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    • redviking
    • By redviking 18th Oct 16, 5:12 PM
    • 35Posts
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    redviking
    Pension for Mortgage Term
    • #1
    • 18th Oct 16, 5:12 PM
    Pension for Mortgage Term 18th Oct 16 at 5:12 PM
    I am writing this on behalf of my sister who has given me permission to ask away


    My sister is looking at getting another mortgage and renting her property out, she has a deposit etc


    Issue is, with her partners salary and her combined of approx £40pa, they are unable to get the mortgage amount they want on affordability (loan credit card), they can afford the repayments


    As my sister has no pension until February (auto enrolment) the lender will not increase the offer, until a pension is in place


    Question is, is it worth her taking out a private pension until February and then asking her employer to pay into her private one? Or is it best to just delay it until auto enrolment in February?. They are looking at securing a mortgage as soon as possible, but lender will want evidence of pension, not just a letter from employer stating when enrolment will happen.


    Hope this makes sense


    Thanks
Page 1
    • dunstonh
    • By dunstonh 18th Oct 16, 5:30 PM
    • 85,103 Posts
    • 50,126 Thanks
    dunstonh
    • #2
    • 18th Oct 16, 5:30 PM
    • #2
    • 18th Oct 16, 5:30 PM
    Question is, is it worth her taking out a private pension until February and then asking her employer to pay into her private one?
    It is unlikely that most employers would be willing to do that as it would not meet auto-enrolment criteria.

    but lender will want evidence of pension, not just a letter from employer stating when enrolment will happen.
    The lenders normally need confirmation of what the income from that pension is likely to be using approved projections (typically the mid rate projection). So, the contribution levels are going to need to be high enough to achieve the required level.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
    • redviking
    • By redviking 18th Oct 16, 6:01 PM
    • 35 Posts
    • 2 Thanks
    redviking
    • #3
    • 18th Oct 16, 6:01 PM
    • #3
    • 18th Oct 16, 6:01 PM
    Thanks for the reply


    Her employer has told her that her auto enrolment will start in February, but the lender have asked for some confirmation of that.


    Her employer has said he nothing in writing, which I find strange
    Last edited by redviking; 18-10-2016 at 6:06 PM.
    • dunstonh
    • By dunstonh 18th Oct 16, 6:53 PM
    • 85,103 Posts
    • 50,126 Thanks
    dunstonh
    • #4
    • 18th Oct 16, 6:53 PM
    • #4
    • 18th Oct 16, 6:53 PM
    Her employer has said he nothing in writing, which I find strange
    The November 2017 auto-enrolment dates are getting their paperwork at the moment from the pensions regulator. So, her employer should have had something months ago. They would need to go through an duties checker and should really be at the point where they confirm what they are doing and whom with by now.
    I am an Independent Financial Adviser (IFA). Comments are for discussion purposes only. They are not financial advice. Different people have different needs and what is right for one person may not be for another. If you feel an area discussed may be relevant to you, then please seek advice from a Financial Adviser local to you.
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