What Makes a House Unmortgageable?

Old dilapidated weatherbeaten house that needs to be renovated housing problem

Buying a home is an exciting and significant milestone in anyone’s life. For most, securing a mortgage is an essential step towards making that dream a reality. However, there are instances where a property may be deemed “unmortgageable.”

In this article, we will delve into what it means for a property to be considered unmortgageable, and provide guidance on what to do if you find yourself in such a situation. But first, let’s understand what it means when a house is deemed unmortgageable!

What Does Unmortgageable Mean?

When a property is labelled as “unmortgageable,” it means that traditional lenders are reluctant to provide a mortgage on that particular property. This could be due to a variety of factors that make it less attractive or risky from a lending perspective.

Reasons a house might be deemed Unmortgageable:

Let’s explore some common reasons why a property might fall into this category.

No kitchen or bathroom:

A property without a functional kitchen or bathroom is considered unmortgageable because these are essential amenities for comfortable living. Lenders will usually require a property to have these basic facilities in place to ensure that the property is habitable and meets the minimum standards of living conditions.

Severe damp or dry/wet rot:

Properties with severe damp or extensive dry or wet rot may be deemed unmortgageable by mortgage lenders. Damp and rot can compromise the structural integrity of a property and pose health risks to occupants, which can make lenders cautious about providing finance for these properties, as they may require costly repairs and affect the property’s long-term value.

Asbestos or other chemical pollutants:

The presence of hazardous substances, like asbestos or other chemical pollutants, can render a property unmortgageable. Asbestos, for example, poses significant health risks when disturbed, which can make lenders wary of financing these properties.

Where the property is located (mining shafts, landfill, flood risk)

Properties located near mining shafts, landfills, or in areas prone to flooding are considered less mortgageable. Mining shafts can pose stability risks, landfills may emit noxious odours and attract pests, while flood-prone areas present potential damage and insurance concerns. Lenders may also be put off by properties near industrial or commercial areas, like factories, petrol stations, garages, pubs or flats above restaurants and shops.

Lenders factor in these risks when assessing the viability of granting a mortgage on such properties!

Structural issues:

Properties with pre-existing, severe structural problems, such as subsidence or extensive damage are often deemed unmortgageable. Lenders may be cautious about financing homes that require substantial repairs or pose a safety risk to occupants.

Property valuation:

If the property’s value is significantly lower than the asking price or market value, it may be challenging to secure a mortgage. Lenders typically have strict criteria for loan-to-value ratios, making it difficult to obtain financing for properties with valuation issues.

Non-standard construction:

Certain types of construction, such as timber-framed, pre-cast reinforced concrete (also known as prefabricated or ‘prefab’ homes) or thatched-roof properties, can be viewed as non-standard. Though not inherently unmortgageable, these properties may require specialist lenders or a more comprehensive assessment before you’re able to secure a mortgage.

Leasehold issues:

Unresolved or complex leasehold issues, such as short lease lengths, high ground rents, or ongoing legal disputes, can sometimes deter mortgage lenders. They tend to prefer properties with secure and straightforward leasehold arrangements, ensuring long-term stability for both the homeowner and the lender.

Planning permission and building regulations:

Properties with unauthorised or non-compliant alterations or lacking proper planning permission and building regulations certification may face mortgage restrictions. Lenders prefer properties that adhere to legal requirements as this protects their investment.

Energy efficiency:

With increasing emphasis on sustainability and energy efficiency, properties with poor energy performance ratings may find it difficult to obtain a mortgage. Lenders may require a minimum Energy Performance Certificate (EPC) rating to reduce future running costs and environmental impact.

Japanese Knotweed or other invasive weeds:

The presence of Japanese Knotweed, a highly invasive plant, can pose a significant threat to a property’s structure and value. Lenders may be reluctant to finance properties affected by this plant due to the potential costly eradication and remediation processes.

In each of these cases, lenders are primarily concerned about the safety, habitability, and long-term value of the property. They aim to mitigate risks associated with potential health hazards, costly repairs, or adverse environmental factors that could affect the borrower’s ability to repay the loan as well as the property’s marketability in the future.

While these factors may make a property initially unmortgageable, it can often be possible to address and rectify the issues, making the property mortgageable with the necessary repairs, renovations, or risk mitigation measures.

If you’re struggling to obtain a mortgage on your property due to any of these issues, reach out to our team of expert mortgage advisers for advice and support.

What to Do if Your Property is Unmortgageable

If your property falls into the unmortgageable category, there are steps you can take to increase its mortgageability:

Seek professional advice:

Consulting with experienced mortgage advisors can provide trusted help and support into finding potential lenders who specialise in unmortgageable properties.

