What is a Section 106?
A Section 106 (S106) agreement is a legal agreement between both a developer and the local council. This would usually be a restriction which is required when a developer wants to build a number of homes.
There are also occasionally restrictions on older properties, but these are usually in the countryside and not so much larger towns and cities.
There are various types of S106 agreements, some are in force for a number of years (typically 5 years) and then it may be possible to remove the restriction with agreement from the local authority, but some are longer standing agreements that it may not be possible to have removed.
Types of Section 106’s
There are various type of restrictions, they include:
Holiday homes – typically where the property can only be lived in for maybe 8-10 months of the year as a maximum.
Local restrictions – this could be where the owner must be from the area or now live and/or work in the local vicinity.
Affordable home – this would be where you may be able to purchase the property for say 70% of its true value, but you must also sell the property at 70% of its true value when the time comes to move.
How can we help?
At Mortgage Success we have over 10 years experience as Mortgage Brokers, over 15 working in Financial Services. We have been helping people obtain mortgages on properties with a S106 for many years.
Some S106s are more common than others, many lenders will accept properties with an S106 restriction in place, but some will only accept certain restrictions. This is where an experienced broker can help to save you time and money.
By understanding these agreements and knowing which lenders can accept then, we can help to reduce the time it takes to find a suitable mortgage lender for your new home purchase.
With access to over 80 Mortgage lenders at the last count we are able to help you place your application with a lender who will accept the restriction type you have and at as competitive a rate as possible.
If you would like to discuss your requirements, we would be happy to talk them through with you and see how we can help. Please get in touch if you would like to talk these over.