Mortgage for "almost finished" renovation project

[Rocksteadyeddie]

A friend of mine is going through a separation and needs to remortgage. She is partway through a significant renovation project. The structure is built and it is water-tight but it needs the interior fitting out. The property has been valued at £1 mio when it is complete by a local estate agent. She has a net monthly income of c£3000 and requires a mortgage of £320,000 to finish the project. At the moment she is asset rich and VERY cash poor so doesn't have money to throw at expensive mortgage advisers.

Would this qualify as a self-build mortgage, or would she be better looking out a "normal" mortgage. In either case does anyone have any experience of anyone that she could speak to for some decent advice?

Thanks in advance

[Steffan]

There are IFA's on Pistonheads. They should be your first call.

I doubt if your friend can get a mortgage for that sum (350,000+) on £3500 a month.

The multiplier is much too high at 9 times. Even grossing it up it seems unrealistic.

Although the loan to value looks good the project is not finished so there is a problem there. Self build might be a route.

As an alternative I suggest she seeks a business partner with high income funding on a joint basis.

On balance I think this is a seriously difficult mortgage to achieve. The rules and attitude of lenders now are so much more proscriptive.

Best of luck anyway.

[blindswelledrat]

Rocksteadyeddie said:

expensive mortgage advisers.

They dont cost anything? They get paid by the mortgage companies.
Send a PM to Scotal on here and I would be suprised if he couldn't sort something out on the circumstances described.

One thing I know from having a fking nightmare trying to get renovation mortgages is that they will not even consider final value. None of them. They will only lend against current value.
That said, presumably it has a value and you seem to imply that she is equity rich thus I would have thought it can be done.
The 9x figure mentioned above is far nearer to 5 times when grossed up so I would imagine that is quite feasible

[qureshia]

if she plans to sell once complete she may be able to tempt a private individual (angel investor) to stump up the monies in exchange for a slice of the upside or big interest rate.

PM if she wants to go down this route with details of timetable, location etc

[Rocksteadyeddie]

Thanks for the offer qureshia, and to others for their advice. She is keen to finish what she has started (this is the latest in a line of projects). Her current thinking is that she will live there and rent a couple of the rooms on the top floor to help cover some costs.

It doesn't feel like this is a totally undoable deal, she is just keen to avoid getting totally shafted along the way.

[Sarnie]

Before looking at the details of the property and whether the mortgage can be placed, I'd want clarification of her income e.g is she employed or self employed? As you have said "circa £3k" a month I'm assuming she is self employed or has income from various sources. If the income doesn't fit, then the mortgage is going nowhere irrespective of the stage the build is at.

[Rocksteadyeddie]

Sarnie said:

Before looking at the details of the property and whether the mortgage can be placed, I'd want clarification of her income e.g is she employed or self employed? As you have said "circa £3k" a month I'm assuming she is self employed or has income from various sources. If the income doesn't fit, then the mortgage is going nowhere irrespective of the stage the build is at.

Maintenance payments.

[Sarnie]

Rocksteadyeddie said:

Maintenance payments.

No chance then.

Some lenders will include maintainence payments in addition to earned income, but not as sole income.