Extending my Mortgage - HELP

Dave_Ham

holly_hobby wrote: »

Hi all and OP,

Few issues really ... but (as Dave H says) there is a possible solution we may be able to discuss.

Firstly ... Daves asked all the qs that are needed to ascertain the siutation, but could I ask, how old you and your wife (or whomever are the listed propety owners) are ?

Did you seek and obtain planning consent for you bldg works, has this also been signed off by the Local Authority Planning Dept aka Blds Inspector ?

Have Land Reg been advised of the extension to the dwelling (ie revised deeds drawn up showing the amended dwelling perimiters & additional annex ?

By annex I am assuming this forms part of the main dwelling, and is not a stand alone unit ? (ie not a little bungalow or such at the bottom of the garden ?)

I know I am now stating the obvious, but you were legally bound to advise your lender of the amendments to the building (even if it has increased the market value), as this is a material change to their security, which could actually have a negative effect (due to the niche market seeking properties with granny annexes).

You say you can't prove income, or the declared income you have isn't sufficient to support your interest only borowings for an extended term of 5 yrs - therefore this isn't an option with your lender.

You say that your plan in respect of your interest only borrowings, was in 2014 (ie scheduled redemption) to sell the property.

But that is contradicted by the fact that you say, that you don't want to sell at this juncture as it would greatly upset your 89 year old mother in law. (to which I can only guess that when you effected this mge in 2008, you assumed Mum would "no longer be affected" by your anticipated sale in 2014 i.e mge end). However she is still about, so you now wish to extend the term to 2019, when she will be 94 yrs old ... but she may still be a concern (despite her advanced yrs) .... putting you squarely back to the issues you have today.

Self cert mortgages don't exist anymore (notwithstanding, it would be naughty to scert income you don't receive).

So the only other option I can think of when looking at the figs, is an equity release lifetime mortgage (thats why your ages are important), which in a nutshell have the following basic terms ....

borrowing capacity is not based on income but age, property value and reqd LTV

they have no requirement for monthly repayments (although there is a provider who does permit this - ringfencing the original debt)

nor do they have a max age redemption ceiling

with redemption(repayment) occuring on death or entry into long term care ....

BUT this would only be appropriate if you intended to remain in the property, for well, life ! This is due to the pretty hefty early exit penalites of such arrangements.

Would this be a suitable solution (subject of course to meeting the providers criteria re age etc), whilst considering the issues re Mum's security of accomodation whilst needed (which could be for some yrs yet .. hopefully !)

Holly

Holly as always makes decent, concise reading. I had not even entered into the building without lender knowledge part as I imagine securing a new mortgage is the primary concern.

My head says that you may have children, which could potentially allow you to use their income (with an appropriate lender) and you on the residential mortgage.

My issue here is that we are not just looking for a tricky case solution, given your other thread (and hence why I asked) I believe this will be an adverse case also, which multiplies the difficulty.

As I said (I think) there will be a solution, but some concessions on rate, product and product type may be required - as similar a good broker to piece together the best for you..

Good luck

holly_hobby

Yep, assuming all the relevant permissions and sign offs were sought, the lender may well require a re-inspection to ascertain their security has not been negatively affected by the undisclosed works ..... thats if the income issues and extension can be sorted with them.

I've not seen the OPs other thread, so not sure what the adverse is, but generally on a LTM arrangement, this isn't as much of an issue, and such applicants (inc those whom are discharged bankrupts/satisfied IVAs), will still be considered by various providers, on an individual basis - as always 1st charge status is reqd, so any existing 2nd charges would also need to be discharged at time of such a remortgage being effected.

Hope this helps

Holly

patboyo

Hi everyone,

I decided to phone BM last week and without saying anything about the extension etc. I asked if they would increase my mortgage term by another five years and guess what; they did it within a week of my asking.
How's that for a result!!!

Dave_Ham

patboyo wrote: »

Hi everyone,

I decided to phone BM last week and without saying anything about the extension etc. I asked if they would increase my mortgage term by another five years and guess what; they did it within a week of my asking.
How's that for a result!!!

I stand corrected and amazed - well done though - definite result..!

holly_hobby

Gosh, with no verficiation of income, that is good (but albeit surprising) news ..... !!

But you must still keep in mind the issues discussed above, which have only been deferred until 2019 ....

Anyways, the pressure is off for now ....

Well done you !

Holly x

patboyo

Hi everyone,

next challenge- I received the Completion Certificate this morning for my Extension & Annex so good eh!!

Now I need a way to raise £20,000 to finish the driveway, rendering and some internal finishing.

Any ideas will be very helpful.


Regards,

Patboyo

holly_hobby

Ideas other than personal loan or further advance ?

H

patboyo

I thought further advance on my mortgage?????

holly_hobby

You're say you have no proof of income (which suggests none declared for tax, but thats for another debate) ... so to that end, how will you prove you can afford any FA or Loan ?

Isn't this what your first issue was all about, in respect of extending the term for a further 5 yrs !?

An old expression my Grandad used, immediately sprung to mind when I read this ... "much wants more"

Holly

patboyo

Hi all,

i hoped that the level of equity might help.

as far as tax, the last financial year was spent building the extension & annex for around 140,000 but the money I want to raise now is to totally complete the project, no labour charged, it's family.

By the way, I received the Completion certificate a couple of days ago for the entire project.

Any help???