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    • triggerps
    • By triggerps 19th Apr 17, 6:15 PM
    • 2Posts
    • 0Thanks
    triggerps
    Looking to move - Need advice
    • #1
    • 19th Apr 17, 6:15 PM
    Looking to move - Need advice 19th Apr 17 at 6:15 PM
    Hello all, first time poster so please bear with me.

    I currently have a mortgage which is an interest only mortgage with an outstanding balance of £78500 with 13 years remaining and the current value of the property is roughly £103000 give or take.

    I bought the property in 1997 for £35000 as a new build and was poorly advised by a local mortgage adviser regards which type of mortgage I should have taken out, and took the plunge with an interest only mortgage with an endowment to back it up. Within a year or so I split from my then wife, who, in hindsight, thankfully couldn't get on the mortgage due to her poor credit record and the resulting split, and her declaring herself bankrupt within months of the split, it left me with around £30000 worth of debt that we had ran up together. This then left me as the sole debtor, so to stop the door being kicked in left right and center by different debt collectors, I remortgaged with a little on top to pay off the debts and kind of start a fresh.

    So that's the background of what happend back then and now bringing it forward to today I would like to move and make the right move for me and my other half.

    I am 45 years old and my better half is 53. The mortgage is still in my sole name but we would like to move with a joint mortgage. Our current income is around £35k a year which I appreciate isn't a massive amount but we do live in an area of the UK where the property market is quite low value wise compared to much of the country, and the bank have offered a mortgage of £108000 as long as I sell this property, I mention that because the plan I had in my head was to keep this house, rent it out for around £550 a month and buy a second property for us to obviously live in. Using the first property as a bit of a pension for when that day comes. The bank told us that wouldn't be possible because of the length of time left on the mortgage and also because of the age of my partner. In fact his exact words were "no bank will touch that idea".

    So, if you've stuck with me this far do any of you think it's worth my while asking other banks/lenders if the plan above is a possibility or will they all tell us the same outcome.

    So if the above isn't possible, the next plan it to obviously sell the current property and look elsewhere. Going by the £108000 mortgage offer, the £22k ish equity and another £10k we can put to it, then with my poor adding up skills we can look at properties around the £140k mark. The question I have about this is the bank told us because of my partners age they will only give us a mortgage up to 16 years up to the age she will retire. Again will this just be the the case with that particular bank or will the other banks/lenders offer me something different. I ask this because I thought I'd read that banks will now lend for longer, and given the fact that I still have twenty years work ahead of me, I was hoping I could find a mortgage to fit that timescale.

    So after all that, thanks in advance for any help or advice given.

    Cheers
Page 1
    • ACG
    • By ACG 19th Apr 17, 6:35 PM
    • 15,404 Posts
    • 7,788 Thanks
    ACG
    • #2
    • 19th Apr 17, 6:35 PM
    • #2
    • 19th Apr 17, 6:35 PM
    Banks have differing criteria so for the person at the bank to tell it can not be done is wrong and he/she should not be saying that. They are only allowed to advise on their own products.

    I think it could be done, but you would have to pay stamp duty on the new purchase at the higher rate.

    Speak to a real mortgage broker who has access to the whole market rather than a bank who has access to their own products only.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • Lilla D
    • By Lilla D 19th Apr 17, 9:40 PM
    • 310 Posts
    • 154 Thanks
    Lilla D
    • #3
    • 19th Apr 17, 9:40 PM
    • #3
    • 19th Apr 17, 9:40 PM
    Hi Triggerps,

    Joining ACG in that the bank's advisor should have stuck to advising about what they can do, as other banks have different criteria and that a broker sounds like a better choice than going around trying your luck with various banks.

    However, if you rent out your current property, then my understanding is that the purchase of your new home will not incur the higher stamp duty payment, as that will be your only resi home. This will have to be checked with a solicitor, as they are the ones who can give you proper advice on this aspect.

    Final thought: if you remortgage your current home to a proper buy to let deal instead of just getting a consent to let from your current lender, then it may help to reduce your mortgage balance to 75% of the property value in order to get a decent rate and lower fees
    Last edited by Lilla D; 19-04-2017 at 9:45 PM.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • triggerps
    • By triggerps 20th Apr 17, 12:07 AM
    • 2 Posts
    • 0 Thanks
    triggerps
    • #4
    • 20th Apr 17, 12:07 AM
    • #4
    • 20th Apr 17, 12:07 AM
    Thanks to you both for the advice you've given. I'll keep it all in mind when the time comes.
    • AnotherJoe
    • By AnotherJoe 20th Apr 17, 2:34 PM
    • 7,247 Posts
    • 7,761 Thanks
    AnotherJoe
    • #5
    • 20th Apr 17, 2:34 PM
    • #5
    • 20th Apr 17, 2:34 PM
    Hi Triggerps,

    Joining ACG in that the bank's advisor should have stuck to advising about what they can do, as other banks have different criteria and that a broker sounds like a better choice than going around trying your luck with various banks.


