Unmortgageable Property

Faye_ · 21 July 2018 at 8:14AM

Hi,

I wonder if anyone can help. Myself and my partner have applied from a mortgage on a property with Natwest. The property needs some work so my Dad (who is a builder) came out to assess the situation before we proceeded with the mortgage - no major issues.

The surveyor has advised - the property falls short of the lender’s core requirements, specifically the one of the property being in a reasonable state of repair. The property had no central heating or hot water, had significant damp issues, as well as a number of structural issues.

The property has no hot water or heating as the vendor turned the boiler off 8 years ago (I assume for cost purposes). We were aware of the other issues and had already made enquiries to resolve the concerns quickly.

Is there a way to get this mortgage pushed through as I am now concerned it will be rejected?

davidmcn · 21 July 2018 at 9:37AM

You'll need to clarify what you mean by "making enquiries to resolve the concerns". The lender will want the relevant problems to be fixed (and the property reinspected) before they proceed.

If the boiler is merely switched off that shouldn't be a problem, perhaps the surveyor was sceptical about everything working again when it's turned on after an 8 year slumber.

amnblog · 21 July 2018 at 9:39AM

This property is simply unmortgagable. Not suitable security for any standard mortgage lending.

Mortgage Lenders need security they can sell quickly and easily in the event of non payment. This is not such a property.

If you are in a position to take a bridging loan you can possibly borrow for six to twelve months to make the purchase and have Dad sort the property to make a standard mortgage an option.

Expect to have either 30% to 40% deposit, or a second property you can use as additional security.

csgohan4 · 21 July 2018 at 11:57AM

looks like the property is only for cash buyers as it's not mortageable and understandable

Amst · 21 July 2018 at 12:12PM

Your definition of habitable and the lenders will be different unfortunately. What they are looking for specifically is whether the property is saleable now, or in future (in the event of a repossession) and features such as poor central heating and structural/damp issues make it a less attractive proposition to lend against.

ACG · 21 July 2018 at 12:27PM

Habitable means in the middle of winter, would 90% of the population be happy to stay in that property - that is not a definition the lenders use, but it is a good way to look at it. The reality is you might be as you are looking at the bigger picture, but most people would not.

As mentioned above, you will need a bridging loan as the proeprty stands by the sounds of it. Once the bigger jobs (ie heating/water/damp) are sorted, you could potentially look to get the a "normal" mortgage.

I did something like you guys did a few years back. There were storage heaters and hot water and only one plug socket in the whole house that worked (that had black soot around it!). But the difference was that there was heating and hot water.

Unmortgageable Property

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