Borrowing more on mortgage.

ice_babe

Has anyone borrowed more on there halifax mortgage?

We purchased our flat 6 months ago through right to buy and at the time we asked to borrow more but could only borrow the purchase price.

Dave_Ham

You will first need to check the terms of your Right to buy

On the assumption that you used their discount to fund the deposit, I think it is incredibly unlikely you will be able to raise funds after 6 months.

The Local Government is protected for 4/5 years and therefore I do not believe this will be possible

I am only assuming though, so best place to ask will be Halifax

ice_babe

I called halifax last month and they said we could apply from the 12th November.

Dave_Ham

LTV is irrelevant if it is made up entirely of the discount.

When you check, get the advisor to check rather than steaming you in for an application.

The more I think about this, the less likely I think it is you will be able to achieve it

Locana

Hi

I think the council may put a charge on the property protecting the discount. I think (not entirely sure) that the bank would have to ask permission to suspend the charge, but may only do so if you were doing the place up, but then you may need to prove redecoration by providing receipts etc. They may 'release' some of the discount year by year as payback of discount reduces by a fifth every year for five years.

I think!

Lo

ice_babe

We had allready done the place up as have lived here 6 years . We have put in a driveway at the front, new bathroom, replaced all doors and decorated to a high standard ect.

When the council valued it they couldnt include all our improvments and valued it at 80k (as it was valued with no driveway, council standared bathroom :eek: ect) When halifax valued it they took into account all the the improvments like the off road parking for 3 cars and valued it at 95k.

So even though we have racked up some debts doing the place up we have actually added 15k to the price :beer:

would we not have been told if the council put a charge on the property? And when we where looking for mortgages some companys where saying you could borrow more ontop of the purchase price for right to buy but we wanted to stick with our bank, also we got a good interest rate with them

Dave_Ham

Think logically, if you sold the house tomorrow do you think you would be able to have all of the profit?

You may be able to raise some, but in the big pack you get from the local council it talks through in painful detail that they have a second charge on the property and you cannot do x, y and z..

I cannot confirm either way, but Halifax and/or local council can confirm

Incidentally, when you are comparing other providers they too will be obliged to seek permission from the council.

Simon_gloster

Locana is correct.

You are in a pre-emption period with the council. They hold a legal charge over the property as their security for your discount.

You are tied for 5 years from date of mortgage start date and can only borrow more from your lender for home improvements. The council will want quotes and will inspect the work to ensure its being done for that purpose.

You would have been able to borrow more on the mortgage, again for home imps only.

Once your out of 5 years your can borrow more for any reason you like as the council will take the charge off the property.

Halifax bods will say november to you as you cannot borrow within 6 months of completion.....but again not for debt consolidation. You physically cannot borrow more on a rtb in the discount period for anything other than home improvements.

ice_babe

I understand where your all coming from
I guess its prob a no go then

Its not the end of the world, Will have to start overpaying the cards instead

ice_babe

Just had another idea.

The mortgage is over 15 years. We could maybe extend the mortgage term to 25 years and overpay the credit cards by 200-300 a month and in 5 years time will have paid of all debts apart from mortgage plus have an extra £200+ pound a month due to csa coming to an end. And could then shorten the mortgage term to 5 years and pay it of.

Dave_Ham

Much better than the first plan, will need to check Halifax are happy mid fixed term though...