9:24 AM, 8th May 2015, About 7 years ago 7
I am thinking of buying a newly converted flat (leasehold) that I really like. My mortgage broker however pointed out an issue i.e. it is newly converted and I would be the first buyer since conversion. The property has a building control certificate saying all work complies to regulations but doesn’t have any guarantee that comes with new builds. The seller is offering an indemnity instead.
This is what my broker said “Normally lenders will look for NHBC or Zurich guarantee that often comes with properties classed as new conversions or new builds, these normally cover any building / conversion defects for around 10 years, it will definitely restrict your options moving forward. Unfortunately an indemnity policy wont suffice”
I can perhaps try and get a mortgage on it as I have a good credit rating and can afford 25-40% deposit, but I am thinking, is it worth it? In other words, am I taking a big risk by buying a property with no such guarantee and might face huge costs in future? What kind of costs they might be given the place will have normal building insurance and complies with building control regulations? Is this something that will still be a problem if I sell the place 10 years later?
Any opinions on this will be appreciated.
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