Additional Borrowing in One Name

Dave_Fallow_2 · 13 October 2016 at 11:38AM

Hi all,

I have a mortgage with Nationwide, it's a joint mortgage with my wife. We've been with them a few years and never had any problems. We have a decent amount of equity in the property and are looking to unlock some of that to carry out some work. Nationwide have a mortgage top up questionnaire on their website where you punch in all your details and they tell you how much additional cash they'll lend you.

When I input all of our details on the questionnaire, the bottom figure they're prepared to lend us is £16k which is not what I was expecting. By process of elimination, I have determined that the issue lies with the wife. She recently became self employed and it appears that, because this has only been for a short period of time (6 months ish), this blows us out of the water for a sizeable advance. If I run the questionnaire as a sole application just using my details, I can borrow an additional £82k - add her in and it drops significantly.

So my question is, is it possible to apply for additional borrowing solely in my name when our existing deal is joint? As I understand it, the advance will run as a separate loan alongside the existing mortgage??? I don't have any issues on the affordability side, I am an OK earner and all of the bills in our household come out of my earnings, the wifes self employment is more of a hobby and the income it generates is a luxury for her.

Any advice is greatly appreciated.

Thanks
Dave

kingstreet · 13 October 2016 at 12:02PM

Dave_Fallow wrote: »

is it possible to apply for additional borrowing solely in my name when our existing deal is joint?

Not that I know of. A further advance is an extension of lending under the current charge over a jointly owned property and is allocated a sub-account within the main mortgage.

A second charge/secured loan from a third party may be your only short-term solution.

getmore4less · 13 October 2016 at 12:08PM

is that loan application with wife as a dependent

Seems a bit silly if you can apply for joint with one not earning but make them a n earner and the amounts go down.

might be better for her to give up work(hobby) for a month while applying if that is the case

kingstreet · 13 October 2016 at 12:11PM

If she wasn't party to the mortgage in the first place, as a sole borrower the OP can borrow more.

However, as a joint applicant with a nil income/unacceptable income, she is effectively a dependent and this brings down the borrowing power on a joint application the OP cannot avoid.

Dave_Fallow_2 · 13 October 2016 at 12:14PM

getmore4less wrote: »

is that loan application with wife as a dependent

Seems a bit silly if you can apply for joint with one not earning but make them a n earner and the amounts go down.

might be better for her to give up work(hobby) for a month while applying if that is the case

No, it wasn't with her as a dependant, I just left her out of the equation entirely on the hope that I could in some way just do this all under my name. It is frustrating as what I'm after is comfortably affordable - I'm after 50k ish and they would theoretically be prepared to lend me over 80k based solely on my affordability alone. But they seem to be putting a lot of weight on the risk of her only being in business for a short while.

Dave_Fallow_2 · 13 October 2016 at 12:21PM

kingstreet wrote: »

If she wasn't party to the mortgage in the first place, as a sole borrower the OP can borrow more.

However, as a joint applicant with a nil income/unacceptable income, she is effectively a dependent and this brings down the borrowing power on a joint application the OP cannot avoid.

Thank you. This was my fear. I guess I need to go down the route of a personal loan in my name with a no doubt much higher rate than I would get on an advance. The plan all along was to carry out the works which are set to significantly increase property value, then remortgage and bring it all back under one single loan. So hopefully I can make this a short term arrangement anyway.

getmore4less · 13 October 2016 at 12:32PM

Dave_Fallow wrote: »

No, it wasn't with her as a dependant, I just left her out of the equation entirely on the hope that I could in some way just do this all under my name. It is frustrating as what I'm after is comfortably affordable - I'm after 50k ish and they would theoretically be prepared to lend me over 80k based solely on my affordability alone. But they seem to be putting a lot of weight on the risk of her only being in business for a short while.

was she working on the original application?

try with her as a house person not earning see what you get.

Dave_Fallow_2 · 13 October 2016 at 12:55PM

getmore4less wrote: »

was she working on the original application?

try with her as a house person not earning see what you get.

Yes, she was full time permanently employed when we first took out the mortgage. Ironically, the move to self employment was something we viewed as being affordable as my earnings comfortably cover all expenditure in the household. I'm starting to wish I hadn't OK'd the idea now!

I'll give it a go but by the looks of things, I won't hold out much hope! Thanks for the advice.

Dave_Fallow_2 · 13 October 2016 at 1:16PM

getmore4less wrote: »

was she working on the original application?

try with her as a house person not earning see what you get.

No luck unfortunately, it drops by a couple of grand. Looks like this one is dead in the water! Thanks for all the help.

Thrugelmir · 13 October 2016 at 1:35PM

Dave_Fallow wrote: »

Thank you. This was my fear. I guess I need to go down the route of a personal loan in my name with a no doubt much higher rate than I would get on an advance. The plan all along was to carry out the works which are set to significantly increase property value, then remortgage and bring it all back under one single loan. So hopefully I can make this a short term arrangement anyway.

You'll struggle to obtain a personal loan for that amount of money.

Even if you carry out the works and increase the value of the property. That doesn't negate the affordability criteria that'll be used on remortgaging.

amnblog · 13 October 2016 at 9:06PM

Dave

Everything you have said here makes you a prime candidate for a second charge (secured loan) which you may have missed in Kingstreet's post above.

Such lending is generally more flexible with regard to underwriting and you can repay it inexpensively through remortgage once you are in a position to do so.

Consult a good mortgage broker.

Additional Borrowing in One Name

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