What is a fixer-upper?
A fixer-upper is a property that will require considerable repair work to make it a comfortable space for living. Offered at a lower price than the market rate, fixer-uppers allow first-time buyers to reside in their desired postcode at a reasonable cost.What is the first time buyer renovation mortgage?
Fixer-upper mortgages for first time buyers are there to provide you with all the finances you need to purchase and renovate a property. A fixer-upper mortgage will enable you to borrow more than a standard mortgage rate would allow, giving you the freedom to make the house your own and add value should you wish to sell in the future.How to get a buy-to-renovate mortgage
Before you apply for a fixer-upper mortgage, you’ll need to contact a property surveyor to ensure lenders would actually approve it for a mortgage. If the property is unsuitable to live in, it becomes unmortgageable. Most high street banks and mortgage lenders deem a house unmortgageable if:- The property is derelict
- Uninhabitable - for example: lacking electricity, heating, and a functioning bathroom and kitchen
- The property requires conversion
How much can I borrow with a renovation mortgage?
This will depend on your personal circumstances. The amount a lender will allow you to borrow is calculated through checks on your income, outgoings, and credit score. To get a better idea of how much a bank would be willing to lend you for a renovation mortgage, take a look at our mortgage calculator.What to look for when buying a house to renovate
Buying a property that needs renovating can be a great option for first-time-buyers looking to make their first few steps on the property ladder. In fact, Rightmove found that over 90% of homebuyers would consider buying a fixer-upper. However, there are a few things you need to know before starting your application:- Be wary of building regulations and planning permission - Before you get too carried away with envisioning your dream home,
- Conduct a full property survey - A property surveyor will produce a report detailing any problems that might not be initially visible, giving you a better idea of what condition the property is in and whether or not you should make the purchase.
- Do you have time to take on all the work? - Renovating can be really stressful, and if you don’t imagine you’ll have the time to fully commit to the project, it might be worth reconsidering.
- Find the right mortgage lender - As mortgage brokers in Manchester, we can help identify the lenders that will provide the best renovation mortgage rate for your project.
- Set a realistic budget and money aside for unexpected costs - Although buying a fixer-upper can appear to be a bargain to start with, renovation comes with a lot of unexpected costs. Aim to set aside 10-15% of the project cost just in case.
