Named on an existing mortgage

BSB1986

Hi all

I have a question which I hope someone can answer....

I am currently named on a mortgage jointly but want to now buy my own house and move out.

I have spoken to a mortgage company and they have offered me a mortgage but have told me they won't take into account the existing mortgage because they don't expect me to be paying for it after I move out... so happy days....

I spoke to another advisor at a different company and they have told me it will be an issue unless I get my name removed off the existing mortgage and that the offer will most likely change or be declined by the initial company when it goes through to the underwriter. I have since called back and asked the question and they assure me it won't be an issue.

I'm confused and have no idea who is right or wrong or what to do, anyone got any advice?


Thanks in advance

ACG

Different lenders = different views.
Its not uncommon for that to happen. Some lenders accept 100% of bonuses, others do not. Some accept tax credits, others do not. The same goes for retirement ages etc etc.

kingstreet

Unless the mortgage is on a self-financing let property, I'd be surprised at any lender which ignored the existing mortgage.

Most lenders will take it into account in some way, with the best probably being the monthly payment being added like a credit commitment to ensure the new mortgage remains affordable even if you suddenly ended up having to pay the old one as well - which is possible, BTW,

If the first lender has done this and it has no impact on what you want to borrow, the impression may be given that it's being ignored, when "it's being taken into account" would be a more accurate description.

Thrugelmir

BSB1986 wrote: »

I have spoken to a mortgage company and they have offered me a mortgage but have told me they won't take into account the existing mortgage because they don't expect me to be paying for it after I move out... so happy days....

If you are then the game changes. As you are jointly and severally liable for the existing debt. Not a case of simply walking away.

BSB1986

Hi

Thanks for your replies thats why i am being cautious i keep getting told different things and i really dont want to be in a position where i put an offer down and then get told that the initial offer doesn't stand or there are issues etc.

I have since called them back and spoke to 2 or 3 different people and they keep assuring me that it will be fine, im still not convinced, i will proceed with what they have offered and let you know how i get on.

If theres any more advice please let me know.

Thrugelmir

Are you planning on removing yourself from the existing mortgage?

rushandy

I've just recently taken out a second mortgage (for a different property) and plan to keep both first and second mortgages running. Spoke to the bank about it up front, they didn't seem too concerned.

I guess it just comes down to how affordable the bank thinks it is for you.

BSB1986

Thrugelmir wrote: »

Are you planning on removing yourself from the existing mortgage?

Ive heard its a long process and that the existing applicants have to be reassessed etc etc, so if I can I would like to stay on just to keep things simple, but I guess if its going to cause an issue with my new property I may have to have it removed.

BSB1986

rushandy wrote: »

I've just recently taken out a second mortgage (for a different property) and plan to keep both first and second mortgages running. Spoke to the bank about it up front, they didn't seem too concerned.

I guess it just comes down to how affordable the bank thinks it is for you.

Yeah I think I may just leave things as they are and see what happens be up front with the lender and see what they say.


Thanks for the replies will let you know how I get on, just need to find something I like now! :think:

ethank

You will continue to be jointly liable for the first mortgage. If they don't pay the mortgage - they can come after you.