I have mortgage approved in principal- and now have sale agreed on a house. Valuer valued it at exact offer I had made and suggested due to age of property that engineers report be submitted also. There is alot of cosmetic/modernisation work to be done on the house- but nothing seriously structurally wrong- and there is huge potential to extend and house is habitable- as per valuer and engineer's report. I'm just afraid now that bank will not lend me the money as they are gone so strict now- I am only looking for what I have offered- and not for money to improve. I have some savings (enough for a new kitchen and probably some more). Bank is asking questions on work needed to be done, how much and where funds are coming from... Has anyone had any recent experiences of this with the banks?
Bank asking questions on repairs needed and funds required
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LDFerguson
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If the bank feels that you need to spend additional money on the house, they will ask you to show how much and where the funds are coming from. They don't want to offer someone a mortgage based on their current financial circumstances in the knowledge that the customer will need to take out a separate loan to fund improvements, which could affect their overall ability to repay.
Bubbly Scot
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Not exactly recent but two years ago our bank pulled out some things from the structural survey and asked questions about it. Off the top of my head there was mention of a window, two sets of stairs that didn't meet planning legislation and some damp in a wall.
We got a couple of quotes for the damp, put a letter in outlining our plans for the stairs and window, stating they would be adressed as funds and time allowed. Two hours later the decision came back, yes.
I appreciate that in the current climate it might not be as easy.
We got a couple of quotes for the damp, put a letter in outlining our plans for the stairs and window, stating they would be adressed as funds and time allowed. Two hours later the decision came back, yes.
I appreciate that in the current climate it might not be as easy.
LDFerguson
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That's a slightly different issue from the original post. The property is the bank's security so they need to know that they could sell it without difficulty if you default. Any planning issues need to be sorted before they'll let you proceed. On the damp, they need to be sure that their security isn't about to fall down.
Liam D. Ferguson
Bubbly Scot
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That's a slightly different issue from the original post. The property is the bank's security so they need to know that they could sell it without difficulty if you default. Any planning issues need to be sorted before they'll let you proceed. On the damp, they need to be sure that their security isn't about to fall down.
Liam D. Ferguson
That's what I understood from the OPs post which is why I gave the answer I did.
Perhaps I should have stressed in my post that my banks questions were the same as the OPs and also because of the age of the house but I didn't feel it neccessary.
thanks for your responses- there's nothing major wrong like structurally, roof, floor, damp, wiring or heating- all big stuff is fine- it's just generally, the decor is poor and it will need a complete new kitchen- im just wondering how detailed the costings will need to be for the bank- fingers crossed for me! It has huge potential to extend etc. so hopefully all that will work in my favour. I just can't bear the waiting game!