Address the issues:

Work with qualified professionals like structural engineers, surveyors, or architects, to assess and resolve any issues affecting your property’s mortgageability. Repairing structural problems or obtaining proper certifications can significantly enhance your chances of securing a mortgage!

Understanding what makes a house unmortgageable is crucial for anyone trying to obtain a mortgage in the UK. While various factors can contribute to a property being labelled unmortgageable, it’s important to remember that solutions exist even for the most challenging cases. Seeking expert advice and exploring alternative financing options can help turn an unmortgageable property into a mortgageable one, ultimately leading you closer to your dream of homeownership!

If you require assistance in assessing your property’s mortgage-ability or exploring specialist lending options, get in touch with our experienced team of mortgage advisors today. We are here to guide you through the process and find the best solution for your unique circumstances. Remember, your dream home may be more mortgageable than you think!

Share this article

About Key Solutions

Here at Key Solutions we believe taking out a mortgage should be easy. Why shouldn’t it? So when people say buying a home or getting a mortgage is one of the most stressful things ever, we say, come and speak to us.

Subscribe to our Newsletter

Don’t miss out on our award-winning mortgage and insurance advice!

If you would like to quickly understand how much you could borrow for your home moving mortgage, complete our property calculator:

Related articles

Buying a home is an exciting and significant milestone in anyone’s life. For most, securing...
If you’re going through the process of getting a mortgage or buying a house, you...
Buying a property is a long-winded, difficult process. There are so many different elements and...
Are you a first-time buyer in the UK dreaming of owning your own home? Congratulations...
If you’re in the process of buying a house, you may be wondering about property...
What comes first: buying a new house or selling yours first? Just like the chicken...
You might think when purchasing a new home that a house survey is an unnecessary...
When you’re getting a mortgage, there are many unfamiliar terms you may come across. Understanding...
Are you a homeowner aged over 55 based in the UK? If so, it is...
Securing a mortgage can be difficult and confusing at the best of times. And if...
Skipton Building Society launches ‘Track Record Mortgage, a 100% mortgage (£0 deposit) that encourages renters...
Renovation costs should be top of mind if you are planning a house renovation. New...
Over 50 and concerned about getting a mortgage? As you get closer to retirement age,...
The mortgage process can be long and frustrating, so the last thing anyone wants is...
Your credit report is used by mortgage lenders to decide whether you’re a low-risk consideration...
After what seems like years of searching, you’ve found your dream home. It’s in an...
When it comes to buying a home, there’s more to consider than just finances. Although...
When it comes to figuring out the right mortgage for you, the variety of choices...
 Is now a good time to buy a house? It’s a question we often get...
Wondering if you can pay a mortgage off early? And if it is even worth...
When you apply for a mortgage in the UK, the lender will need a number...
With the huge increase in interest rates, almost daily we are being asked whether it...
Is now the best time to remortgage? Should I switch my mortgage rate now? We’re...
Stamp Duty is a major cost to budget for when it comes to purchasing your...
Everyone across the UK is facing higher living costs, but with little or no extra...
Are you thinking of taking your first step on the housing ladder? A key part...
When selecting a mortgage, it’s important to look at more than just the monthly repayments...
Going through a divorce or separation is stressful at the best of times, but also...
Mortgage refinancing or remortgaging is a subject we love to talk about often. We’ve written...
Taking your first step on the housing ladder is a very exciting time, however there...
If you’re wondering if you can get a mortgage when you are self-employed, you’ve come...
Buying your first home is a big step and a very exciting time in anyone’s...
Whether you are buying your first home, moving house, or looking to remortgage, you’re probably...
At a time when it seems to be increasingly difficult to purchase a property due...
The first time buyer mortgage market is still strong in the UK, with lenders offering...
You may have heard of the term ‘adverse credit’ but what actually is this? Adverse...
“How long are mortgage applications taking?”, “How long after valuation to mortgage offer” and “How...
A second charge mortgage is essentially a second mortgage on your property. If you wish...
Today we are sharing our top tips on what you can do to improve your...
Now may be the best time to remortgage and save money on your monthly mortgage...
If you are interested in understanding how to pay off your mortgage quickly then we...
Whilst circumstances are going to differ from person to person, it definitely pays to discuss...
Nobody likes to think about the worst happening to them or their family. At a...
IR35 is a bit of a head scratcher and with the new rules coming into...
While most homeowners have a mortgage, many don’t realise that they could save money by...
One of the most common questions we get asked at the moment is about getting...
You have probably seen the news but we wanted to let you know the property...
There are many benefits of being mortgage free in the UK; from freeing up funds...
The Help to Buy Scheme recently celebrated its 5th birthday this year!