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Mortgage on uninhabitable property

Written By:
Myles Robinson - Expert Finance Advisor

Posted: Feb 6, 2023

Mortgage on an uninhabitable property

Are you thinking about buying an uninhabitable home?

Many people might wonder, “Why?” It is the same question that lenders ask. However, you may have the vision to restore an old home to its former glory. The old saying goes: “Location, location, Location.”

You have two options if you want a mortgage for an uninhabitable home. Many lenders won’t approve mortgage applications if the property isn’t up to standard or unlivable. This can lead to work being done pre-purchase or money being retained and both of these things can ruin a creditworthy investment.

Many options are available, so it is worth speaking with one of our expert property advisors to get the best advice.

Click the link below. We provide mortgage advice free of charge with our mortgage brokers. We have a few mortgage providers lending specialist finances for an uninhabitable property.

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What makes a home uninhabitable?

A lender may consider a property uninhabitable if they see a variety of factors. While most of these factors are fairly common, some might seem odd. These are:

  • No bathroom or kitchen (or multiples, possibly signalling a commercial setup).
  • If the property isn’t wind- and waterproof.
  • Health risks could be caused by significant dampness or mould issues
  • Handrails are not required for stairways that do not comply with building regulations
  • If the property is not secure,
  • Roofs that are not standard
  • It has contaminated outside areas, such as Japanese Knotweed or houses near a mine shaft.
  • Asbestos is the real bogeyman.

Some lenders might refuse to give a valuation if the property is not considered habitable.

Even if the property appears habitable, a valuer might decide it is not. The lender may conditionally approve a mortgage conditional upon repairs. Once all the necessary building work is completed, it should be eligible for a mortgage.

If you don’t know how to do it, a mortgage on an uninhabitable or derelict house is unlikely to be feasible. Fortunately, the advisors who work with us understand.

What happens if there is Japanese knotweed on the property?

Every lender will require a professional mortgage survey to evaluate the property and the knotweed. They will also assess the property risk from the lender’s perspective.

Each lender will then determine suitability based upon their lender criteria policy for Japanese Knotweed Mortgages. You’ll discover that some lenders are more flexible than others.

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Is it necessary for the house to have a functioning kitchen and bathroom?

The answer is a resounding ‘yes’. Although chances of getting a mortgage for a primary residential or buy-to-let property with no bathroom or kitchen in the UK are slim, that doesn’t mean lenders won’t be willing to consider a property without them.

Residential and buy-to-let lenders will require that the property has a functional kitchen and bathroom. This reduces your options for lenders and limits the number of specialists available to you.

Strangely, a mortgage that includes two kitchens in a home can be equally tricky because lenders might consider the property a house in multiple occupancies (HMO).

There are, however, ways to avoid this. We will discuss these in the article. The right advice can make all the difference in whether you buy the property or not.

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Is the property weatherproof?

If you want a mortgage on an uninhabitable property, then “yes” is the answer. To get a mortgage, the building must be weatherproof, self-contained, and secure.

Lenders can refuse mortgage applications if there is any chance of roof damage.

A second consideration is the possibility of getting insurance for such a property. This is because adequate building insurance is mandatory for all mortgage lenders. This can lead to excessively high premiums or even a borrower can only buy the property in cash if it is impossible to insure.

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Is central heating required for the property?

It depends on how the property is maintained. Most mortgage lenders sometimes consider the mortgage application if the property has no central heating. However, this depends on what the surveyor says about the property. This category may apply to some listed buildings.

What about an uninhabitable listed building?

Getting a mortgage for an uninhabitable property in the UK is not easy.

Specialist restorations are required for listed buildings. This includes original style materials, building techniques, highly skilled tradespeople, and artificers. All of these can be pretty expensive and impact mortgages for listed buildings.

It’s possible to restore a listed building to its original glory. Talk to our expert advisors if you believe the final result will be worthwhile. Mortgage brokers specialising in this field will know the best lenders for your project and can help you find a mortgage on an uninhabitable property.

Can I get a mortgage for a property with asbestos?

Many people consider asbestos a severe health concern. Asbestos can also be a problem when applying for mortgage approval. It can usually be treated and removed if it is an extreme health concern.

Is it necessary to remove the asbestos?

Lenders will require an asbestos report from experts, UKATA or UKAS surveyors. They may accept it provided the asbestos has not been damaged, and the property does not have load-bearing asbestos panels.

An asbestos-containing mortgage valuation can be complicated. Some lenders may require the asbestos removed before approving a mortgage. However, the surveyor’s comments may be considered by the lender to determine any remedial work required.

