Renovation mortgages, advice please!

[firsttimer12345]

We are looking to buy a house (currently office) which is about £100k under what we could afford for a total mortgage but needs £80-100k of work doing. We've had a couple of advisors/brokers look into it and come back with nothing so far.

Feeling a little deflated as if we were to buy a house for the total cost, current house worth + renovation, we wouldn't be having issues.

Does anyone have any experience of this?

Surely you just need to find the £80-100K out of savings or loans, and when it's all done you remortgage against the house price increase and pay off the loans ? That's what everyone i know does...

There is such a thing as a renovation mortgage, that can lend you renovation funds in chunks taking into account the final value of the property after works. But rates tend to be much higher IMO. See Saffron BS for example, but you'll need a whole of market broker.

@didireallysaythat thats exactly what we thought but they've come back today and said that we can't get a normal residential mortgage as it's not technically habitable as it doesn't have a working bathroom/kitchen.

I think we'd have the same problem with a renovation mortgage now DH has come back and said about residential @EssentialHummus. I'd spent all afternoon google-ing.

The saffron website looks really useful, thanks. The advisor today has said the only way might be to get a commercial mortgage and then convert to a residential after the renovations.

Ah. The no kitchen is a hiccup.. sorry i don't have suggestions for that. I think mortgage companies have been tighter on this recently.

Does the office have a staff coffee area and sink that could loosely be described as a kitchen?

I think it might actually be the lack of shower that's the issue. They are greedy and have 2 kitchens complete with fridge/microwave.

There is, however, a urinal! Surely that could be classed as a foot shower

In this precictament although technically when we bought it it had a kitchen & a bathroom - although they were not usable IMO. This let us get a normal residential mortgage.

We had £ which we thought would cover the work but groundworks plus typical renovation surprises meant it ran out. However because at this stage we had no bathroom or kitchen the banks only option to us was to move the mortgage to a self build which would have been costly as we bought on a fixed rate.

So we have instead maxed out credit cards & borrowed from banks of Mum&dads.

Once we get completed building certificate we can then go to bank with copies of receipts, invoices etc to release equity to pay off credit cards & patents.

I don't recommend it, been ridiculously stressful & stupidly long.

Does the property have permission to be converted back to residential? I'd check that first before going any further....

We've managed to chat to a company called the build store today and they seem to be one of very few offering mortgages for this sort of thing.

They've had permission in the last few years to change to residential so we have made an offer dependant on this being granted.