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Help to Buy lending
Wisdom123
Posts: 26 Forumite
Hi there,
After discussions with leading broker a while back I was informed the banks will lend you less for a HTB home than normal purchase (4 times salary rather than 4.5 if I recall correctly). I can't see anything online to suggest this is the norm.
I'm just querying what the reason would be for lending less?
Thank you.
After discussions with leading broker a while back I was informed the banks will lend you less for a HTB home than normal purchase (4 times salary rather than 4.5 if I recall correctly). I can't see anything online to suggest this is the norm.
I'm just querying what the reason would be for lending less?
Thank you.
0
Comments
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Its not true.
However lenders do tend to assess affordability stricter than non help to buy.
Natwest I seem to recall they used to assess help to buy on a standard rate of 7% where as non help to buy was 6% (or similar). Woolwich did something similar as im sure do other lenders.I am a Mortgage AdviserYou 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.0 -
HTB - Equity Loan on a newbuld, or HTB - Mortgage Guarantee on a second-hand property?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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My reply was based on the mortgage guaranteekingstreet wrote: »HTB - Equity Loan on a newbuld, or HTB - Mortgage Guarantee on a second-hand property?
Every day is a school day on this site.I am a Mortgage AdviserYou 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.0 -
kingstreet wrote: »HTB - Equity Loan on a newbuld, or HTB - Mortgage Guarantee on a second-hand property?
Apologies for delay...been on hols
HTB equity loan0 -
I can understand why they would be harsher on HTB EL because you do have this extra debt that you are going to want to pay off at some point and the interest does go up every year.
The HTB MG is just a standard mortgage you pay back the whole thing over the life of the mortgage. So if you can afford the repayments at the start you are probably okay because your LTV will come down even if rates go up (excluding huge rate rises)Changing the world, one sarcastic comment at a time.0 -
Some lenders use no more than 4.5 x income on HTB - EL and the HCA's affordability calculator uses 4.5 x as well.
The assumes mortgage rate on the HCA calculator is 4.8%, so often the lender calculator output is higher than the Government would allow anyway.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 -
Thanks. Makes more sense now.0
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