Listed Building Mortgages: Expert Advice for Your Dream Home
Owning a listed building is a dream for many, with their rich history and charming architectural details.
However, securing a mortgage for such a property can be more complex than a standard home loan.
This is where expert advice and guidance become important.
At Kerr & Watson, our aim is to make the process as smooth as possible for you.
What is a Listed Building?
A listed building is one that has been officially designated as having significant historical or architectural interest.
These buildings are protected by law to preserve their unique features and heritage.
The official register of listed buildings recognises and safeguards structures deemed important to national history.
Categories of Listed Buildings
Listed buildings are categorised into different grades based on their importance:
- Grade I: Buildings of exceptional interest. Only around 2.5% of listed properties fall into this category.
- Grade II*: Particularly important buildings of more than special interest, making up around 6% of listed properties.
- Grade II: The most common category, covering buildings of special interest and representing around 91% of all listed properties.
Understanding the grade of the building is essential as it can influence your mortgage options and the terms offered by lenders.
Find out Your Options
Can You Get a Mortgage on a Listed Building?
Yes, it is possible to get a mortgage on a listed building, but the process can be more challenging than for non-listed properties. Mortgage lenders assess listed buildings differently due to their unique characteristics, and not all lenders are willing to finance them.
Why Are Listed Buildings Considered Risky?
- Resale Potential: Lenders worry about the marketability of listed properties if they need to repossess and sell.
- Maintenance Costs: Older buildings require more upkeep, which can be costly and impact your financial stability.
- Legal Restrictions: Any alterations or repairs often need special permissions, making the property harder to modify.
Despite these risks, many specialist lenders understand the appeal of listed buildings and are willing to products.
At Kerr & Watson, we have relationships with these lenders and can guide you through your options, based on your individual situation.
Restrictions When Buying a Listed Building
Listed buildings come with a range of legal restrictions that you must be aware of. These restrictions are designed to protect the property’s historical integrity but can also limit your ability to make changes.
Common Restrictions Include:
- Consent for Alterations: Any modifications, even minor ones, often require approval from your local planning authority. Using like-for-like materials is generally allowed without prior consent, but major changes, such as replacing windows or adding extensions, need permission.
- Maintenance Obligations: You are responsible for maintaining the building’s historic features. This can mean sourcing specific materials or hiring specialist tradespeople, which can be costly.
Failure to comply with these restrictions can lead to legal consequences, so it’s crucial to understand your obligations before buying. We would recommend getting confirmation that the solicitor you plan to use has experience with listed properties.
Affordability and Deposit Requirements
When it comes to listed buildings, affordability assessments and deposit requirements can differ significantly from standard properties.
How Much Deposit Do You Need?
Some lenders require a higher deposit for listed properties, potentially ranging from 15% to 25% of the property’s value. However, in some cases, it might be possible to secure a mortgage with as little as 10% deposit, especially if you work with a broker with access to the whole market.
How Much Can You Borrow?
Lenders usually base the loan amount on income multiples, typically between 3.5 and 5 times your annual income. However, affordability is key, and lenders will may into account the higher maintenance costs associated with listed buildings. If your financial profile is strong, you may be able to borrow more, but a comprehensive assessment is always carried out.
Affordability differs from lender to lender so best to speak with an independent mortgage adviser to find out how much you can borrow. You can find out an initial idea using our affordability calculators.
Can You Get a Mortgage for a Listed Building with Bad Credit?
Having bad credit can complicate your mortgage application, but it doesn’t always make it impossible.
Some specialist lenders are willing to consider applicants with a poor credit history, although you may need to provide a larger deposit or pay higher interest rates.
At Kerr & Watson, we assess your entire financial picture and work with lenders who are open to unique circumstances.
We’ll help you find the best possible solution based on your credit profile and the property you wish to buy.
Why Use Kerr & Watson for Your Listed Building Mortgage?
At Kerr & Watson, we pride ourselves on offering tailored mortgage and protection advice that simplifies complex situations. Here’s why we are the best choice for your listed building mortgage:
Specialist Knowledge: We understand the challenges of listed buildings and have access to lenders who have an appetite for lending on these properties.
Whole-of-Market Access: Our network includes specialist lenders not typically available to the public direct, giving you a wider range of mortgage options.
Personalised Service: We take the time to understand your needs and provide bespoke advice, guiding you from initial consultation to mortgage completion.
Trusted Partnerships: We can connect you with surveyors, insurance providers, and legal experts to make the buying process more seamless.
Conclusion
While securing a mortgage for a listed building can be more challenging, it is certainly achievable with the right preparation and expert guidance.
Understanding the restrictions, planning for maintenance costs, and working with experienced professionals can make all the difference.
At Kerr & Watson, we’re here to support you every step of the way.
Get in touch with us today for independent advice and a personalised consultation.
