way outside my budget for the type of property I want to buy.  It would be a huge compromise for me and very stressful to do all the work in such a short timeline.  Then to top it all off, COVID may cause house prices to slump, which would mean I could find myself in negative equity, stuck in a house for many years that I never wanted to buy.  It could turn into an absolute nightmare.

I really want a project that I can devote my life to over many years.  Not looking to make a quick buck, but looking for a forever home.

dimbo61

To get a mortgage on a property it needs to have a " working kitchen and bathroom " 
Now it does not matter if the kitchen is 70 years old and little more than a sink and stove ( oven ) and bright green bathroom.
Hole in the roof will come up on survey so again you need funds to do the essential repairs.
£38K a year is a good income well done 
After 3/6 months you can (1) Save like mad and (2) produce wages slips and banks statements to prove income.
Get a good broker and buy a suitable property you can value too.
Side /Rear extension, complete renovation of the interior with new bathroom and kitchen.

chilswelluk

dimbo61 said:

After 3/6 months you can (1) Save like mad and (2) produce wages slips and banks statements to prove income.
Get a good broker and buy a suitable property you can value too.
Side /Rear extension, complete renovation of the interior with new bathroom and kitchen.

The problem is I don't see any other properties that I am interested in within price range.  The very maximum I would be prepared to borrow would be 100k, but ideally no more than 70k.  I want to be mortgage / loan  free within a few years.  I would not throw serious money at the renovation until I had paid the mortgage off.  As I say, it's a long term project that I want.  That's why I don't want to compromise.

MovingForwards

chilswelluk said:

clive0510 said:

we did pay cash with the help of a large personal loan from alliance & leicester . we told them the money was home improvements. 

Wonder what the most I could get in an unsecured personal loan would be?  I guess I would need some sort of credit history?  If I save hard, I could possibly increase my savings to 50k within the next year (I also have some private cash work that I do).  I could then take out a couple of credit cards and make small purchases on each per month.  Wonder if that would be enough to get a large unsecured personal loan?  I guess they would be more inclined to lend if I told them I wanted the money for a new car, motorhome, boat etc.

Not for purchasing a property. If you say it's for a car etc that's application fraud and could see you with a CIFAS marker.

You will have to keep saving if you want the type of people you are looking at.