Mortgage on Maisonette: What Every Homebuyer Needs to Know

Getting a mortgage on maisonette 

Navigating the world of property ownership can be a complex journey, especially when it comes to understanding the nuances of different types of properties. Among these, maisonettes stand out as a unique category that often leaves potential homeowners scratching their heads. But worry not; this guide is here to shed light on the mystery of maisonettes and the intricacies of securing a mortgage on a maisonette.

Whether you’re a first-time buyer or an experienced homeowner, the question, “What is a maisonette?” is likely to have crossed your mind. Unlike the more familiar detached, semi-detached, or terraced houses or even flats, maisonettes occupy a distinct space in the property landscape. They offer a blend of features that could be the perfect fit for your lifestyle and housing needs.

But the journey doesn’t end with understanding what a maisonette is. The next big question is, “Can you get a mortgage on a maisonette?” And what if the maisonette is a freehold property? “Can you get a mortgage on a freehold flat?” These are critical questions that we will dive into, providing you with comprehensive insights to make your maisonette mortgage journey smoother.

So, buckle up as we embark on this informative journey, exploring maisonettes, their appeal, and the path to securing a maisonette mortgage. Whether it’s a leasehold or freehold, we’ve got you covered!

Post Topics – Mortgage on maisonette

Getting a mortgage

What is a maisonette?

Are maisonettes freehold or leasehold?

Can I get a mortgage on such property?

What is a freehold mortgage?

Can I get a leasehold mortgage?

Next steps

FAQs

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What is a maisonette?

“Maisonette” is a French word of course with a literal meaning of “little house”. Whereas a house – whatever its size and shape – is typically an independent property, a maisonette is in a building comprising similar dwellings, although it usually has its own separate door onto the outside of the building.

Having your own front door onto the outside world increase your sense of privacy and security, of course.

It is that separate door onto the outside of the building that also distinguishes most maisonettes from flats – the latter having a front door that opens onto a corridor, landing, or foyer shared in common with other flats in the same building.

Nevertheless, the fact that a maisonette shares the same building as other dwellings – if nothing else, supporting walls and a common roof mean that structural features are shared – leaves maisonette mortgages harder to get than regular advances.

Are maisonettes freehold or leasehold?

A further complication – and one that makes getting a mortgage on freehold and leasehold maisonettes more challenging – is that they can be either freehold or leasehold.

In a posting updated on the 4^th of May 2022, the Money Saving Expert explains that if you own the freehold of a property, you also own – in perpetuity or until you sell it – the land on which it stands. Leasehold ownership entails the ownership of the dwelling itself but not the land on which it is built – that continues to be owned by the freeholder who is effectively the leaseholder’s landlord.

Since the majority of maisonettes in the UK are leasehold properties, you are likely to have a landlord to whom you pay both a ground rent and an annual maintenance charge. This is typically for the provision of common services including the maintenance of the exterior of the property and its building insuranceInsurance that covers damage to the structure of a property.....

Ground rents – and especially the landlord’s ability to increase them – have attracted considerable controversy lately. As a result, the Leasehold Reform (Ground Rent) Act 2022 , abolishes all ground rents on new residential leasehold properties and reduces to a token amount the ground rent on an extended portion of an existing lease.

Because a maisonette shares structural features – and risks – with other dwellings in the same building, a freehold maisonette mortgage can be more difficult to secure. Despite the relaxation of issues around escalating ground rents, leasehold maisonette mortgages may be more difficult still.

Can I get a mortgage on a maisonette?

Nevertheless, there are lenders who are happy to entertain applications for both residents and buy to let (landlord) mortgages on both freehold and leasehold maisonettes – provided, of course, that you meet the lender’s borrowing criteria. Your choice of lenders may be more limited and – as ever when this is the case – you might want to consult an independent mortgage broker with experience in these types of mortgages to help you identify the most likely lenders.

What is a freehold mortgage on a maisonette?

As we have seen, when you buy a freehold property, you also own the land on which it is built – including any land surrounding it. As the freeholder, you are then also responsible for any other dwellings which share that plot of land and for the costs of maintaining the exterior of the whole property.

Your responsibilities towards other dwellings related to your freehold come with a financial cost – a cost that lenders will take into account when calculating the affordability of any mortgage for which you have applied.

A variation on this freehold theme is when the freehold is shared with others in the same building – typically owners of their respective leaseholds and a percentage share in the freehold of the entire building. While this may help to share the costs of owning the freehold, it is not without the risks associated with sharing responsibilities for the maintenance of the building with others.

Because of those risks, some lenders will not entertain a freehold mortgage for the purchase of a maisonette with a share of the freehold.

Can I get a leasehold maisonette mortgage?

As we have also seen, the more common form of tenureThe type of ownership or occupation of a property, such as f... for a maisonette is leasehold ownership – and, for its purchase, you will need a leasehold maisonette mortgage.

The biggest concern of any leasehold maisonette mortgage lender will be the length of the remaining leasehold. This is the period set by the freeholder, to whom ownership of the property reverts at the end of the lease. Naturally, the shorter the lease, the less valuable is your home to any prospective new owner and typically the more difficult it will be to secure a mortgage.

Most lenders will be looking for a remaining lease of at least 70 years or for a lease that extends at least 40 years beyond the full term of the mortgage. This is so that the property’s value has not been unduly eroded by the shortening of the lease.

What are the requirements and eligibility criteria for a maisonette mortgage?

