Please help: buying a house and completion certificate?

[Andyk78]

Hi all, this is my first post on the forum: here goes-:

Myself and partner are in the process of buying our first house, the property we are buying has been extended and has all relevant planning in place and granted but has not been finished internally and has been inspected recently upto pre plaster stage. We are aware of this and still wish to buy and complete the work. As such it does not have a completion certificate from BC.
We have the banks valuation and they all came back positive that the house is suitable for mortgage and our mortgage offer pack came out and we are over the moon!
However we have started the conveyancing process and for some reason I'm starting to get worried that when the conveyancing searches reveal that although planning is all good that the completion certificate has not been issued due to the incomplete nature of the house at present and this may cause the bank not to borrow or have it re inspected and slap a retention on it? Is my worrying unecessary? Or could I be right? Haven't heard anything untoward yet from solicitor but just wanted some reassurance that this won't be a problem? Can anyone offer any advice or maybe been through this kind of purchase before? Your help and advice would be appreciated from a very nervous first time buyer here.

 

[Andyk78]

Anyone?

 

[freddiemercurystwin]

Presumably the price reflects the current condition of the property? How do you know the works to date have been inspected?

 

[Andyk78]

Thanks for taking time to reply,

Yes the price does reflect the current condition of the property, and I know,the works to,date have been inspected and are ok as the seller arranged for a visit from the BCO to call round a few weeks back and inspect it and I have a letter from the BCO to conform this at the sellers request.

The house is habitable in that kitchen, bathroom and other rooms are untouched, just the extension has no electrics, and not boarded out and plastered and the boiler needs signing off. As I say the work has all the palnning approved and have copies of all this from the council and the inspection came back positive but until the listed things above are finished it remains on there records as uncompleted and I'm thinking although the survey still values it ok for what we are looking to pay it will come up on the local,searches by solicitors showing as uncomplete and would this fact cause a problem with the mortgage lenders? I.e retention or not suitable for mortgage?
I know this may be an unusual one as we aren't interested in the sellers getting the work completed as they won't due to them splitting up and they simply don't have the money to. We have a decent price and just want to complete the relevant work ourselves, just worried in this climate on home the bank will view the non completion certificate? Like I say the valuation confirmed the price was ok and they noted it as "several cosmetic finishes required" and ticked the box on there report which indicates suitable for mortgage. So far so good but just have a feeling this completion certificate is going to come back to bite me once searches are completed?

 

[freddiemercurystwin]

Surely you discussed this with the lender before you applied?

 

[Andyk78]

Yes I discussed this with the lender and they said it shouldnt be a problem as long as the house was habitable, although this was the lenders call centre staff and sometimes the advice you get from them varies and isn't always accurate!!
We went ahead regardless though and took a chance on it and we are upto now moving ahead without a hitch, but i just have the feeling this could be a problem? Then again I could be wrong like I was about the valuation as I thought there maybe a retention at that stage and there wasn't. Do you have any ideas on this? Am I right to think there could be a problem? I know this may be an unusal situation as most threads I have found on here relate to buying a house already completed and standing for several years without a completion certificate. But still I can't seem to find a resolve on any of the other threads and also this is different in that I cant use an indemnity policy or regulation or anything as the work has not yet been completed and the relevant planning is in place.....strange one for you in know haha, any views?

 

[freddiemercurystwin]

It may not crop up that often but its not so uncommon, plenty of houses with half built extensions or whatever are sold where couples split or funds have dried up or whatever.

All mortgage companies vary with how stringent they are (or aren't) and what they will or won't lend on. Did you go through an adviser or get this mortgage off your own back? If an adviser he should have sold you a suitable mortgage that allowed such purchases to proceed, If you've done it yourself then you'll have to hope the call centre knew their stuff. There's not much you can do now anyway.

If the house was valued and the lender was happy with the valuation (which they obviously are) then there's no more risk than with a finished house.

 

[Andyk78]

Ok so it's sounds like a 50/50 chance then, gutted if we don't get it as invested a lot of time into getting prices for the work to be finished etc and we really want this place bad! If anyone else has been through same or similar situation I would love to hear how things ended up and if anything what options could be considered to get around this if anything at all.
We did have a personal mortgage advisor but ended up sacking him haha! He took to long doing anything so went direct and things have moved much faster but like you say maybe could have discussed mortgage options for this kind of purchase, although with only a smallish deposit our options are limited anyway and dictated by the best fixed term and apr % deal we could get.

 

[Robotmannick]

Andy,

I think you're worrying yourself too much over this. Freddy has this one covered. Your lender has sent someone to value the house who has noted that the extension is not complete and they've accepted this and still chosen to lend you the money. It's really not such a big deal - the property still has a value, albeit slightly lower than it would be if it was finished. The valuation report will reflect this (as I'm sure will the price you're paying). The mortgage company will not be expecting a completion certificate.

If you're really looking for something to worry about, think of the stress on moving day

Nick

 

[freddiemercurystwin]

Ok so it's sounds like a 50/50 chance then

Well you stated on the form the works were incomplete presumably, and you've had your mortgage offer anyway.

 

[Andyk78]

Thanks for your comments Nick, I hope that's all we do have to worry about.

With regards to mortgage forms the complete or incomplete state of the house was not a question. We already had the mortgage offer in place from a property before this that we pulled out of for various reasons. So all we had to do once found this one is call the lender and give them the new address and year approx built and then arrange the valuation and that was it? I did mention this to the lender when they asked if there was any additional information about the house for the survey and said it has an extension with works that needs completing inside so hope that's enough. It's just more now if they ask for the certificate as the surveyor works on the assumption that all building consents and planning have been sorted when sending his report for price. And advises the solicitors to check this is true based on his assumptions, that's the bit that is worrying me is this could be subject change. Hope to god I'm wrong on all this.

 

[Andyk78]

The funny thing is I can't seem to easily find a straight answer on this as when called bank to ask I seem to get the answer of it might be ok or it might not! Surely this should be written somewhere for the lending criteria? Or is it just down to the discretion of the underwriter?

 

[freddiemercurystwin]

So did you get a valuation or a survey? A valuation will do no more than value the property as it stands.

Mortgages lenders are a funny breed, they all have different criteria by which to judge a loan, generally the better the rate the more stringent they are, IMO its often best to use a decent FA if there is anything at all unusual or awkward, if they’re old timers they get a feel for which mortgage lender will be most suitable but that’s a moot point now.

 

[Andyk78]

Thanks Freddy, yes just a valuation as we just wanted that which you have stated, a value of the property as it currently stands today.
It's just a shame that we can't seem to find out today if we will be ok to get it as it sounds more like a decision will be made once the underwriter get all the facts and decided what he or she wants to do! Although we have had the survey saying its worth what it's worth in its uncompletes nature as it stands, just hope the bank are not awkward when it comes down to a piece of paper for the completion certificate as we have the money ready to finish all the work immediately.....

 

[Lower]

You're flapping over nothing.

The banks don't care about completion certificates etc. All they are concerned about is if the house is worth what you say it is so that if you don't pay them the mortgage back they can repossess the house and sell it to get their money back.

As long as the valuation report goes to the bank saying that the house is worth what you've told them it is you'll be fine.