Mortgage & renovations question

sourpuss2021

Is it possible to buy an an unmortgageable doer-upper property for cash.   And then six months later, obtain a residential mortgage for around £75k to fund the needed renovations? Or is there a similar type of loan that could be paid back slowly and at a competitive rate?

Would the vendors of such a property want to see proof of renovation funds, or they may not be bothered so long as you have enough to take it off their hands?

The situation is where a person looks like getting access to capital to purchase a property but doesn’t yet have any employment.  The property would be in London.

Anyway this is theoretical as the unmortgageable cash only property I was interested in, sold to someone else within the week.  I also don’t have funds yet, but parents would like to pass money on soon.  They’re worried about what’ll happen in the Autumn budget. 

Maybe it would be better to focus on getting employment and then buying somewhere mortgageable using the capital and a mortgage?  There’d likely be a loan to value of about 28%, but employment is the issue as it’ll likely have to be something minimum wage and easy to get.  But it’s in London which should help.  

Hoenir

sourpuss2021 said:

Is it possible to buy an an unmortgageable doer-upper property for cash.   And then six months later, obtain a residential mortgage for around £75k to fund the needed renovations?

If nothing has changed then the property remains unmortgageable. 

sourpuss2021

Hoenir said:

sourpuss2021 said:

Is it possible to buy an an unmortgageable doer-upper property for cash.   And then six months later, obtain a residential mortgage for around £75k to fund the needed renovations?

If nothing has changed then the property remains unmortgageable. 

Ah, good point!  

So I’d need / have needed the purchase price plus the cost of fitting a kitchen (ballpark £15k).   The advert said the absence of a kitchen was the reason it wasn’t mortgageable.   

The renovation costs look to have been comfortably factored into the listing price so there probably wouldn’t have been much mileage in bidding lower. The property sold within a week.

All that said, providing a property is by then mortgageable would I be able to get a mortgage on residential terms for a renovation, 3-6 months after a cash purchase?   

ritz55

My understanding is the property needs to be habitable to be mortgageable. For it to be considered habitable it needs a kitchen, bathroom, toilet etc. the overall condition doesn’t matter as such as long as someone could live in it. 

MWT

sourpuss2021 said:

All that said, providing a property is by then mortgageable would I be able to get a mortgage on residential terms for a renovation, 3-6 months after a cash purchase?   

Generally speaking you would need 6 months from the date you are registered as the owner, if you are looking for normal residential terms I believe.
See what one of the brokers who post on here has to say though...