Please advise on remortgage

massa121

I am at present free from tie-in period infact since last September from my current lender Halifax and on their current SVR which is high. The reason I did'nt move was because I was made redundant and had no job. I intended to hunt for a better deal when I got employed. I have no CCJs or any adverse credit. I do not intent to go to any advisor but would appreciate any best offers you can suggest at present for my situation which is as follows:-

- Outstanding amount is £37000 and have 11 years left on my term.
- Only income is £13500 single
- Equity about £120000

I have been living on overdrafts, credit cards and loans when unemployed and keeping up mortgage payments as there was unfortunately no payment cover policy when made redundant. Now my total debt is £21000! So what I want to do is remortgage and raise capital to pay my debts off.

I am only employed now on permanent full time for a month so is there a lender who would give me a mortgage and further advance? If not then my other option I can see is secure loan. So any advise on best current product for my situation would be much appreciated.

nadnad

sorry - just to clarify you are now permanently employed - or only employed for a month? i assume you mean you have been in permanent employment for a month? why don't you phone around and find a fee free mortgage advisor? You are in a good position mortgage wise - owing only £37000 calculating 3.5 times your salary you shouldn't have any problems getting a mortgage for that amount. But you may have to wait a while - until you have 3 months payslips etc. However I would imagine that getting the extra £20k to cover your debts might be a little more difficult on £13500. The fact that you have so much equity is attractive to mortgage lenders. What are you currently paying per month? would you be happy to extend the time left on the mortgage? why not take a look on moneysupermarket.co.uk and play around with the figures so you can get a feel for the types of figures you're looking at, what you would be comfortable with etc.

massa121

Hi nadnad, many thanks for your reply. Yes you are right in assuming that I am now on permanent full time employment. I am now paying 6.5% SVR which is about £383.69. I will look at moneysupermarket but thought since some brokers come to this site might be able to tell me in their judgement what product is best for me now.

nadnad

hopefully someone will come along shortly and advise you on individual products. you're paying £383.69 on your mortgage but how much are you paying each month for the other debts?

massa121

"you're paying £383.69 on your mortgage but how much are you paying each month for the other debts?"

I am paying £792!

nadnad

gees thats nasty must be crippling you - hopefully someone will get back to you with specific products soon - but in an effort to have it all laid out for them - and maybe to get some short term help for you maybe you should list all you outgoings individually - credit cards, overdraft, loans etc. I took a quick look on moneysupermarket and you're looking at about £450 -£500 per month for a mortgage most that came up is Northern Rock. However as I said you are in a good position in that you have a lot of equity in your property - if no one replies soon take a look about and phone some financial advisors - find one that doesn't charge fees and get some good advice. I'm sorry I'm not of more help.

Ian_W

Hi massa,
The £57K you want to borrow is about 4.3x earnings which isn't massive but is perhaps a bit above the norm. The issue you might face is that you've only been in this employment for a month so I would get some advice off a fees free whole of market broker. Another good idea would be to see what rate you could get from Halifax with the additional lending tagged on. They won't give you the best "brand new customers only" deals but they do, I believe, have retention rates much better than their SVR. As they know you have kept up your payments on the existing mortgage they may not do a full check on your employment. Depending on your age a way to lighten the load might be to extend the mortgage and pay it back over longer than the 11yrs you have left.
BTW, must have been tough going, you've done well to get through it and get back in employment. BoL.

regularsaver1

There is one product available for existing customers at the moment (they just changed today) that has no arrangement fee and no early repayment charges - which is 5.9% better than your current SVR 6.5% - you could do that anyway

There would be a £275 further advance fee - but the rates are much lower to borrow - but the underwriting and affordability checks would still be made to do the additional borrowing - they do have to do a credit score and key how long you have been in employment.

No harm giving them a call, good luck

massa121

Many thanks for replies.
@nadnad
I am losing sleep over this as now all avenues of transfers and overdrafts have reached their limit. On top of all this Iwas doing a new kitchen project and my builders having taken money (half amount) £4000 for materials have done a runner and project not finished yet. Thanks for looking at moneymarket for me and I did the same yesterday.

@Ian W

Yes my fear was same that very short time in employment and still on probationary period which would be for 6 mths and can't wait that long. I rang Halifax yesterday and they can offer me some better deals but no advance without doing a credit score search which I didn't want to do before finding out the best product and then do just one search. Halifax first said they can't give me best product available until credit score is done but when I asked for products that they can offer without further advance I was given a few choices which would bring my monthly payments down by about £20. One which I liked was a tracker + .59% until 30.9.09 with fee of £249. They can do it straight away but I need advance.

I am 38 yrs and have thought of increasing term by 4 yrs to 15. This morning I woke up thinking instead of taking advance to clear everything maybe I should take to advance to clear large loans which would reduce amount I want to £15k and total mortgage to 52k. Maybe I would stand a little better chance.

@regularsaver1

Thanks, I can definetely get better deal but my problem is to get further advance on it with my income. I think I have just 10 days and my good credit would be tainted with missed payments.

Ian_W

Extending would still put you into early/mid 50's by the time it's paid off and if things improve later you may be able to overpay and bring it down again. Obviously that means paying more interest because it's over a longer period but sometimes "needs must" as it were.
You mentioned in your OP about a secured loan, Martin describes them as "lending of last resort", I'd certainly have a good read around the loans/mortgage section of the site as it might throw up things you hadn't thought of.
BoL.

massa121

Many thanks for your reply. I will keep in mind caution about secured loan.