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  • FIRST POST
    • Skinnymum24
    • By Skinnymum24 11th Oct 18, 10:39 PM
    • 8Posts
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    Skinnymum24
    Full Mortgage Retention
    • #1
    • 11th Oct 18, 10:39 PM
    Full Mortgage Retention 11th Oct 18 at 10:39 PM
    Hi,

    Applied for mortgage, all paperwork in, back and forth etc, valuation was booked for Monday.
    Received valuation report today with the following;
    "We recommend a full retention from the advance pending satisfactory Structural Engineer Report."
    The Surveyor seemed to have noticed structural movement on the flank wall (end of terrace house) and cannot confirm that it is not progressive. He wants a Structural Engineer Report to confirm all this and whether any works need to be carried out.
    After googling this it appears that most houses in the area have some kind of structural movement... is this something to be worried about?
    Furthermore, shouldn't the retention be for the amount it will cost to fix this rather than a full mortgage retention?
    If the Engineer confirms it's non progressive, will they take his word for it??
Page 1
    • minimike2
    • By minimike2 11th Oct 18, 10:46 PM
    • 2,040 Posts
    • 1,536 Thanks
    minimike2
    • #2
    • 11th Oct 18, 10:46 PM
    • #2
    • 11th Oct 18, 10:46 PM
    You are about to spend a large amount of money on something which could be at risk of essentially falling down.

    Do you think it is something to be worried about?

    The question kind of answers itself.

    The whole point of the structural report is to confirm if there is an ongoing problem or not. There would be no reason to disbelieve what the report will state.

    A full retention is being recommended as if the problem is a risk to the property then it is not mortgageable, so if the work were not to be done the lender will have security worth £0. It's a funny way of doing it as it isn't really a retention, its a £nil valuation pending further investigation. Retention is usually when the property is deemed suitable but some works are needed. In your instance the lender is just not going to get to offer without knowing the extent of the problems with the property.
    • butterflybook
    • By butterflybook 12th Oct 18, 8:49 AM
    • 115 Posts
    • 35 Thanks
    butterflybook
    • #3
    • 12th Oct 18, 8:49 AM
    • #3
    • 12th Oct 18, 8:49 AM
    The Lender will want to protect the money they are lending and of-course i am sure you would not want to purchase a property without knowing if something like this could potentially cost thousands of pounds in the future for you.

    This isn't always a major drama, once the structural engineer has completed the report, if he deems that the property has had historic movement but this is not progressive in all likely hood the mortgage company will lift the retention and all will be well and if the outcome is anything other than this then it may be worth considering if purchasing the house is the right thing to do.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • ACG
    • By ACG 12th Oct 18, 8:51 AM
    • 17,949 Posts
    • 9,733 Thanks
    ACG
    • #4
    • 12th Oct 18, 8:51 AM
    • #4
    • 12th Oct 18, 8:51 AM
    The full retention is in place because of how major it is/could be. The house theoretically could fall down or need underpinning.

    You will need to get the report and see what it says. If it says work is needed, then it will need to be done before completion can take place.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • amnblog
    • By amnblog 12th Oct 18, 10:46 AM
    • 10,840 Posts
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    amnblog
    • #5
    • 12th Oct 18, 10:46 AM
    • #5
    • 12th Oct 18, 10:46 AM
    You are being saved here, from your own eagerness to secure the property.

    If, in the structural engineers opinion, there is no problem, the Lender is clear to lend, and you are safe to buy.

    If, in the structural engineers opinion, there is a problem which can be fixed, and it is fixed, the Lender is clear to lend, and you are safe to buy.

    If, in the structural engineers opinion, there is a major problem with the property, the Lender will walk away and so should you.
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • wantonnoodle
    • By wantonnoodle 12th Oct 18, 2:56 PM
    • 263 Posts
    • 175 Thanks
    wantonnoodle
    • #6
    • 12th Oct 18, 2:56 PM
    • #6
    • 12th Oct 18, 2:56 PM
    We had a similar retention when we bought our house 18 months ago. In the end, the additional surveys they required highlighted the need for new cavity wall ties and some replacement lintels over a few of the windows. They reduced the retention to £5000 on receipt of these surveys.

    As we couldn't afford to proceed with the retention in place, we put an ultimatum to the vendor - either they get the works done to the lender's satisfaction (with completion certificates) and we proceed at the agreed price, or we walk away.

    Thankfully, the vendor saw sense and realised that this would likely be a requirement for anyone looking to buy with a mortgage (the house had already been reduced twice before our offer was accepted), and so arranged and paid for the work to be completed. This was done, and the lender accepted the certificates of completion of works and lifted all retentions.

    We then proceeded with the rest of the sale (searches etc) without any hiccups. All in all, the additional reports cost us £375 for the structural survey and £120 for the wall tie inspection, so in the grand scheme of things, it was a fair price to pay to be able to get what we wanted.
    • Skinnymum24
    • By Skinnymum24 13th Oct 18, 8:16 PM
    • 8 Posts
    • 0 Thanks
    Skinnymum24
    • #7
    • 13th Oct 18, 8:16 PM
    • #7
    • 13th Oct 18, 8:16 PM
    Thanks for your advice.
    If any works are needed, will the bank require this fixed before they make an offer or will they lend with a retention for the amount needed to fix anything?
    • ACG
    • By ACG 13th Oct 18, 8:29 PM
    • 17,949 Posts
    • 9,733 Thanks
    ACG
    • #8
    • 13th Oct 18, 8:29 PM
    • #8
    • 13th Oct 18, 8:29 PM
    It depends on the work and what the surveyor says.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • dunstonh
    • By dunstonh 13th Oct 18, 8:49 PM
    • 96,058 Posts
    • 63,875 Thanks
    dunstonh
    • #9
    • 13th Oct 18, 8:49 PM
    • #9
    • 13th Oct 18, 8:49 PM
    If it makes you feel any better, I got my offer letter through the other week and that has a 100% retention on it pending a structural engineers report.

    The valuer said that he identified cracks and believed they could be progressive. The structural survey was completed and it was nothing of the sort.

    The survey highlighted a couple of things that the valuer didnt see and the vendor is putting everything mentioned in the survey right (which in the end was minor maintenance stuff but costing about £10,000) and the lender is happy with the survey and the copies of the work done. It has delayed the moving dates but it has got a bunch of maintenance jobs done at the cost of the vendor and not us paying for them.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
    • Skinnymum24
    • By Skinnymum24 15th Oct 18, 3:38 PM
    • 8 Posts
    • 0 Thanks
    Skinnymum24
    Thanks for your replies.
    [QUOTE]and the lender is happy with the survey and the copies of the work done/QUOTE]
    Did the lender insist the works are done before Completion?
    We have completely run out of time, hoping that all they require is retention. ...
    • wantonnoodle
    • By wantonnoodle 15th Oct 18, 4:18 PM
    • 263 Posts
    • 175 Thanks
    wantonnoodle
    Did the lender insist the works are done before Completion?
    Originally posted by Skinnymum24
    In our case, no, they didn't. But we would have had a £5000 shortfall in the money they would lend, so we couldn't afford to go ahead in that situation. Bear in mind that we would have had to find the extra £5000 out of our own pocket to pay the vendor, plus on top of that we would have had to pay for the works, which would have cost £4000. If we'd scraped it together, it would have wiped out our budget for decorating, furniture etc.

    Thankfully, our vendor agreed to complete the work to the lender's satisfaction so that the retention was lifted and we were able to proceed.
    Last edited by wantonnoodle; 15-10-2018 at 4:21 PM.
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