Author Topic: Problems with funding (Read 1648 times)

FHayes23 · « **on:** October 04, 2018, 12:08:24 pm »

Hi Everyone. I am looking to buy a small place with around 8 acres and some outbuildings. We have found the perfect place but has anyone come up against problems with financing as we are being told this is a commercial property and not a residential one, meaning that we would have to find about 50% of the funding ourselves. The property has a house as well as sheds etc. We do have equity to put down on the property but not as much as 50%!! Has anyone else come across this problem? It seems to be a very gray area in purchasing and |I am beginning to despair at the system we are having to fight with this. Thanks Fiona

doganjo · « **Reply #1 on:** October 08, 2018, 08:00:42 pm »

Is the house habitable? Have you had a full survey done on it? We bought a cottage some years ago that needed complete renovatio, with 24 acres, which was habitable, so we were able to get a mortgage on it. We were both working at the time.

ZacB · « **Reply #2 on:** October 09, 2018, 07:03:46 am »

I think Santander stipulate in excess of 10 acres classed as commercial so it may be worth asking around different lenders.
Otherwise, purchase the house and land by separate transactions.

bj_cardiff · « **Reply #3 on:** October 09, 2018, 08:49:57 am »

I'd speak to the selling agent and explain your problem, they have probably encountered this before

Womble · « **Reply #4 on:** October 09, 2018, 10:28:05 pm »

Quote from: ZacB on October 09, 2018, 07:03:46 am

Otherwise, purchase the house and land by separate transactions.

^ Yes, that! Although you would presumably then need a residential mortgage AND a commercial one, unless you already have a pretty serious deposit?

Incidentally, when we bought our house with 5 acres and some outbuildings, we just got a standard residential mortgage and nothing special was said about that. However, in the legals, there was a line which said "the value of the house and outbuildings is taken as X, and the value of the fields is taken as Y". This means that if we ever sell, we would be liable for capital gains tax on the new value of "Y", if that makes sense, because it is not part of our primary dwelling.

Does that help?