Buying two flats to turn into one house advice

jpsmythe

Hi there! So my wife and I want to buy a house that's been converted into two flats, then turn those flats back into one house. The issue is: the mortgage.

Most lenders, as we understand it, won't lend on the promise of the house being a house--they'll value it as two flats. Most people won't let you have a mortgage on two properties that adds up to 100% ownership of a property (as best I understand it (which is not much at all)). Somebody's suggested we buy one each—as in, I buy and have a mortgage on one flat, my wife on the other... But this all seems insanely complicated.

The ideal is that the property titles are folded into one before purchase, but this is unlikely to happen, I think. 

Does anybody have any advice/tips? Has anybody done this?  

user1977

The titles aren't really the problem, it's the physical work involved. You'd almost certainly need development finance, as no "normal" mortgage lender would want to get involved with the project and risk repossessing a building site (or possibly half of a building site!). Once you've got a complete house, you could then remortgage.

Also bear in mind that SDLT (or equivalent) is based on the position when you buy, so you'd be buying (at least) one "second" home and the additional rates of tax would apply.

Have you also checked the planning position, as you may well need planning consent.

RedFraggle

Depending on where it is it might also devalue the property overall so may not stack up financially. 

penners324

If you don't use a mortgage it's doable.

With a mortgage it's not possible