Moving Home - Remortgage?

mcarthyryan

Hi,

I currently have an appartment, but would like to move to a house, and include my girlfriend with the Mortgage too.

I owe approx £98,000 on my current mortgage, and my appartment is worth approximately £105,000.

The new house is worth £145,000.

What are the chances of adding my current girlfriend to the mortgage and getting the extra £40,000 added on to it? Or isn't it that simple?

Or would we generally have to go to a mortgage broker and sort a completely new mortgage out?

If we do need a new mortgage, I guess we would need a deposit of at least 10%? We don't have this, but could obviously run a loan along side the mortgage. But we both have loans for cars at the moment.

I have a £9500 loan, and my girlfriend has £5000, and we earn £30,000pa and £15,000pa.

So obviously if we need another loan for the deposit, and I think putting all the loans together would be the best, which would mean a loan of approximately £30,000.

Would having a loan between us of £30,000 but then having a £15,000 deposit go against the mortgage application?

We have done reseach on the internet in terms of cost, and it seems very affordable to be honest.



Thanks for any advice.

somethingcorporate

Just to clear a few things up:

1) You cannot use a loan as deposit for a mortgage, the banks require you stump up the 10% so you best get saving.
2) You do not earn enough for the £30k loan, additionally you also appear to have loans already and even the squeaky clean can only get 50% of income as a loan.
3) You will need a new mortgage / increase the existing but it would still be subject to the normal lending rules (10% deposit etc).

Do you have any savings? If not why not given you say servicing the debt would be so affordable?

Keep working, keep saving and in 6 months you should be closer to having a way forward.

Good luck!

kingstreet

A remortgage is changing your mortgage from one lender to another while staying in the same property.

You are looking for a whole new joint mortgage, as your current one will be repaid when you sell. If you go back to your existing lender and can satisfy their current lending criteria and loan to value requirements they may allow you to transfer the rate from your old mortgage, if it's particularly attractive, or you'd have to pay a penalty to repay it early.

This is called portability. It can save you money, but doesn't give any guarantee that a new mortgage application will be accepted just because you were accepted before.

If I were you, I'd stay where I was for the time being and concentrate on reducing your current credit and saving to increase the deposit you have for the next property.

mcarthyryan

Thanks for the replies

Is the only way to get a mortgage now, is to have the 10% of the house value (minimum) as a deposit? There is literally no way around it now?

I fully understand we should try to pay off all our existing loans etc, and it is definitely the way forward. The only thing is, my current flat is one bedroom, and recently the G/F thought she was pregnant, and things got put in perspective really, as we couldn't really have a baby where we currently are, so was looking at options. Option 1 would be pay off the debts, save a deposit and buy a house that way. But is there any other options out there? We both earn about £8k more each per year in over time, which is 90% guarenteed, but I don't want to include that in anything obviously.



Thanks again

kingstreet

mcarthyryan wrote: »

Is the only way to get a mortgage now, is to have the 10% of the house value (minimum) as a deposit? There is literally no way around it now?

Absolute minimum. You'll need a squeaky clean record to get one at that loan to value too.

dimbo61

You dont give you age or your G/F age but I think you need to tread carefully
You have little in any equity in your one bedroom apartment and you also have loans for cars.
Live together and save save save while also overpaying the car loans, get to know each other and wait to start a family as this will also have a massive effect on your ability to get a mortgage on a house

Peter_L

As the others have said, careful planning and reducing your spending is the way forward. Ask yourself:-

* Do you really need a bigger place now when there is only 2 of you and the state that the market is in at the current moment

* Do you really need the 2 cars or is this for convenience

* Having a family and being single is totally different, are there things you can cut down on now which could help you save (believe me having a family means nights out are a very distant memory but if you can do that now then it's money saved towards a new place)

GAH

Also the value of £105,000 you have put on your property, is that value or an agents value, and is it a conservative value? As in this market nothing is guaranteed and 1 bedroom apartments are harder to sell than anything (maybe with the exception of studios)

From the info given you need to save, save, save, as you won't be a first time buyer, you will need £1450 stamp duty, £1000 in Solicitors fees and other associated costs.

mcarthyryan

Thanks again for the replies!

To answer a few questions:
- I am 28, and my girlfriend is 29

- To be honest, no we don't need a house, compared to our apartment, but it would be nice to have more room, and obviously a house rather than apartment if that makes sense.

- 2 Cars: Definitely don't need them, but it is very convenient - Something we are 100% thinking about getting rid of one of them.

- We've been together 5 years now, so hopefully going in together in the right decision.

- We are both trying to cut down on spending too, as before we would go out every weekend, meals out a lot etc. Which IMO isn't a bad thing, as we can afford it, but obviously now sacrifices need to me made which we don't mind

- My settlement figure on my appartement if I payed this month would be £95,460, and I have had one valuation on the property and they said to advertise it for £112,000 although I'm not sure what people would actually offer?!
As I'm inexperienced when it comes to things like this, if I was lucky (very lucky) to sell it for £112,000 and paid my current mortgage off, I would be left with approx £15-16,000. This could then be used as a deposit on another property couldn't it, and a mortgage lender could be more forthcoming with that?


I 100% agree though, we should wait 2 years perhaps and get rid of our debts and then go from there. But my girlfriend has her heart set on getting "our place", as currently the apartment is "mine" although I don't treat it like that, it is ours, but you know what I mean. I know it might sound strange me saying it, but putting all the figures in etc, to me, even with our current debt we would still afford a house (better standard of living?) and after a couple of years that debt would be gone anyway!?


Another questions: New Builds - How do the Part-Ex schemes work? Would they offer me the approx value of £112,000 on my apartment, or do they take the micky when it comes to part ex values? As we both like new build properties if were honest, and there is suppose to be a new developement soon (well in a few years), and I personally think we should wait for that. Barrett Homes will be building, but I'm not sure if that is a bad idea in itself buying a new build?



Thanks a lot guys

dimbo61

I also live in a modern house but not a brand new property!
You dont have to worry about heating costs so much or do we need a NEW roof etc
Why wait for something to be built go look at a few new housing developments in your area and wait and see if you apartment sells.
go and have a chat with a "whole of market mortgage broker" to see what you can afford first and what deal is best for you!