No one will give us mortgage!

jpbeautybabe

I have house with mortgage here in UK but would like to buy a holiday home for investment in Cyprus. Problem is my husband and myself are both self-employed and what I earn isn't worth considering anyway .We have mortgage of 70k and need to raise another 100k, and was thinking of equity release, banks will not give us anywhere near that as they go off net profit. I know we could probly get celf-cert mortgage but do they work out really expensive? Also any advice on getting another currency mortgage would be great as I don't know much about those. I think though we still need to raise deposit as we can't have 100% mortgage in Cyprus but I could be wrong, anyone know? We have no debt/credit problems apart from loan for 5k from northern rock which we could possibly pay off anyway. The other option would be sell house downsize free up some money but worried about house prices crashing here! Other than that we were planning on overpaying on current mortgage playing it safe and cutting it by half to 7 years , but playing it safe isn't always the best option where money is concerned! We felt by buying in cyprus we may be able to get mortgage paid off quicker as there is quite a boom going on there at moment.
Sorry this is so long, what would you do?Any advice please.

UK007BullDog

Hi There,

This is a specialist subject. You would need to find a broker who does mortgages abroad and who can tell you about the ins and outs. Someone who specialises in Cyprus. But all major banks in the UK have an international mortgage section which can hopefully help you with information. Links to be found on their respective websites.

However for your property here it is all about your self employed income and if it is not high enough then you might not be able to do it. Self cert is an option but the interest rates are higher and you would still have to manage paying for the mortgage as it will more than double (if I understood you correctly) plus you might have to cover the mortgage in Cyprus as well if you do not have a tennant. Can you afford two mortgages?

UK007BullDog

Possible downsizing is also an option or paying off your mortgage here on your property. You have plenty of choices and to me you still seem a bit muddled up as to what you really want to do.

House price crash can happen anywhere in the world. No one is immune from it.

Lipstick_2

Hello. Looking at your circumstances in the post, it is obvious that the route that you could consider is the self certification remortgage route.

Whilst you do not post your incomes, a self certification UK remortgage is available for up to 95% of the property value and I can't say whether this would be available to you due to lack of information.

You need the services of a whole of market mortgage broker to help you, and to guide you to make the right decisions to suit your circumstances but self cert remortgages are not that expensive and certainly could be cheaper than a Cyprus mortgage.

As a quick overview of your circumstances, it may be easier for you to raise the money in the UK and buy in Cyprus for cash but I have posted some Cyprus mortgage criteria below for you to look at:

Mortgages for Property in Cyprus: Currently covers only Greek Cypriot residential property. Loans available for the majority of Nationalities for either House Purchase or remortgaging for other purposes including Home Improvements.

Type of Loan: Repayment Mortgage only

Minimum: £ 20,000 - no Maximum - and must not exceed 70% of valuation or purchase price (whichever is the lower)

Proof of Income: required in all cases (can be made up of Earned Income, Pension, Investment or Rental Income. Please note however, it is not always the case that the Lender will take all or part of these Incomes into account when determining the maximum loan available). Non-Status loans are currently not available.

Term: Maximum 15 years in Cyprus Pounds (10 years in all other major Currencies) - up to age 70

Currency: Cyprus Pounds and all other Major Currencies, including Sterling, Euros, US Dollars and Swiss Francs.

Current Variable Interest Rate: Is either Currently approx 7.25% in Cyprus Pounds or based on 2.00% above LIBOR for all other major Currencies.

Example: For a Sterling Mortgage of £50,000 over a period of 15 years at an interest rate of approx. 6.75% = approx £450.50 capital and interest per month = a total approximate amount payable over the term of £83,090 including capital, interest, arrangement and survey fees.

Hope this helps.

Luv

Lipstick

herbiesjp

What is your UK property value?

What are your two Net profits?

DO you have any other debts?

Please note that going self cert does not alter the income the you earn, it simply means that the lender will not ask for proof of that income (although they reserve the right to ask for any information they want)

jpbeautybabe

My house is worth around 320k. Are net profits were about 19k ish without me looking. Lot more gross! All money is tied up in house!

jpbeautybabe

Also just took on 5k loan from northern rock but could pay that straight back if had to.

herbiesjp

How long have you both been self employed?

Is that £19k each Net profit?

You are looking to raise £170k aganist yor current property worth £320k which is 53% borrowing.

If the Net profit figure is to be multiplied by 2 to get a joint figure, then you should be able to find a lender.

If the £19k is a joint figure already then you will not be able to take this any further I'm afraid

jpbeautybabe

19k is a joint figure. Just been looking at standard life they seem to do mortgage for self employed, anybody know anything about this mortgage?
Thanks.

JoeK_3

You are asking for trouble trying to afford that size of mortgage on your stated joint incomes. It's a recipe for disaster in my opinion.

If you want to peruse your quest, you should consider down sizing.

JoeK

jpbeautybabe

Just thought I'd add this mortgage would be on a interest only mortgage anyway. Also thinking of letting 4th bedroom. There would be noway i would risk losing house!