    However, if you rent out your current property, then my understanding is that the purchase of your new home will not incur the higher stamp duty payment, as that will be your only resi home.
    Originally posted by Lilla D
    That is plain wrong.

    If the OP retains their current house and buys another, they will have to pay the extra 3% SDLT on the new one because they are buying an additional property. You only escape it if you are replacing your residence. Buying another residence doesn't count !
    Last edited by AnotherJoe; 20-04-2017 at 4:16 PM.
    • amateur house
    • By amateur house 20th Apr 17, 2:40 PM
    • 226 Posts
    • 200 Thanks
    amateur house
    • #6
    • 20th Apr 17, 2:40 PM
    • #6
    • 20th Apr 17, 2:40 PM
    And you also have to pay it when you are replacing your main residence but not selling your current one (e.g. if other people living there don't want to sell). That's the advice I was given by my solicitor recently at any rate.
    • amateur house
    • By amateur house 20th Apr 17, 2:51 PM
    • 226 Posts
    • 200 Thanks
    amateur house
    • #7
    • 20th Apr 17, 2:51 PM
    • #7
    • 20th Apr 17, 2:51 PM
    The question I have about this is the bank told us because of my partners age they will only give us a mortgage up to 16 years up to the age she will retire. Again will this just be the the case with that particular bank or will the other banks/lenders offer me something different. I ask this because I thought I'd read that banks will now lend for longer, and given the fact that I still have twenty years work ahead of me, I was hoping I could find a mortgage to fit that timescale.
    Cheers
    Originally posted by triggerps
    The lender I got a mortgage with recently said they would lend beyond retirement age if I was able to provide proof of income in retirement. I don't know what they would need, presumably pension forecast statements. I decided to stick with the shorter term and get it paid off by age 67. Sixteen years takes your OH to age 69 though, is that the age she plans to retire?
    • kingstreet
    • By kingstreet 20th Apr 17, 2:53 PM
    • 31,941 Posts
    • 17,070 Thanks
    kingstreet
    • #8
    • 20th Apr 17, 2:53 PM
    • #8
    • 20th Apr 17, 2:53 PM
    For easy reference, if the number of properties you will own from completion will increase, you will pay the SDLT surcharge.

    So, 1 - 2, 2 - 3 etc = yes.

    if the number will still the same, as you are selling to buy, so 1 - 1, 2 - 2 etc = no.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
    • Lilla D
    • By Lilla D 20th Apr 17, 4:01 PM
    • 310 Posts
    • 154 Thanks
    Lilla D
    • #9
    • 20th Apr 17, 4:01 PM
    • #9
    • 20th Apr 17, 4:01 PM
    AnotherJoe - if you quote, please ensure you quote the relevant section and not a mixture of correct and incorrect information while also cutting the comment that the stamp duty was a legal matter to check with a solicitor. However, I stand to be corrected on this point that the higher stamp duty rate was payable in this case.

    Amateur house's profile - dependent on plausibility (i.e. what profession they are in), lenders normally accept applications up to the age of 70, if someone says that they will retire at that age instead of the state pension age. So yes, 16 years can potentially be done.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
    • AnotherJoe
    • By AnotherJoe 20th Apr 17, 4:15 PM
    • 7,247 Posts
    • 7,761 Thanks
    AnotherJoe
    And you also have to pay it when you are replacing your main residence but not selling your current one (e.g. if other people living there don't want to sell). That's the advice I was given by my solicitor recently at any rate.
    Originally posted by amateur house
    That is correct, by "replace" I meant "sell" I should have been more specific !
    • AnotherJoe
    • By AnotherJoe 20th Apr 17, 4:17 PM
    • 7,247 Posts
    • 7,761 Thanks
    AnotherJoe
    AnotherJoe - if you quote, please ensure you quote the relevant section
    Originally posted by Lilla D
    fair comment and actioned (with strikethru so your comment also makes sense )
    • Ganga
    • By Ganga 20th Apr 17, 7:07 PM
    • 727 Posts
    • 352 Thanks
    Ganga
    If you only have an "interest only " morgage on your first property,how do you intend to pay it off if you keep it and rent it out as well as purchase another house?.
    ITS NOT EASY TO GET EVERYTHING WRONG ,I HAVE TO WORK HARD TO DO IT!
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