Should we just pull out?

[monpetitlapin]

God I feel awful even considering it.

The flat we offered on has come back as unmortgageable with the only lender that will lend us enough to actually buy the property. We can potentially try other lenders but none of them will lend us the full amount based on what the advisor (whole of market) showed us before we decided to go ahead with this one.

The property is apparently unmortgageable because the communal parts of the block of flats haven't been maintained very well. I did notice some of this but didn't realise how bad it was. There is a lot of wear and tear to other parts of the building and the parking area is in a very bad state as well, and none of it seems to be managed by the management company. There are also quite a few tiles missing from the roof which I didn't see until I went back today and scrutinised it all. The exterior is shabby.

This seems to me to be a compelling reason to pull out as I don't want to deal with huge maintenance bills if the management company ever sort these issues, or with the disruption caused by the problems that could arise from these issues. We only ever planned to have this property for 2-3 years at most, as a stepping stone to move to somewhere better for our very young children. This one doesn't have enough bedrooms for long term, or a garden.

We are currently renting. Our rental cost is the same as the mortgage would be, but we are getting a 2 bedroom semi with a garden, garage and drive in the same town, and while it's money down a hole, it's a nice hole to be stuck in. The flat is also 2 bed and has bigger bedrooms than the house we rent though.

Also relevant is I'm on the up in my career, close to moving into management, and my salary in 2-3 years time might well be double what I'm on right now.

I feel like we'd be better staying where we are for a bit longer rather than trying to find any one mortgage offer that won't even cover the full amount we need, then trying to renegotiate the sale price (which also seems shitty to the seller).

If we go ahead, I'm worried that we're going to get stuck in a 2 bed flat with a boy and a girl if it's hard for us to sell it, because our potential buyer wouldn't necessarily get a mortgage either. But if we pull out we're going to have to either buy another flat somewhere nearby or move out of area completely to another town.

WWYD?

Count yourself lucky then! It took an expensive survey for us to find out that a house was uninsurable....run away....

Of course the EA is urging you to get another mortgage. Remember, they don’t work for you or your best interests - they work for the seller.

I would walk. It sounds like this property will be a millstone around your neck.

Yes walk away and ignore the estate agent. There will be something better round the corner - bide your time.

@monpetitlapin I am another one who is going to advise you to pull out of this deal. I know it feels bad as I have pulled out of a house purchase myself in the past and you feel sorry for the Seller. But at the end of the day, it's a business deal. You can't spend £100,000s on a deal you know you no longer want. All the reservations you are having now is why this flat would be a pain in the arse to sell further down the line.

You have good reasons to stay put for now and consider moving out of your rental when you have advanced a bit more in your career and hopefully interest rates will be a bit lower by the end of 2024 & 2025 which will help with affordability.

Don't listen to the EA arguments. They work for the Seller not the Buyer and put simply, they are not your friend. Just make the phonecall (or send the email) and get it done, pull out and breathe a sigh of relief.

Run Away, plenty more flats to buy.

Pull out. We have a rental flat that we can’t sell due to cladding and it’s been that way for 4 years now. It’s frustrating for us as we want the equity to move up ourselves but it’s even worse for owner occupiers who want to move out but are now forced to become landlords because the flats are unmortgageable. They’re also faced with extra stamp duty when buying their next property as they already own one. And this is in a modern and well maintained block.

Don’t feel any guilt towards the EA. They know it has problems and are pushing you to buy anyway as they know the next buyer will face the same problem if they need a mortgage. It’s rubbish for the sellers of course but it sounds like you’re right at the start of the process so better now than later. They may have to market it to cash buyers or go down the auction route but there will be a solution for them.

I don't know how this is even a question? If you can only get one lender to offer the amount you need and they say the flat is unmortgageable then you have no choice! I presume you haven't reached the stage of seeing the accounts for the block of flats - there should be a sinking fund to cover these types of maintenance costs and the fact that the works are not being carried out suggests that either the service charge is way too low, the managing agents are incompetent or a combination of both. Low-level neglect will turn into major problems down the line and you may well find yourselves contributing thousands in charges when the roof needs replacing or some non-negotiable H&S works have to be carried out.

Exactly, the lending isnt there, how else can you buy it? Does the OP have the cash to buy it? Just tell the seller it cant be mortgaged and move on, let them find a cash buyer.