Posted on 30 March 2013 by Tim
We currently own a double fronted Victorian house, which is split into two flats. We own both flats and the freehold. We have a mortgage on each flat with different lenders. We now want to convert the two flats into one house and borrow additional funds for a new kitchen. We've had some resistance from our existing lenders to discuss how we can effectively only have one mortgage on the property. Most lenders seem happy to lend if there is a single deed on the property, however we are in a catch 22 situation as this requires our lenders to agree to releasing deeds and a single deed being set up. We would really appreciate some advice on how to resolve this situation.
You're right in that for most lenders this is a 'catch 22' situation. We get quite a lot of this type of enquiry, and typically the way to move forward is that we need to look at taking out a mortgage for development finance / bridging which will allow you to repay both of the current lenders, create the new single title, and convert the two flats into a single dwelling. Once the works have been completed, we can then look to remortgage you back on to a standard residential deal.
We have excellent relationships with those lenders that provide this type of finance, and in the main they are very reasonably priced.
I think it would be worth having a chat with one of our consultants, to run through your options as to how this would work and to answer any queries you may have.
If you'd like to do this, then please let us know by submitting an enquiry and we'll arrange a convenient time for one of them to contact you.
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