UK Edition
Three unexpected ways your home purchase could fall through
Property ownership remains the dream for most Britons, but for the majority of would-be buyers it’s far from plain sailing.
Research by consumer watchdog Which? Mortgage Advisers found that 66pc of home buyers run into some form of issue while purchasing a property. One in eight have a potentially deal-breaking problem on the day of completion.
The problems are myriad, from benign hiccups such as delays with the mortgage process to more serious setbacks such as your almost-home being sold to someone else behind your back.
As many as three in 10 sales fall through altogether, the research found.
David Blake, an adviser at Which? Mortgage Advisers, said: “Moving home can be time-consuming, stressful and expensive. While there are some problems that are out of your control, there are things you can do.”
Here are three ways buyers get tripped up – and the best ways to avoid them.
Mortgage delays
The delay often comes out of the mortgage process and its bewilderingly complex lists of criteria. The best way to prepare for this is to make sure you understand what will be required from you as early as possible.
Neil Whippey, 36, left his job in the food industry a few years ago to set up his own business selling packaged edible insects called Eat Grub. While he already owned a property, he wanted to buy with his girlfriend, Meghan Christie, 29, who also works in the food industry, but was surprised to find that his existing lender wouldn’t accept a mortgage transfer.
The ranks of the self-employed are growing, now making up 15pc of the working population, according to the Office for National Statistics. But many mortgage lenders' criteria mean some, particularly the recently self-employed, are locked out.
Mr Whippey said: “I thought it would be more complicated given my circumstances but I didn’t realise how problematic it would be.”
Many lenders require at least two years worth of accounts and tax calculations to support an application. Most people in this group will be better off with a small specialist lender.
Eventually, after consulting a broker and extending the mortgage term to 34 years, the couple secured a two-year fix with Natwest at a rate of 1.5pc and were able to purchase a flat in north London for £390,000.
Some lenders will also shy away from new-build properties, flats with short leases and properties above commercial premises such as convenience stores or kebab shops.
Kevin Roberts, the director of Legal and General Mortgage Club, said: “Ultimately, some mortgage journeys will be more challenging than others, but a rejection or setback in the process shouldn’t feel like the end of the road.
“Mortgage brokers are on hand to guide customers through the process from start to finish, offering holistic advice throughout the application, and often afterwards.”
Secret sales
When Holly Hayman, 28, and her partner Reuben Bakker-Dyos, 30, found a three-bedroom house in Bristol on the market for a price they could afford they thought they had hit the jackpot.
But after agreeing a price of around £300,000, and just days before completion, the transaction hit a significant bump in the road – the property had already been sold to someone else.
The couple had fallen victim to trick used by some sellers to ensure a certain sale. They had already agreed a price with another buyer but, to make sure the deal didn’t fall through, they strung along Miss Hayman and Mr Bakker-Dyos as a back-up.
Miss Hayman said: “The agent told us it had been on the market a few months ago and didn’t sell but we didn’t think anything of it. We put our properties on the market and they both sold within 24 hours.
“The I got a call from the agent, and he had a really apologetic voice on, and he told us it had been sold to someone else already. The seller had basically conned us into putting in an offer in case it all fell through.”
The couple, who had both agreed sales on their existing properties, upped their offer by £10,000 and crossed their fingers. Eventually, after more than seven months, they were accepted and they moved in last month, paying a total of £325,000 for the house.
Invasive plants
Getting an independent survey of a property you wish to buy could be an important step in avoiding unforeseen issues.
Seemingly small details, such as the presence of Japanese knotweed in the garden, could drastically reduce the value of the house or, at worst, make it unmortgageable.
The plant, which was introduced to British gardens in Victorian times as a "harmless" pot plant, has been carried around the country on trains and in canals and now afflicts thousands of properties.
Pensioner Robin Waistell is currently attempting to sue Network Rail for failing to deal with knotweed at the side of the tracks near his property in the Welsh town of Maesteg. He claims the plant has devastated the value of his home.
Ensure you have a surveyor check for knotweed before agreeing to purchase a house or flat. The Telegraph revealed earlier this year that due to a legal loophole that means developers do not need to declare the presence of knotweed, buyers of new-build properties are particularly at risk.
According to experts, many mortgage lenders will agree to lend as long as a treatment programme – which should eradicate the pest – is in place.
But research from Swansea University, released last month, suggests that Japanese knotweed cannot be fully eradicated using current methods.