lenders have now refused to lend - what next?!

[arudolf]

we were meant to complete before christmas, but the vendors had lost a piece of paper documenting the internal walls rebuild (or something like that), so our lenders have now cancelled our mortgage application. the solictor (and us) only found this out late yesterday, so we're waiting to hear what the vendors will do (they could get an independent assessor in to certify the walls for lending purposes, but this will apparently cost a fortune). I'm asking here so I have some idea of what the next stage is before speaking to our solicitor again.

We really would love this house to be our home, but cannot buy if there is any problem securing a mortgage (it would probably scupper any plans to resell in the future, amongst other problems). We've paid so much for surveys, electircal surveys, plumbing surveys, etc etc, it would be bloody infuriating to lose the property. Plus which, I love the place, and it's perfect for us. Absolutely perfect.

so the way we see it is this:

1. we do nothing, pay up solicitor and mortgage fees, and start saving then try and get somewhere else in a few months time

or 2. we shop around for another mortgage, and potentially waste cash on more morgage application fees, but also potentially get the house - however, we may not be able to re-sell in 10-15 years time if we want to.

Does anyone have experience of this sort of thing? will our credit rating be kippered by this? it's the property, not us, which has caused the mortgage to not be lent. what is the best wine to help us through the stress this has caused?!

Depends how much the vendors want to sell. You could deduct the cost of the new assessment from the offer you made and pay for it yourselves.

Do you think they did the internal rebuild properly or are making excuses about shoddy renovations that were never professionally guaranteed?

don't think they did it - I think it was done ages ago maybe with the owners before the owners before the one's we're wanting to buy from. that's a good idea about the cost of the assessment. I think they are keen to sell, they have another place lined up (although made it very clear when we were viewing/making an offer that they weren't in a chain, grr).

we'll see what the solicitor recommends us doing anyway, but DH and I are so new to all this, I thought I'd see what other people have experienced!! grr, so frustrating!

I don't think it is such a big deal in terms of having it checked over - presumably they knocked down some structural walls and rearranged the layout. My understanding is that if this was done before building control regs were commonly used, you can buy indemnity insurance against the work (if it was three owners ago, it would have happened some time ago so any problems would have come to light) or you can get a structural engineer to give an opinion (although this may mean drilling into walls or exposing supports which will obviously cause a bit of disturbance).

Bit that the mortgage was withdrawn before you had a chance to do this.

hi, OP here - yes, we're a bit shocked at the mortgage thing too. plus they have charged us for building and contents insurance on the same day they withdrew the mortgage offer! tits! DH is suspecting some ulterior motive, especially since it's taken them 2 weeks to inform us/the solicitors that they've cancelled the offer.

the property was a local authority build in the 50s, and all houses in this style had to be 'rebuilt' as they were concrete initially - it is totally standard for the bank not to lend on this type of build if there isn't evidence that the rebuild was done by legitimate, registered, builders. So we're a bit about why the vendors don't have this paperwork from when they bought the property, although it was ~5 years ago, when mortgages were apparently being given away to anyone!

will see what happens.

Would the local authority have paperwork since they were the freeholders?

nope, they destroyed all paperwork apparently

we're buggered, aren't we...

Not really- investigate building regs indemnity insurance option. I would have thought it was up to your vendor to do try and get this sorted though.

we've just heard it's all off, the bank absolutely refuse to lend on this property without the original paperwork, so we're out. :( not the best start to 2011.

the local authority have no paperwork but are willing to say that to the best of their knowledge the property was rebuilt by registered folk. Useful. Oh well, we won't be looking at this type of build again when we start looking for a new place to disappoint us. :(

Surely the vendors will be keen to sort this out? If they don't sell to you, they will need to sort it out before they sell to anyone else in the future. I agree with lalalonglegs, you should be able to get indemnity insurance. Good luck!

we'll ask our solicitor and bank about indemnity insurance, but we're not holding out too much hope - DH gets the feeling that the bank were looking for reasons not to lend, I don't get any feeling other than one of despair!! we'll talk to the solicitor later and ask the estate agents what the vendors plan to do. thanks so much for the advice :)