Getting a mortgage on a property in poor condition

montyjohn

I'm looking to buy a Grade 2 listed property that needs a lot of work. There is potential for some limited structural work and resolving some significant damp issues. The property has been empty for a couple of years.

The property is technically habitable, as it has a kitchen, bathroom, central heating etc, but my broker has said that it will be trial and error to find a mortgage company who's surveyor doesn't provide feedback that stalls the sale.

I really don't want to play trial and error with mortgage companies. Sounds time consuming.

I was hoping I could be pointed to a specialist mortgage company that would take a more pragmatic position.

I have good credit rating, only need 2X my salary and the LTV is only 30%. And most of that is for renovations. I could probably get away with an LTV of 10% for just the purchase of the property.

I've looked at a personal loan, but with interest payments of 13% and no guarantee it will suceed, this seems an expensive way of doing it.

I also spoke to a bridging loan company, but they had product fees in the order of £14k.

Are there no reliable ways of getting a mortgage in this situation?

ButterCheese

Grade II listed building - sorry to be harsh but if you need a mortgage to buy it then I would re-consider.  They can be money pits.  I have relatives who live in one.  Any alterations were a royal pain to get permission for.  Any that they did do, required specialist tradespeople e.g. building a garden wall with natural, local slate in the period style (16th century).  They have now had the property on the market for a year with no viewings, and it is not especially expensive for the size of the house and land.

They also wanted to convert an adjacent shed to livable dwelling, but were flatly refused as it wasn't "in keeping with the original building".

In addition to that, you may find that joists and rafters are made from actual branches and tree trunks, and walls are made from natural stone/granite.  This was a nightmare to work with - you can't take it portions of stone like you can remove bricks.  Nothing is square or level or plumb in the house.  And the fact that it has damp issues would be the final straw to put me right off

ACG

Try another broker.

It can probably be done, but you have the choice - trial and error and get better rates or get a sure thing but it will cost more. 

Bridging loans are expensive but that sounds expensive - unless its a large loan. 

gwynlas

Is it just the facade that is listed or internal features as well?

There are forums for period house owners who might point you in the direction of approachable lenders who use suitably experienced surveyors.

twopenny

Have you asked the listing officer for your area?
They can be really helpful and could give you some idea of what the restoration actually involves.
It would be worth it as there maybe things that need changing too that they hadn't anticipated.
Should know about mortgages too from other buyers.

I was working with one when an owner decided to do internal renovations and the house was in danger of collapsing because of lack of knowledge and it was the dickens stopping him. That was grade one 

montyjohn

ACG said:

Try another broker.

It can probably be done, but you have the choice - trial and error and get better rates or get a sure thing but it will cost more. 

Bridging loans are expensive but that sounds expensive - unless its a large loan. 

Yes, this will likely be my next step. Thanks.

montyjohn

gwynlas said:

Is it just the facade that is listed or internal features as well?

There are forums for period house owners who might point you in the direction of approachable lenders who use suitably experienced surveyors.

Regardless of Grade, the listing includes everything with the curtilage, inside and out. 
The only way to find out if you need consent for works is to apply for consent.

Anything simple like repainting interior walls with limewash I would be more than comfortable not getting consent for, but any alternation, the assumption is you need consent.

montyjohn

ButterCheese said:

Grade II listed building - sorry to be harsh but if you need a mortgage to buy it then I would re-consider.  They can be money pits.  I have relatives who live in one.  Any alterations were a royal pain to get permission for.  Any that they did do, required specialist tradespeople e.g. building a garden wall with natural, local slate in the period style (16th century).  They have now had the property on the market for a year with no viewings, and it is not especially expensive for the size of the house and land.

They also wanted to convert an adjacent shed to livable dwelling, but were flatly refused as it wasn't "in keeping with the original building".

In addition to that, you may find that joists and rafters are made from actual branches and tree trunks, and walls are made from natural stone/granite.  This was a nightmare to work with - you can't take it portions of stone like you can remove bricks.  Nothing is square or level or plumb in the house.  And the fact that it has damp issues would be the final straw to put me right off

My advice to anybody looking at listed buildings is limit your search to properties that you like as they are. You're going to struggle if you want to make material changes.

Repairs are very easy to get consent for provided you use the correct techniques and materials. It's not in anybody's interest for a suitable repair to be refused.

As for costs, I would do a lot of the work myself. I'm a Chartered Engineer so I would develop the plans, materials and method statements with advice from my listed building consultant.

Green_hopeful

There is a facebook group with thousands of people who have similar properties. Its called Your old house UK - repair and conservation. They are really knowledgeable and many will have mortgages on listed houses that need work.