FTB mortage application rejected above commercial

Peggio

HI everyone, I need an help as struggling to buy the perfect flat after months spent in searching it.
In November I had an offer accepted on a 2bedroom in SE1 (bermondsey) just above a shop (printing company, next to a pizza takeaway). The price is good as £420.000 for the area was impossible to find few years ago. Converted flat on 3 floors building, brics. 
I had API accepted, LTV 85%, 4x salary. I did an application through a broker (he choose Skipton) and just after Christmas they rejected the application. The broker said the issue was the flat just above a commercial. He proposed to go through Natwest as usually they accept this kind of flat. After 1 week they rejected too.
The agency said to use halifax, as they were lenders for that flat in the past. I paid £200 valuation fee, and halifax rejected too. The feedback was "saleability of the flat". 
Is there any chance to find a lender in the next few weeks, once the Stamp duty holiday will be back and the whole market will settle down? 
Or I need to start searching for something else?
If the seller reduce his price and I apply for a LTV80%, is there any chance to get an offer?
Thanks

K_S

@peggio Natwest would be my go to lender for these sort of properties, especially on London high streets. I just placed a similar flat in SE13 with Natwest BTL. If it was a matter of LTV, they would have offered to lend at a lower LTV - did any or did they just give a zero valuation?

Peggio

I do not know what Natwest and Skipton said and if they proposed a lower LTV as it was through broker.
Halifax replied "Lending unsuitable: saleability. I have not provided a valuation because the property is not acceptable to the lender due to the significant impact of being above a retail shop and adjacent to a takeaway. The use and proximity of the commercial premises significantly limits demand and saleability."
Both real estate agent and broker were suprised by this statement. 

K_S

@peggio Well, tbh if NatWest has declined and the broker says they didn't offer to lend at a lower LTV, then I would be inclined to move on. But of course that's just based on the limited information in your post and assuming the rest of it.

Peggio

Thanks @K_S
but... if no building with cladding or render can have a mortgage (as almost everyone has inflammable insulation) and now 3 lenders refuse a brick building just above commercial, who is getting a mortgage in London? 
Could it be at the moment the banks being very choosy and I have hope to receive an offer in 4-6 weeks time?

K_S

@peggio Flats above commercial premises in London can indeed get mortgages, I've placed one in SE13 with NatWest BTL just this week. Flats in buildings with cladding can also get mortgages, with the right certificates.

I can understand your frustration, but these kind of flats are always "subject to valuer comments" and no two properties are exactly the same unfortunately.

MWT

Exactly what sort of 'commercial premises' the flat is over or adjacent to will play a part as well, and take-away food outlets have never been popular as neighbours.

I doubt you would have had the same reaction if it had bee over an Estate Agent or Accountants office for example with no food outlets around...