Own property, no mortgage, low income - how to fund move?

mlz1413

blued wrote: »

How many people actually read the first post? I got from it that

OP wants to buy another house to live in
Sell the items in the current house at auction
Sell the other house when empty

Nothing about the OP wanting to renovate as so many replies mention
Nothing about wanting to sell the house at auction

Sorry had to get that off my chest!

I'm glad you posted, I decided it was just me who had read it that way!

MildredTalbot

blued wrote: »

How many people actually read the first post? I got from it that

OP wants to buy another house to live in
Sell the items in the current house at auction
Sell the other house when empty

Nothing about the OP wanting to renovate as so many replies mention
Nothing about wanting to sell the house at auction

Sorry had to get that off my chest!

I think some readers may not have grasped the immensity of clearing a large house when the items (and indeed the property) are of some personal interest and/or potential value. I think I can do it in the year having made the necessary mental adjustment.

I had already taken advice and decided that I am not going to spend time, effort and money "doing the place up for sale". Yes - there's profit for somebody in doing that - but it won't be mine.

I think the auction aspect may have crept in because it's an immediate cashflow - which is one of my ideal "wants" and people picked up on that. But having seen how ruthless country house and contents sales are, I don't want to go that route. And I might well lose out big style if there's a ring in operation on the day. I'm prepared to spend to store some things that are surplus to need in a smaller place in the gamble that they may appreciate faster than the storage charges.

My purpose in the original question was to see if people had ideas for getting a substantial amount of money, as a loan or mortgage (which will have to be paid from the proceeds of the sale of the larger house), given my specific financial and domestic situation.

I was also curious to find out if somebody could explain why I appear to be such a bad risk to lenders - which has been answered across a few posts. I've also had an e-mail pointing out that if everybody could do this - using property to get cheap money at mortgage rather than loan rates - I'd be doing better than the banks and that wouldn't do at all! The social system allows for one dwelling to be aspired to .. not more.

Thanks for bringing people back to the OP - this thread is attracting a large amount of interest.

M

starlet10

MildredTalbot wrote: »

The banks and building societies won't touch me because I don't earn enough.

EdInvestor wrote: »

That's the reason you can't get a mortgage, nothing more complex than that.

I haven't encountered any disadvantages in owning our property outright. We have owned our house outright for a few years now, but we were able to remortgage it whenever we needed to do some maintenance or renovations on our home. The only difference from the OP is that the lenders can see that we could afford to make the monthly repayments from our monthly income, while the OP's monthly income maybe not be sufficient for the amount he wishes to borrow (£160K), without selling his property first or using his savings.

If it is going to take the OP so long to mentally adjust himself to clearing out all his beloved possesions, then he should take that time to do it slowly and not be in such a rush to take on a temporary one year mortgage. He should spend the year clearing out and selling his items at the prices he thinks they are worth, or for the best price he can get for them. After a year, his house will be cleared out and be ready for selling. He can then sell it, buy a down-sized property outright and add the remainder to his savings pot.

Rockporkchop

OP - apologies if this has already been suggested but rather than go down the high street bank or building society route, have you tried to get a "non status" mortgage to remortgage your current home. If you google it, you will find that there are a lot of companies who guarantee that they will not ask you to prove your earnings. It will cost you a bit more than a normal mortgage but will be worth it.

MildredTalbot

Rockporkchop wrote: »

have you tried to get a "non status" mortgage to remortgage your current home.

I've had a look at some on the web - as you say the rates are much higher (when you can find currently available ones) - but critically - I'll struggle to come up with the typical 20% deposit. I'll certainly get a few more quotes though - thanks for the pointer.

Rockporkchop

I don't think you would need a deposit at all if you did a non status remortgage of your current house saying its for home improvements (which is more or less true), rather than a mortgage for your new one. Try a decent broker like London and Country or John Charcol first.

MildredTalbot

Rockporkchop wrote: »

... remortgage of your current house saying its for home improvements (which is more or less true)

I hate the "LOL" one often sees on fora, but that certainly made me smile!

Rockporkchop wrote: »

. Try a decent broker like London and Country or John Charcol first.

It was in a phone call to L&C that I was told that "what you are proposing is tantamount to money laundering". I'll try the other one though ...

Just been speaking to JC. They say they have been taking enquiries from a number of people in my position recently. Confirmed that, specifically because of income level, any kind of mortgage is a non-runner (which we have established in this discussion). A bridging loan is the only available product they could offer. Ball park figures - for the 160K I need to have on call I can expect to be paying 2K a month interest and fees with repayment in full at the end of 9 or 12 months.

Steep rates - I'm sure somebody will do the APR - but for the benefit to my lifestyle I'm certainly not dismissing it out of hand ...

teabelly

Remortgaging one property to purchase another providing you tell the solicitor where the funds are coming from is perfectly legitimate. I did it. Used the remortgage money as a deposit onto a new house. Let out/sell old one and new one is on standard residential mortgage. Getting remortgage for 'home improvements' and using that to buy another house might be more dodgy as you're not being honest.

Check out the secured loan route too. If you have the deposit cash in savings then buying another place with a BTL mortgage and living in it with another person as a live in landlord maybe another option. As long as you're honest with what you're up to then you should be ok. Rates will be much, much easier. There are BTL providers that allow instant remortgage again so you could buy with a closed bridge and remortgage straight away (all set up first) which would minimise the amount of deposit you needed.

noxon

"Steep rates - I'm sure somebody will do the APR - but for the benefit to my lifestyle I'm certainly not dismissing it out of hand ..."

Erm, I'm probably being thick but I've read the whole thread and am still struggling to understand the lifestyle benefit of getting into enormous debt for 12 months to make mortgage payments on a new property while you clear out and sell the old one when you could instead just do the clearing out now, then sell and buy in the normal way without ever needing a mortgage.

MildredTalbot

teabelly wrote: »

Remortgaging one property to purchase another ... then buying another place with a BTL mortgage...There are BTL providers that allow instant remortgage

Unfortunately all this comes back to the problem outlined in post 1 and elaborated later - I can't get any sort of mortgage because my income is too low.

I can't use the existing house as a letting "business" because of the state it's in, and the rental wouldn't cover the loan interest anyway, and the type of property to which I wish to move would not generate enough rent with me there as live-in landlord to cover it either.

That's if one can even find a BTL or LTB mortgage provider .