Mortgage lenders wont lend what we need: where to get further capital?

emp_3

Sorry If I've confused you helpful people :0(

Our current mortgage has £100k left on it, and we will transfer that to a new property, at the current rate and will be fixed for the same length of time it currently is.

The additional part of the mortgage - so up to £132k will be a separate and new application. Alas though it can't be the £188k we would like!

I've got myself confused explaining the current mortgage - the ERC isn't relevant - what I'm referring to is the fee for leaving the product early - because we tied in for 2 yrs, sorry.

What I suppose I was really asking is: Is there any other means of borrowing than a mortgage? i.e. when the people on Grand Designs find 50k extra where do they get it?! I hoped someone would tell me there's an online lender called:
cheaploanstoboostyourmortgageoffer.com

emp_3

Onto your question about what you can do. You have requested from your bank rightly what they would charge you and will not extend further credit, meaning either you are at your borrowing limit (as this would be a new mortgage) or something has changed within your circumstances. Or given your large overpayments, one of you are not declaring all of the income you are earning and therefore we are where we are...

It may be worthwhile considering to approach an external bank or broker for an agreement in principle (once talking with a broker or checking their affordability calculator online) about what they would lend as to sell your home and buy another and form part of a chain is typically going to take you at least 3 months.

So depending upon what your ERC's are then you can calculate how much you want/need to move. Give consideration to the fact 2nd mortgages are out there, although likely to be an expensive alternative and furthermore they are non highstreet banks in many cases. You will also have different end dates on products and always likely to get hit for 2 product fees and make any onward movement tough.

Rambled on for a bit now, food for thought for you....[/QUOTE]

Hi Dave Ham - how do 2nd mortgages work? I thought lenders wouldn't do that as then the risk is divided by 2 companies? this would be great if we could take the additional 58k we need with someone else.....

Thrugelmir

Continue to overpay your current mortgage by as much as you can afford.

Thrugelmir

emp wrote: »

Hi Dave Ham - how do 2nd mortgages work? I thought lenders wouldn't do that as then the risk is divided by 2 companies? this would be great if we could take the additional 58k we need with someone else.....

Risk isn't divided. Charges are ranked in order.

So second charge holders will charge a higher interest rate to reflect increased risk.

emp_3

Hi Thrugelmir

Sorry i still dont think im explaining myself well! we still are overpaying £900 a month - but that's on our current mortgage - we want to move so we will continue to overpay (the new mortgage is the same monthly amount but we will extend the term to 20 yrs from 10yrs) - OR if we were lucky enough to get the extra loan to buy the house I'm mentioning, then that £900 a month can go on repaying the second loan.... or mortgage if that's the case.

So Ill look into a second lender - so high street banks are unlikely to do this? and will my high street bank who my current mortgage is with mind me taking a loan with someone else to cover the extra? or can they say no?

opinions4u

1) Find another lender who will provide a mortgage for the full amount wanted (and pay the ERC).

2) Buy a cheaper property.

3) Commit a mortgage fraud, by failing to tell the lender you've borrowed additional funds from an individual or company such as Geoffrey Robinson.

Thrugelmir

If interest rates were to rise. Then the additional borrowing would add considerable pressure to bear on your finances. Assuming your overpayments would fund the additional mortgage is optimistic (in my personal view) over a 20 year time frame.

Dave_Ham

Sorry, we are all talking at cross purposes to a degree.

I am not talking specifics here; but say you take out a second loan/mortgage for the additional amount needed for this home. This could be at a rate as high as 10% and therefore better advice would be to stomach the ERC's and change to a new mortgage provider that will lend you what you want.

Thats why I was assessing your numbers as your £15k figure just cannot be accurate, certainly not based upon a 2 year fixed deal for £100k mortgage... well I do not think so..

Check this figure as if it is much lower it will be a better alternative than taking out an expensive 2nd loan/mortgage...

Forget all of other types of financing from the home in the country programs as these are the exception and not the norm.

emp_3

opinions4u wrote: »

1) Find another lender who will provide a mortgage for the full amount wanted (and pay the ERC).

2) Buy a cheaper property.

3) Commit a mortgage fraud, by failing to tell the lender you've borrowed additional funds from an individual or company such as Geoffrey Robinson.

Pah, this greatly sums up what I didn't want to hear ! thanks v much.

And thanks everyone else for your replies, again even though they weren't what i wanted to hear hehe.

I'm off to check under the sofa cushions for 58k.

danielanthony

Don't forget stamp duty of £12,000 on that purchase price!