Guarantor - disclose to own mortgage co?

Pricivius

I have a quick question I am hoping someone can help me with.

I currently am looking to buy a property with my partner. I also have a mortgage on another property which is on the market but may take some time to sell.

My brother is hoping to get a mortgage but would need me to be his guarantor.

If I agreed to be his guarantor, would I:

A. Have to get consent from my current mortgage company? If so, are they likely to refuse or will this all depend on salaries, LTVs etc...?

B. Have to inform my new mortgage company when applying for my new joint mortgage with my partner? Is this likely to reduce what they would let us borrow?

Please let me know if you need any further details and thanks in advance for any advice you can offer.

holly_hobby

Yes you must disclose, the mge commitment will be included in your own affordability assessment (so will reduce what you can borrow), as if your, Bro defaults his lender will come to you for payment, as in being guarantor you are essentially legally responsible for servicing.

I personally wouldn't go down the gtor route for this reason.

Hope this helps

Holly

tinkerbell28

By being guarantor, you will be in effect classed as having 3 mortgages.

The one on your property to sell, the new one you're applying for and his.

Yes it will need to be disclosed to your mortgage provider. As one it will affect LTV'S. Plus if he were to default, then it would appear on your credit file too and they would be coming after you for the debt.

I'd think very carefully.

Pricivius

That makes sense - thanks for confirming.

I was reluctant anyway, but I can't have it impacting on my purchase and home ownership so I'll have a re-think.

Thanks again.