Guarantor outside UK for FTB mortgage?

The_big1

Hi this is my first post here.

My partner and I are trying to get a mortgage approved and trying to get the best deal we can.

Its proving harder than we thought even though we are both working and have saved several thousand pounds for our deposit.

Someone said you can ask a parent or someone to be a guarantor which the banks will like, but would it be ok if they are overseas?

somethingcorporate

Almost certainly no as how would they be able to enforce the guarantee if they are abroad?

If you cannot afford to save up a deposit it is unlikely you can afford to run and maintain a house.

kingstreet

I think I can say, without fear of contradiction, no chance.

How could a lender apply a guarantee, under English law, against someone resident outside the UK?

What is the problem? Why is a guarantor being suggested and by whom?

The_big1

My partners father has loads of money, he actually works for a lending institution and he is talking about being the guarantor.

The_big1

Surely the point of a guarantor is that if the mortgage payer defaults, the guarantor is responsible for meeting payments, if he defaults then the bank repossess's as long as the house price hasnt fallen the bank can not lose.

somethingcorporate

The guarantee is worthless then so the people borrowing should borrow on their own merits.

If you need the guarantee to be accepted and this is worthless then seems like it is not really in the banks favour.

If the bank lends 95% against a guarantee and is forced to repossess and sell the house they will lose a great deal, thinking otherwise is naive.

The_big1

Well maybe you are right but this father seems to think he can arrange a mortgage to buy in the Uk.

We will see if you are indeed wrong on this.

Is there anyone else on here who knows about mortgage guarantors?

The_big1

I have just been reading Phil Spencers book called "how to buy your first home" that came out last year.

He says on p43 "there are even special guarantor mortgages, where the parents guarantee the payments if the lender is concerned about the FTB's ability to keep up payments." But he says these offers are constantly changing, is this why I cant find much info about them at the moment?

I wondered if anyone on here knew anything about this and could point me in the right direction?

kingstreet

There are guarantor products.

There are helping hand products, where a charge is taken over a relative's property or a charged savings account is used as additional security.

All these are predicated on the guarantor, property or savings being located in the UK.

In the event of repossession, the lender sells the property more cheaply to get its money back quicker. Ordinarily it would pursue the borrower and any guarantor for any shortfall. This is impossible if outside the UK.

leveller2911

The_big1 wrote: »

I have just been reading Phil Spencers book called "how to buy your first home" that came out last year.

He says on p43 "there are even special guarantor mortgages, where the parents guarantee the payments if the lender is concerned about the FTB's ability to keep up payments." But he says these offers are constantly changing, is this why I cant find much info about them at the moment?

I wondered if anyone on here knew anything about this and could point me in the right direction?

I wouldn't take too much notice of Phil or crusty.His company went bankrupt in 2009 so take his advice with a large "pinch of salt".......There are good mortgage advisors on here so I would take their advice over a TV pundit any day.

antrobus

kingstreet wrote: »

...How could a lender apply a guarantee, under English law, against someone resident outside the UK?...

By ensuring that the person is resident in a jurisdiction that will enforce the civil judgement of an English court? Like a former commonwealth country or a fellow member of the EU?