Underpinned Property Mortgages

‘Subsidence’ describes a process in which the ground underneath a property moves – making the foundations of the building unstable. In drastic circumstances, ‘underpinning’ is the work which involves stabilising the soil and foundations that lie beneath the building.

Underpinning and subsidence can affect how lenders view a property. In this article, you’ll learn about mortgages for underpinned property – how to get one, how they differ from normal mortgages and what to look out for.

What is underpinning and how does it affect a mortgage?

Underpinning is a construction method used to strengthen a building’s foundations. It is often necessary when a property has experienced subsidence, which occurs when the ground beneath a house shifts, causing instability in the structure.

Common causes of subsidence

Subsidence can happen for several reasons, including:

• Soil shrinkage: Clay soils expand and contract with moisture changes, leading to foundation movement
• Tree roots: Large trees near a property can draw moisture from the soil, causing it to dry and shift
• Water damage: Leaking drains, pipes, or flooding can erode the soil supporting the foundations
• Poor foundation construction: Older homes or properties built on weak soil may have insufficient foundations

How underpinning works

Underpinning stabilises a building by reinforcing or extending its foundations. There are different types of underpinning, such as:

• Mass concrete underpinning: Concrete is poured under the foundation in stages to strengthen it
• Beam and base underpinning: Concrete beams are placed to distribute the building’s weight more evenly
• Mini-piled underpinning: Deep piles are driven into the ground to reach more stable soil layers
• Resin injection underpinning: Expanding resin is injected into the ground to compact and stabilise weak soil

How it affects a mortgage application

Even though underpinning is meant to improve structural integrity, mortgage lenders may still see it as a risk. Properties with a history of subsidence are often subject to more lender scrutiny and higher insurance costs. However, with the right documentation and strong application, getting a mortgage on an underpinned home is still possible.

Can I get a mortgage on an underpinned house?

Yes, but it depends. In many cases where the lender’s surveyor is satisfied with the remedial work, getting a mortgage with underpinning is not too dissimilar to getting a mortgage on a ‘regular’ residential house.

As such, the ‘standard’ factors apply. If you want to mortgage an underpinned house, the size of your mortgage deposit, your credit history, and how much money you make can all help sway a lender in your favour.

If you’d like some friendly advice about getting a mortgage on a property (whether underpinned or not), get in touch. One of the experts we work with will be happy to help.

Does underpinning affect a mortgage?

The short answer is yes, but the actual extent of this depends on several factors that we’ll cover below.

Mortgages on underpinned houses are not uncommon. Generally speaking, things should be relatively straightforward – provided the survey shows that the structural problems have been addressed and the underpinning work has been completed to a high standard.

However, things that could cause issues include…

How long ago was the subsidence?

• If the underpinning work was completed 10+ years ago with no further issues, many lenders will view the property as lower risk
• Recent underpinning (within the last 5 years) may raise concerns, requiring more documentation and higher deposit requirements

How severe was the subsidence?

• Minor subsidence that was quickly repaired is viewed more favourably
• Severe cases requiring extensive underpinning or multiple repairs can make mortgage approval more difficult

What kind of underpinning work was done

There’s more than one way to underpin a house, and lenders see some varieties of renovation as more reliable than others. For example:

• Some methods, like mass concrete underpinning, are well-established and widely accepted by lenders
• Newer techniques, like resin injection, may require additional proof of long-term stability

Do you have the right paperwork?

• A full structural survey from a chartered surveyor is essential
• Documentation proving the underpinning work was carried out by qualified professionals
• Any insurance-backed guarantees for the work done can reassure lenders

Tips to increase your chances of mortgage approval on an underpinned property

If you’re considering taking out a mortgage on an underpinned property, here are a few tips that will increase the likelihood of your mortgage being approved.

Provide comprehensive documentation

• Obtain a structural engineer’s report confirming the property’s stability
• Have all certificates, building regulation approvals, and underpinning guarantees available

Increase your deposit size

• Lenders view underpinned homes as higher risk, so a 20-25% deposit can improve your chances of approval.

Choose a specialist lender

• Some high street banks may refuse underpinned properties, but specialist lenders and building societies are often more flexible.

Work with a mortgage broker

• A mortgage broker experienced with underpinned properties can match you with lenders more likely to approve your application.

Consider a full home insurance policy first

• Many lenders require insurance before approving a mortgage. Find an insurer who covers underpinned properties before applying.

Pros and cons of buying an underpinned house

Buying an underpinned home can be a cost-effective way to get a property that has already had structural issues resolved. However, it also comes with some risks, particularly regarding mortgages, insurance, and future resale value. Below is a breakdown of the key pros and cons to consider before you make a decision.

Pros

• Lower purchase price: Underpinned properties are often cheaper than similar non-underpinned homes, meaning you could get a better deal
• Structural stability: If underpinning was carried out professionally and certified, the home is often more stable than before
• Reduced Risk of Future Subsidence: With the right underpinning method, the issue should be permanently resolved, making future problems unlikely
• Opportunity for appreciation: If the area is desirable, the lower purchase price could mean more potential for capital growth over time
• Strong negotiation position: Sellers of underpinned properties often accept lower offers due to the perceived risk, allowing you to negotiate

Cons

• Mortgage restrictions: Some lenders may be unwilling to finance an underpinned home, requiring a larger deposit or specialist lender
• Higher insurance costs: Standard home insurers may refuse cover, meaning you’ll need specialist subsidence insurance, which can be more expensive
• Potential resale challenges: Future buyers may have the same concerns as you, which could limit demand when you sell
• Survey scrutiny: Mortgage lenders and surveyors may require extensive documentation to prove stability, adding extra admin
• Limited lender choice: Some high-street banks may decline a mortgage outright, forcing you to seek specialist lenders with higher interest rates

Talk to an underpinned mortgage expert today

If you have questions about underpinning mortgages and want to speak to an expert for the right advice, call Online Mortgage Advisor today on 0330 818 7026 or make an enquiry.

Then sit back and let us do all the hard work finding the broker with the right expertise for your circumstances. We don’t charge a fee and there’s absolutely no obligation or marks on your credit rating.