Applying for a mortgage on a home without a certificate of occupancy or habitability can be a real challenge. At Immosegur, we've seen that many buyers underestimate the problems this can cause and end up facing significant financial and legal obstacles.
The main drawback is that banks typically deny financing for homes without these documents. The certificate and license ensure that the property is legally habitable and meets the standards for safety, ventilation, utility connections, and minimum size. Without them, banks consider the home unsafe for mortgage financing.
Another common problem is the appraisal. Appraisers value the property taking into account its legal and urban planning status. A home without a certificate of occupancy receives a lower valuation, which reduces the amount the bank can lend, forcing the buyer to contribute more money out of pocket or seek alternative financing.
At Immosegur, we also warn that the lack of a building permit can prevent the mortgage from being registered with the Land Registry, as well as the contracting of insurance or basic utilities. This creates additional complications and delays the actual handover of the property. Some buyers resort to special loans, but these usually have more restrictive conditions and higher interest rates.
Legally, buying without a permit involves risks. If the authorities discover that the property does not comply with urban planning regulations, they can demand regularization or impose penalties. This increases expenses and can affect the possibility of living in the property immediately.
For all these reasons, at Immosegur we recommend that before attempting to mortgage a house, you review all the documentation and assess the possibility of regularizing it. Working with professionals who are familiar with the regulations avoids surprises and ensures that the transaction can be completed safely and efficiently. Mortgaging properties without a permit is complex and risky. Knowing the common problems and anticipating them allows the buyer to make informed decisions and protect their investment.