First time buyer - guarantor advice/info

joefizz

Just one thing to mention about being Guarantor, it limits your future credit. Something that wasnt totally explained to me a few years ago.
So although they might give the go ahead now, be wary if you plan any loans or remortgaging when you are still acting as guarantor as it might limit you.

Parisien

joefizz wrote: »

Just one thing to mention about being Guarantor, it limits your future credit. Something that wasnt totally explained to me a few years ago.
So although they might give the go ahead now, be wary if you plan any loans or remortgaging when you are still acting as guarantor as it might limit you.

Thanks for that Joefizz........don't tell me they are mis-selling this to me....;)

I think this is my last mortgage, done all the buying prior to this! But does this affect other credit rating etc...or just limits what you can get as a standard loan?

Ideally, after a few years our son takes it over in his name so assume all back to normal, credit wise?

Parisien

trebor21 wrote: »

Would suggest
http://lpsni.gov.uk/vListDCV/search.asp?submit=form

Will give you rough guide 2005 prices give or take 10% for value now depending on condition

Hi Trebor, just so I am clear.......the current prices listed are the same roughly as the 2005 years prices?

Great site mind you....lots of details...many thanks!!!

trebor21

Yes,
These are the land registry valuations based on 1st January 2005 levels.
Should give you a starting point when looking around.

Parisien

Ok...the site says up-dated today(!).......if they are 2005 prices how then can I check the valuations for June 2011?

saverbuyer

Hi Parisien I've been reading this thread with interest and thought I might be able to help. I looked into guarantor mortgages a few years back but descided against it. It was with the northern and worked like this.

One parent retired 52
One parent working 55

Mortgages

My parents were assessed on their ability to pay the mortgage on their own if I couldn’t make the payments. The term of the mortgage would only be taken up to their retirement ages. So the maximum term was 11 years and they had to meet affordability on an 11 year term. My parents did not have an existing mortgage and were helping me out with a 25% deposit. I couldn't get the mortgage if they couldn't meet the criteria. Not sure if my father pension was allowed to be considered.

I spend a lot of time researching the NI market. Its worth pointing out I was looking in south Belfast near the university. Houses I looked at two years ago have dropped approx 25% in that time. Luckily I didn’t go ahead with the idea.

The figures you looked at on the LPS give the Rateable Value as collect in Jan 2005. This is the value LPS assigned to the property in 2005. Its not 100% accurate but not bad considering there’s nothing else. Talking to estate agents in south Belfast now they say we are at 2004 price levels. That means the LPS rateable value should give you the approx value of the house in 2005.

There are lots of houses available in the university area. I would say its probably way below this 2005 level.

Hope this helps.

Parisien

Saverbuyer, thanks for that very useful insight....must double check to see if any of this is doable as I am in my 50s too!

Parisien

Ok...phone Northern, they are ok to allow 25 yr term as its in my sons name.

Will do further research...because listed prices are still 10-20% higher than the 2005 values!!!

saverbuyer

No problem I hope it helps a little. I live in the uni area myself. You say your son is going back to uni. If so unless he's going for a PhD the mortgage would have to be 100% in your name as I doubt even his PT wages would be enough to be included in the affordability calculations so would only be available for a term taking you to retirement. You could always get a BTL mortgage but have to prove rent would be 125% of the mortgage payments. So if mortgage is £500 per month the average rent would need to be £625.

I really wouldn’t recommend buying in this area for a while yet (1-2 years at least) there are plenty of house for sale around Queens that would suit students and the prices still look to be falling. I was talked out of buying here a few years ago and it has saved my parents and me lots of pain. There’s also the inevitable increase in student fees, which I think is going to kill the rental market here completely and have a lot of landlords trying to sell up.

trebor21

Its just a guide, some will be more and some less.
I belive anything around that level you have midigated most of the risk, as if they go down another few percent the money you would have paid in rent will offset the difference, but certainly dont pay 200k for a place that has a ratable value of £100k! Also alot of propertys are open for negioating, you could certainly offer lower than the advertsied price.