Mortgage for Prefab House?

Question

I have an appointment with nationwide in a couple of weeks to set up a mortgage (already looked around for one, Nationwide was the best for me), but i have just found out the reason the house I want is cheap is because an offer someone else put on it was rejectected by their mortgage company because it is prefab. will this effect me getting a mortgage on it?

i have 10% deposit and the house has had a structural survey in the last month proving it is fine

asking this question now as i want to know if i need to start looking round mortgage companys again

Answer 1

Yes, I do think you have to be cautious about this, you are going for something called non-traditional build which there are mortgage restrictions on, a lot of the circa 1970s council housing that was built with prefabricated concrete panels comes under this category, if on the other hand you have a real 1940s prefab they are very retro and in demand now (if there are still any standing).  I would honestly do some research into what your mortgage company's attitude is into non-traditional build and compare it with some other high street options.  There will always be a lot of mortgage lenders who will say that they are sympathetic to non-traditional build, but they are usually just after your money, and especially ex-council tenants buying and selling.

Answer 2

You will probably be able to get a mortgage on it, but you will not be able to get home insurance. Those houses don't hold up for more than 5-7 years, and in the event of a natural disaster they'll be demolished.

Okay, so you're saying it was built 50 years ago?  What is the value now compared to then? Pre-fabricated homes don't hold their value like a traditional home, so they are less appealing to the lender as their value tends to depreciate.

Answer 3

Don't ask us---Check with nationwide

diff companies have diff underwriting standards

prefab home does not preclude obtaining financing, particularly with structural survey

Answer 4

you will fined it hard to get a mortgage on this type of house they don't like these houses i sold one and the buyer had to get a loan not mortgage i had to sell mine 3 years ago for 12.000 pounds it will decrease in value don't buy

Answer 5

The banks all seem to be tightening up on lending.I would go & see what they say.

Good Luck

Answer 6

A 'regular" house would qualify for any mortgage.  THe interest rate would be apx 6.5% because the banks like to loan on "regular" houses.

A prefab house is much less desirable to a lender.  That will change in the next few years.  You will either have to put more money down or you will pay 8.5% interest or both.  The lenders have gotten burned a thousand times when they loaned on poorly constructed "prefabs".  They don't want to get burned again.

You might only find 2 companies in town who will even do the loan you want.

Answer 7

it should be fine --modulare home are different from manufactured. They appraise just like sight built homes

Answer 8

Prefabricated houses are still permanent, just because they were built off-site and delivered whole shouldn't affect you from getting a mortgage...

Answer 9

Banks are tightening up all over the world and calling in risky loans all over the place.

So they will likely want you to have a strong ability to pay them back i.e. your income

If insurance is an issue and the life expectancy of the building on it is low then I would say that the bank will want some kind of additional collateral, this could be anything from another property or a larger deposit.

The value of the land will be acceptable but if the loan value exceeds the value of the land then the bank is likely to expect more deposit to cover for the high rate of depreciation on the building.

It would be prudent to speak to some banks to get a clear view on their current lending policies.