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Help choosing a mortgage please
Honeybe
Posts: 4 Newbie
Hi, I would be really grateful for some help and advice.
We've just had our offer accepted on a property (yay!) and we will need to borrow £350,000. The purchase price is £500,000 so it's an LTV of 70% exactly. At the moment we have a great tracker deal taken out in 2007 of + 0.75% above base rate. We like the sound of tracker mortgages and we would like to find another deal. I've had a look online and HSBC seems to have some pretty decent deals at + 2.29% for 70% LTV. However I am (perhaps irrationally!) concerned that when they carry out the house valuation, they'll value our house at les than the purchase price and therefore increase the interest rate because we'd be above 70% LTV. In the past, RBS have valued our house at £40,000 less than the sold price and thus forced us into an expensive deal. So my questions are:
1. how common is it for lenders to value at less than the purchase price and is it a sneaky way to get people onto more expensive rates? I do think the house we're buying is worth its price tag and it is in a very sought after area of East of England. It generated a lot of interest too but there aren't any similar houses that have sold recently in the area so Zoopla values it at £399,000.
2. Is HSBC a good lender in terms of handling times and efficiency?
3. Are we right in thinking that a low tracker is the best type of mortgage? We're not keen on the idea of remortgaging every few years.
4. Is the house valuation likely to be more accurate if we do a full survey with the lender as opposed to basic valuation?
Thanks in advance!
We've just had our offer accepted on a property (yay!) and we will need to borrow £350,000. The purchase price is £500,000 so it's an LTV of 70% exactly. At the moment we have a great tracker deal taken out in 2007 of + 0.75% above base rate. We like the sound of tracker mortgages and we would like to find another deal. I've had a look online and HSBC seems to have some pretty decent deals at + 2.29% for 70% LTV. However I am (perhaps irrationally!) concerned that when they carry out the house valuation, they'll value our house at les than the purchase price and therefore increase the interest rate because we'd be above 70% LTV. In the past, RBS have valued our house at £40,000 less than the sold price and thus forced us into an expensive deal. So my questions are:
1. how common is it for lenders to value at less than the purchase price and is it a sneaky way to get people onto more expensive rates? I do think the house we're buying is worth its price tag and it is in a very sought after area of East of England. It generated a lot of interest too but there aren't any similar houses that have sold recently in the area so Zoopla values it at £399,000.
2. Is HSBC a good lender in terms of handling times and efficiency?
3. Are we right in thinking that a low tracker is the best type of mortgage? We're not keen on the idea of remortgaging every few years.
4. Is the house valuation likely to be more accurate if we do a full survey with the lender as opposed to basic valuation?
Thanks in advance!
0
Comments
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Why don't you stay with the same lender and port the current tracker over to the first part of the new mortgage?
Then, you take the increased borrowing on one of the lender's new products to complete the full amount of the mortgage.
1. Not very on a purchase. No it isn't.
2. Popular products means strain on processing.
3. Entirely your choice based on your circumstances.
4. No difference. Lender does not see extended report, only basic valuation.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0 -
Thank you for your post. Very useful.
We are considering porting our existing mortgage and adding some extra at RBS' current rates.
If we decide to just take out a brand new mortgage, what are First Direct and HSBC like in terms of approval rates and speed?
Thanks!0 -
No idea. They don't accept business from brokers.I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.0
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