A property with challenges - yes or no?

THE QUESTION

I have found a property I want to get a buy to let mortgage for, but I have a bad credit rating.  The house also has no kitchen, are there any lenders that would be able to provide a mortgage for this?

THE ANSWER

Take a reality check on this one, you have zero chance of getting a mortgage on this property as a means of buying it.

Leaving aside your credit history, a property has to be lettable on day one to get a mortgage; if it has no kitchen, it plainly isn’t that. So it is a non-starter in the way you want to purchase it.

For a property to be mortgageable:

• As a main residence - it has to be habitable
• As a BTL it has to be lettable and that is different to habitable. It means, in the lenders' surveyor's opinion, a tenant would want to pay good money to rent it on day one

Fitting a kitchen between exchange and completion might work, but if the rest of the property is not in good repair, it is still unmortgageable.  It's very unusual to find a pristine property that just happens to have no kitchen!

If you're set on buying the property your options are:

a) cash, yours or someone else's

b) bridging finance

The plus side is that an unmortgageable property can only be bought by cash buyers (include bridging in that) and cash buyers never pay top dollar. So, if you can complete in less than 4 weeks using a) or b), you may still be able to buy the property and make an outrageous offer as a 'cash' buyer.

Moving on to getting a mortgage with 'bad credit'. That description is way too generic to know what your chances of getting a mortgage are. A bankrupt has bad credit, but so does someone who missed a payment on their credit card. A mortgage broker can advise, but they will need to see your credit file first to see just how bad, bad is.

Maybe you can get a mortgage, maybe you can't. The thing is to focus on what you CAN do, not what you want to do, but can't.

If it turns out you can't get a mortgage, don't give up, you can still buy property because bridgers lend to people with bad credit. Just buy and sell then bank the cash profit. There are variations like mortgage hosts, but if you want to keep it simple; buy and sell. Either refurb it, then sell or sell it to let someone else refurb it. Buy and sell as many deals as you can find until you've built up a profit and improved your credit rating.

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