Earlier this year we did a Mortgage for a client who had a property whose water supply was from a Borehole. I was debating doing a success story on this application. I might still do that due to other complexities with this case, but for now I will just stick to the post on it.
What are Boreholes
Some properties have its water supplied from a borehole rather than being connected to the mains. A borehole is basically a hole drilled into the ground. It is for all intents and purposes similar to a Well.
Usually this is for properties that are relatively rural or remote. A property where it would be too difficult or expensive to get mains to the property.
How can this affect your Mortgage
Being completely honest, in 13 years as a Mortgage broker this is something I had not come across before. It is not often we get something new after so long doing the job. It was quite an interesting one and going off lenders criteria it was something that must not crop up often for them either. There was very little published about their stance on properties supplied by a borehole.
As with more or less any criteria, the difference was quite varied. We had lenders who were fine with it so long as the surveyor deemed it acceptable. We also had lenders who would decline it outright. The lenders who were not open to it were generally declining it because they thought it might affect the property’s appeal if they had to try and sell it.
With the application we were looking at there were other issues to contend with also. This might be similar with your situation and so when we have multiple issues, we have a sort of Ven Diagram. Lenders who ok with the borehole on one side, lenders who are ok with the other issue on the other and lenders who are ok with both in the middle.
The good news is that it actually wasnt too complicated to overcome on its own. But it certainly wasnt for every lender. The complexity seemed to come when we were combining it with other problems. That really started to hit the pool of lenders available.
Summary
A borehole is not too difficult to overcome. It should be possible to obtain a mortgage at normal rates. However, it can become more complex if the property has other issues or if you have complexities of your own (bad credit or quirky income for example).
But do not let it put you off. Despite all of the issues we had to overcome on this applications, we were able to find a handful of lenders who were willing to accept the borehole in combination with the other issues.