Section 157 Mortgages
How to Buy or Remortgage a Restricted Property – Bright Money
Section 157 Mortgages: How to Get Approved for Restricted Properties
Buying or remortgaging a property with a Section 157 restriction can feel confusing — most lenders won’t touch them, councils have strict rules, and it’s easy to hit a wall before you’ve even started.
At Bright Money, we specialise in helping people buy, sell, or remortgage homes affected by local occupancy clauses — including Section 157 properties in places like Devon, Cornwall, Norfolk and the Cotswolds.
We’ll explain what the restriction means, how to get council consent, and which lenders are open to these mortgages in 2025.
🏡 What Is a Section 157 Restriction?
A Section 157 covenant is a legal clause in a property’s title that limits who can buy or live in the home.
It comes from Section 157 of the Housing Act 1985, and it’s often used by councils in designated rural or National Park areas to keep housing affordable for local people.
In simple terms:
A Section 157 property can usually only be sold to someone who has lived or worked in the local area for a set number of years — often three.
Councils use this to stop second homes and keep local families in the community.
🧭 Where You’ll Find Section 157 Homes
These restrictions are common in scenic or high-demand areas, including:
Cornwall – especially in coastal and National Park zones
Devon – such as South Hams, North Devon, and West Devon councils
The Cotswolds – ex-council homes and village developments
Norfolk and North Norfolk – homes sold under Right to Buy schemes
Peak District & Lake District National Parks – rural affordable housing schemes
Each council sets its own eligibility rules. For example:
South Hams (Devon)
Residence / Work Requirement: 3 years local connection
Things to be aware of: Must apply for council consent before purchase
Cornwall Council
Residence / Work Requirement: 3 years residence or work
Things to be aware of: Applies to many ex-council coastal homes
Cotswold District
Residence / Work Requirement: 3 years residence or work
Things to be aware of: Consent letter required for lender
North Norfolk
Residence / Work Requirement: 3 years residence or employment
Things to be aware of: Must prove connection before exchange of contracts
⚖️ Buying a Section 157 Property – Step-by-Step
If you’re buying one of these homes, you’ll need to follow a few key steps:
Check the title deeds
Your solicitor or conveyancer can confirm if a Section 157 restriction is registered on the property.
Confirm local eligibility
Contact the local council to check what counts as a “local connection” (usually proof of address, employment, or family ties).
Apply for written council consent
Councils normally issue a consent letter if you meet their criteria — this is essential for most lenders.
Find a mortgage lender that accepts Section 157 properties
Many mainstream lenders won’t lend on restricted titles.
Specialist lenders (like LiveMore, Bath Building Society, and a few regional banks) often do — and that’s where we can help.
Get mortgage advice early
With Bright Money, we can assess your eligibility, contact suitable lenders, and guide your solicitor through the process to avoid delays.
Remortgaging a Section 157 Property
Already own a restricted property? You might find your current lender won’t allow a remortgage — even if you’ve been there for years.
Bright Money works with lenders who understand Section 157 restrictions, so we can often help you:
Remortgage for a better rate
Borrow additional funds for home improvements
Release equity later in life (including retirement interest-only options)
We handle the tricky parts — lender criteria, property valuation, and council consent — to make sure your case goes smoothly.
Can You Get Around a Section 157 Restriction?
Not really — and you shouldn’t try to. It’s a binding legal covenant that “runs with the land.”
However, some councils allow exceptions or discretionary waivers if:
No eligible local buyer can be found after a set marketing period (often 3–6 months)
The property has been empty for an extended time
You meet partial eligibility (for example, work locally but recently moved)
We can help you present your case properly to the council and lender so you have the best chance of success.
🧾 Documents You’ll Usually Need
When applying for council consent or a mortgage, you’ll likely need to show:
* Proof of address history (e.g. utility bills, tenancy agreement, council tax)
* Employment contract or payslips showing local work
* Evidence of time spent in the area (3+ years typical)
* Copy of the title register or Section 157 covenant wording
* Council consent letter (once issued)
Bright Money can help you prepare everything and liaise with your solicitor and lender to keep things on track.
FAQ
about
Section
157
Property
Restrictions
Can I rent out a Section 157 property?
Sometimes, but restrictions usually apply. A Section 157 property is intended for people with a local connection, and renting it out may only be permitted to tenants who meet the same eligibility rules. In most cases, you will also need written permission from the local authority before letting the property.
Can I remove a Section 157 covenant?
Very rarely. A Section 157 covenant is usually registered on the property title to keep homes available for eligible local buyers. You can apply to have it discharged or varied, but local authorities almost always object and the restriction usually remains in place.
What happens if I buy a Section 157 property without meeting the criteria?
The purchase may be delayed or prevented if eligibility cannot be confirmed. If the restriction is breached, the local authority may take enforcement action. Buyers should always confirm eligibility and obtain any required written consent before exchanging contracts.
Which lenders accept Section 157 properties?
Lender appetite changes regularly, and most lenders assess Section 157 properties on a case-by-case basis. Key considerations include how the restriction is worded, the local authority’s requirements, and how the property could be resold in the future.
Do Section 157 restrictions affect property value?
They can. Because Section 157 restrictions limit who can buy the property, resale options may be more limited. As a result, these properties can sometimes be valued lower than similar unrestricted homes, depending on location and demand.
Can I use an affordable home ownership scheme mortgage on a Section 157 property?
Sometimes, but it depends on the local authority and the scheme rules. Certain affordable housing arrangements, such as shared ownership or other local schemes, may be compatible in some areas, while others may not.
What is a Section 157 local connection requirement?
A Section 157 local connection requirement means buyers must meet criteria set by the local authority, such as living or working in the area, having close family locally, or contributing to the local community. The exact definition varies by council.
Can I remortgage a Section 157 property?
Yes, it may be possible to remortgage a Section 157 property. However, lender choice can be limited and the local authority may need to be notified or give consent, depending on the wording of the restriction.
Do I need council approval before exchanging contracts on a Section 157 property?
In most cases, yes. Buyers are usually required to obtain written confirmation from the local authority confirming they meet the Section 157 eligibility criteria before exchanging contracts.
Can first-time buyers purchase a Section 157 property?
Yes. First-time buyers can purchase a Section 157 property as long as they meet the local connection requirements set by the council and satisfy lender criteria.
Are Section 157 properties harder to sell in the future?
They can be. Because eligibility is restricted, the pool of potential buyers is smaller, which can affect how quickly the property sells and how it is valued compared to unrestricted homes.
Ready to Enquire about a Section 157 Property Mortgage?
We’re not just a mortgage broker — we’re specialists in niche and restricted property lending.
With Bright Money, you’ll get:
* Direct access to lenders who accept Section 157 titles
* Help gathering and presenting local-eligibility evidence
* Guidance through the council consent process
* Support right through to completion
Call us: 01844 390910
Email us: info@bmimoney.co.uk
Or use the form below and we'll be in touch.