What about an asbestos roof?

As long as the roof remains intact and in good condition, a residential mortgage for a house with an asbestos roof will not be a problem. However, always get expert advice.

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What will my chances of getting a mortgage depend on the type of roof?

Mortgages not available for buildings with a standard roof may prove more challenging to obtain. Lenders prefer slate roofs or tile roofs but might have problems with other roof types. These include:

  • Flat Roofs –

    As long as the roof is not entirely flat, a mortgage can be granted on flat roof property. Depending on the materials used and the flat roof area, Lenders may consider them. Flat-roofed blocks of flats are the exception to this rule.

  • Felt Roofs –

    Lenders may be willing to mortgage a home with a felt roof if the mineralised felt was part of the original construction and not added later. Many homes have felt roofs or at least a portion of them.

  • Thatched Roofs –

    The classic English cottage is timeless in its beauty, but it also has its problems. Lenders will approve a thatched roof mortgage as long as they are satisfied with the valuation. However, there are some caveats. You must have full property insurance and keep the roof maintenance and replacement program current.

  • Tin Roofs

    Before granting a mortgage to a house with a tin roof, lenders will consider various factors. Lenders will view the comments of the valuer on the day, future potential and whether there are other properties with similar roof construction in the area. Generally, the less common a feature for an area is, the better. It is essential to assess the overall condition of your property.

What will solar panels do to a mortgage?

It all depends on who the owner is. A mortgage with solar panels can be obtained, provided they are paid off and not rented or leased to the energy provider. They must be yours and not leased to anyone.

It is also a matter of who is responsible for maintaining the roof and the attached solar panels.

However, some lenders will consider solar panels as a mortgage option. We recommend contacting us by clicking the link below to obtain expert advice. We will talk you through the UK regulatory regime for mortgage approval.

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A mortgage valuation after essential repairs

Some lenders may ask you to rectify your mortgage and then make repairs to ensure it is satisfactory.

If you already own the property and want to refinance it to pay the costs of the work, a secured mortgage or bridging loans might be your only option.

There are two options if you’re looking to purchase an uninhabitable home and the lender declined your mortgage because of its current condition. You can request repairs before they are complete.

  1. Send the paperwork to the estate agent or vendor and ask them to complete it.
  2. You can pay for the work before the sale or agree to lower the purchase price to cover the repair cost. This is where the catch-22 lies. You may need to spend money, possibly quite a bit, on a property you do not yet own. Also, approval will be subject to a surveyor’s assessment.


A few lenders will only approve mortgages but not release all funds. This is mortgage retention. The remaining money will be removed once the surveyor/valuer has completed the building work.

Is bridging finance an option?

Absolutely. An option is to use bridging loans to purchase an uninhabitable home. For instance, bridging loans are often used to help finance mortgages for barn conversions.

Bridging lenders may have a greater appetite for risk and will consider the viability of the entire project. Is it possible that the property would be worth more if it had been paid for? This could help to cover the cost of the loan. This allows the borrower to end the bridging financing deal within the agreed timeframe (6-12 months). The lenders will then be more open to negotiating agreements to finish the work.

Buy uninhabitable property at an auction.

Auctions are a popular place to buy abandoned or uninhabitable properties. Bridging finance may be an option.

Auction properties require payment in full for the winning bid within 28 days. This is much less than a typical mortgage application. A bridging loan can be approved within a week, depending on your credit score.

If you buy at auction, you may be able to borrow sufficient money to purchase the property and complete the renovations. Otherwise known as a renovation mortgage or fixed upper mortgage.

After they have reached an acceptable standard, you may approach a conventional mortgage provider.

You should have an exit strategy for your bridging financing. Once the property has been renovated, you will need to decide if you want to rent it out, live in it or sell it.

Talk to one of our mortgage advisors, and they will be able to point you in the right direction about bridging financing and how to convert it later to a standard loan.

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Can I get a second mortgage with a second charge to purchase an uninhabitable home?

This is the short answer. For many, it may be an attractive option.

This type of loan is also known as a secured, homeowner’s, or a second mortgage. It offers a way to free up equity from an existing property.

A second charge mortgage is a loan secured against your equity, effectively giving you two mortgages.

Depending on your financial situation and equity, you may be able to finance the purchase of the property. After the property is up-to-standard, you might consider remortgaging it and remortgaging as a buy-to-let or moving into it.

Talk to a mortgage expert for uninhabitable properties

Click the link below to begin your journey by speaking with an online mortgage advisor.

We will do the stressful work for you and help you reach your mortgage goals.

Contact us today to get specialist advice about homes that are currently uninhabitable.

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