Securing a mortgage on a maisonette involves meeting certain requirements and eligibility criteria. Here’s what you need to know:

1. Affordability: Lenders will assess your income and typical expenses, including any ground rent, service charges, or upkeep costs associated with a maisonette. If you’re self-employed or a contractor, you’ll usually need at least three years of accounts or tax returns to demonstrate your average income.
2. Deposit: Most lenders require at least a 15% deposit for a maisonette mortgage.
3. Property Type: The options available to you will differ depending on whether you’re buying a freehold or leasehold maisonette.
   • Freehold Maisonette: You own the property and the land it stands on, including any gardens, garages, outhouses, or driveways. You’ll be responsible for maintaining both, and these costs will be factored into the lender’s affordability assessment.
   • Leasehold Maisonette: You own the property for a period of time agreed upon with the landowner. You’ll pay them ground rent and a service charge for maintaining shared facilities like the building’s roof, gutters, or paved areas. These costs tend to be higher if the property is a new build. Most lenders will accept a remaining leasehold exceeding 90 years.
4. Creditworthiness: Your financial standing and creditworthiness invariably stand at the forefront of mortgage eligibility.
5. New Build Properties: Not all lenders are willing to loan on a new build maisonette because of the potential for higher service charges and ground rent.

Remember, each lender may have their own specific criteria, so it’s always a good idea to speak with a mortgage advisor or broker to understand your options better. They can help you navigate the process and find the best deal for your circumstances.

Next steps

A maisonette in the UK is typically part of a building shared with other dwellings – flats or other maisonettes – and ownership can be freehold or leasehold, with the latter the more common form of tenure.

While it is certainly possible to get a mortgage on a maisonette freehold or leasehold, you might find acceptance of your application more challenging than for other types of dwelling. Because of those difficulties, you might want to consult professional brokers – such as us at NeedingAdvice.co.uk – with experience in identifying likely lenders and assistance in securing the mortgage you need.

FAQs for “Mortgage on Maisonette” and Related Queries

What is a Maisonette?

A maisonette is a unique type of property that blends the characteristics of a traditional house and a flat. It typically features a private entrance, separate from other units, and may include exclusive outdoor space or access to communal areas. Unlike a standard flat in a block, a maisonette might span multiple floors, offering a more house-like living experience within a larger building or complex.

Can You Get a Mortgage on a Maisonette?

Yes, securing a mortgage on a maisonette is possible. However, the process may differ slightly from obtaining a mortgage on a typical house due to the unique structure and ownership details of maisonettes. Factors such as the type of property (freehold vs. leasehold), the presence of communal spaces, and the specific terms set by mortgage lenders in the mortgage market play a crucial role in the application process.

How Does a Maisonette Mortgage Differ from a Flat Mortgage?

Mortgage providers often view maisonettes and flats differently due to their structural differences and ownership titles. For instance, maisonettes can be part of an entire building with a private entrance, which might affect the mortgage terms offered by mainstream lenders and specialist mortgage brokers. Additionally, the maintenance responsibility and service charges associated with leasehold properties can impact the affordability assessment and overall mortgage approval.

Can You Get a Mortgage on a Freehold Flat?

Obtaining a mortgage on a freehold flat is less common but possible. This type of property ownership gives the property owner complete control over both the flat and the land it stands on, unlike leasehold flats, where the land is owned by a separate entity. Freehold flats can present unique challenges in the mortgage application process, and potential buyers may need to consult with specialist brokers or exclusive mortgage experts to navigate these complexities.

What Are the Benefits of Buying a Maisonette?

Purchasing a maisonette offers several advantages, including the feel of living in an actual house with potentially less maintenance responsibility for the entire building. Maisonettes often come with private outdoor spaces or loft spaces, providing a blend of apartment living with the benefits of a larger property. Additionally, the chance of mortgage approval for maisonettes can be good with the right financial preparation and expert advice.

What Factors Impact Getting a Mortgage on a Maisonette?

Several factors can influence your ability to secure a mortgage on a maisonette, including:

• Type of Maisonette: Freehold vs. leasehold can affect the loan terms.
• Property Location: Certain areas may offer more competitive mortgage deals.
• Income and Credit History: Essential for the lender’s affordability assessment.
• Debt to Income Ratio: High ratios may pose a risk of rejection.
• EquityThe difference between the value of the property and the amo... in Current Home: Important for those looking to move or invest.

How Can I Improve My Chances of Maisonette Mortgage Approval?

Working with an experienced mortgage broker, especially one who specializes in maisonette or freehold property mortgages, can significantly improve your chances. These professionals understand the mortgage market’s intricacies, including the best mortgage providers lending to buyers with unique property types. Additionally, preparing your finances, improving your credit score, and understanding the impact of the property type on your application can help secure a competitive mortgage.

What Should I Know About Freehold vs Leasehold Maisonette Mortgages?

The main difference lies in the ownership structure. Freehold ownership means owning the property and the land outright, which can simplify the mortgage process but might be more expensive upfront. Leasehold ownership involves paying ground rent and potentially dealing with service charges, which can affect the mortgage’s affordability. Each has its implications on the mortgage application process, approval chances, and the range of available mortgage products.

Additional Considerations for Maisonette and Freehold Flat Mortgages:

1. High Rise Building: If your maisonette is in a high rise, this might impact your mortgage options.
2. Ground Floor: Ground floor units might have different valuations and mortgage conditions.
3. Planning PermissionPermission granted by the local authority for a property to ...: Ensure all modifications have the proper planning permissions.
4. Affordability Assessment: Lenders will scrutinize your financial stability.
5. Independent Mortgage Broker: Their expertise can be crucial in navigating complex mortgage landscapes.
6. Commercial Premise: Be aware of mixed-use buildings which might include commercial premises.
7. Non-Standard Construction: Some properties may require specialist mortgage lenders.
8. Lease Extension: For leasehold properties, consider the implications of extending the lease.
9. Financial Advice: Consult with financial advisors for comprehensive planning.
10. Estate Agent: Their insights can guide you through the property acquisition process.