Mortgage valuations on “fixer-upper” properties

simon_or

I've bought properties like this in the past with BTL mortgages, it's always a 50-50 depending on the surveyor that comes to visit. On balance your issues like the hole in the chimney and extensive damp damage sound a bit too much but hope the surveyor feels otherwise.

If you really like it and can't get a high street mortgage, get a bridging loan, fix the serious issues and then remortgage. You will need a 25% deposit though for that.

rolo267

@simon_or thanks for your insights. Maybe I’ve over-exaggerated the damp. I am not an expert, nor do I have much to compare it to, but it doesn’t look great. It’s only around one chimney breast, starting about halfway and going up to the top. It’s obvious what the issue is with it, and I had a couple of builders take a look before putting in my offer… both identified the gash in the chimney flashing and estimate it would be simple and inexpensive to remedy, but all depends on the opinion of the individual surveyor I suppose. The valuation took place this morning but no update from nationwide to say a reports been received yet. I’m so anxious.. this waiting game is horrible! 

rolo267

@K_S I promised to update the thread when hearing back from Nationwide… this morning I received three text messages. One to say the valuation report had been received, another to say it had been reviewed and accepted, and a third to say they’ve issued me a mortgage offer. 

Does this mean everything checked out ok with the house and that I’ve passed all the affordability checks etc? 

If I was to get an independent survey on the house for my own sake, do I have to share the results of that with the lender regardless of the fact they’ve issued me with my mortgage offer? This bit isn’t clear to me. 

Thanks! 

K_S

@rolo267 That's amazing, and yes that should mean it's all gone through!

Ind survey - no you have no obligation to share the survey report with the lender or your solicitor. As far as the lender is concerned, the property meets their requirements to qualify as security for the loan amount being advanced to you.

rolo267 said:

@K_S I promised to update the thread when hearing back from Nationwide… this morning I received three text messages. One to say the valuation report had been received, another to say it had been reviewed and accepted, and a third to say they’ve issued me a mortgage offer. 

Does this mean everything checked out ok with the house and that I’ve passed all the affordability checks etc? 

If I was to get an independent survey on the house for my own sake, do I have to share the results of that with the lender regardless of the fact they’ve issued me with my mortgage offer? This bit isn’t clear to me. 

Thanks! 

rolo267

@K_S amazing thank you! I was expecting they would want further independent surveys before making their decision but seems that’s not the case! I was worried they may withdraw my mortgage offer if I get my own survey and was legally obliged to share it. Since that isn’t the case, I’m definitely gonna get one done for my own peace of mind 

Jamespearce86

Hey everyone, I just wanted to jump in on this as I'm in a similar position to OP - we had an offer accepted on a house that is habitable but needs mostly modernising and cosmetic improvements, and it needs central heating installed which I've budgeted for. 

We got a generic response from Nationwide: 

The Valuer has declined the property and provided the following comments:

"The security is in a very poor condition and has been declined on the grounds of multi trade works required. The property requires extensive renovation and repair including refurbishment of the fabric, fittings and services (which will involve multiple trades). As such, the property is not considered suitable security for mortgage purposes and no valuation figures have been provided."

The price we've had accepted is £80k less than an identical house that sold a few years ago, and we have plenty of budget to make the fixes. 

I've asked Nationwide to give us more specifics and also got another advisor to help secure a new deal. 

It just seem very arbitrary that it was declined! Any advice welcomed!

FreeBear

Jamespearce86 said:

Hey everyone, I just wanted to jump in on this as I'm in a similar position to OP - we had an offer accepted on a house that is habitable but needs mostly modernising and cosmetic improvements, and it needs central heating installed which I've budgeted for.

Do have a look at installing a heat pump rather than a gas/oil boiler - If the system is appropriately sized and well tuned, the running costs should be comparable (or even cheaper) than a gas boiler. With the relaxation of the rules on meeting EPC recommendations for insulation upgrades along with the £7500 government grant, installation costs shouldn't be much higher. Regardless of which fuel you use to heat the place, you still want to insulate as best you can within your budget - Doing so will cut heating costs.

Jamespearce86

FreeBear said:

Jamespearce86 said:

Hey everyone, I just wanted to jump in on this as I'm in a similar position to OP - we had an offer accepted on a house that is habitable but needs mostly modernising and cosmetic improvements, and it needs central heating installed which I've budgeted for.

Do have a look at installing a heat pump rather than a gas/oil boiler - If the system is appropriately sized and well tuned, the running costs should be comparable (or even cheaper) than a gas boiler. With the relaxation of the rules on meeting EPC recommendations for insulation upgrades along with the £7500 government grant, installation costs shouldn't be much higher. Regardless of which fuel you use to heat the place, you still want to insulate as best you can within your budget - Doing so will cut heating costs.

Thanks, we're still weighing up what heating system to put in - depending on the insulation etc, but we still need a mortgage for any of this!