The Intermediary – April 2025 - Flipbook - Page 68
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comments to decide whether to go ahead after
ensuring we understood all the relevant factors.
C AS E ON E
Property near a
mine shaft
couple earning a combined annual income
of £65,000 (£40,000 and £25,000) face
significant complications when attempting
to purchase a property priced at £225,000.
During the conveyancing process, their
solicitor’s searches revealed the presence of a
mine shaft in the neighbouring garden. As a result,
their initial mortgage application was declined,
and their previous broker classified the property as
un-lendable.
The mining report highlighted potential
structural risks and a reduced resale value, which
deterred many lenders.
With their deposit of £22,500 at risk, the couple
has been left uncertain about how to proceed, and
face the possibility of losing their dream home.
A
TOGETHER
While we would need a structural report to
confirm the property is safe and any remedial work
potentially needed, Together could lend on such a
property, providing an option for the applicants in
order to not lose their deposit.
The broker could highlight to the valuer that
Together would be able to lend on this property,
thus making it mortgageable, and we could then
look to work our LTV based on this value.
If their deposit was not quite enough, Together
could look to utilise cross-charging options, as well
as allowing up to four applicants to help support
additional affordability if required.
HARPENDEN BS
Unfortunately, this would not be one for the
society. Due to the proximity of the mine shaft
it is unlikely our valuer would deem it fit for
lending purposes.
Also, the reduced re-sale value may exclude it
from our minimum of an advance of £150,000 at
80% LTV.
WEST ONE LOANS
Judging by the couple’s income and the property’s
value, they would be looking at a 90% loan-tovalue (LTV) deal. They satisfy our criteria, and if
they were first-time buyers, we could even look at
95% LTV.
In this scenario, we would not decline based on
location, or due to them being rejected elsewhere.
The couple’s affordability looks promising,
but ultimately, we would rely on the valuer’s
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The Intermediary | April 2025
UNITED TRUST BANK
The presence of a mine shaft in close proximity to
the intended security would be a major concern for
most lenders, including UTB.
The coal mining report will detail any risk the
lender should consider, and a decision will be
made based on that risk. If the report shows little
to no risk of future structural movement we will
often proceed to offer.
