Extending Nationwide Mortgage

pollyanna24

I've heard it's quite hard to extend the term of your mortgage rather than shorten it, but I wondered if anyone knew how hard it is to do with a Nationwide mortgage?

My term at the moment is 26years and I wish to extend by 5years (and at the same time do additional borrowing). It would just make it more affordable for the first years if they let me do this.

lee111s

It depends on your circumstances such as how old you are, how much you earn, what other debts you have etc.

TrickyDicky101

Is this Shared Ownership? That could be relevant.

pollyanna24

Not a shared ownership.

I own the house with my brother and wish to buy him out. That will mean additional borrowing of £100,000 (the calculators say I can do this).

No other debts and am 34 years old (well I be on Monday!)

pollyanna24

Is there any advantage / disadvantage to me extending the mortgage now (9 months before I tend to take on the mortgage by myself and take out additional borrowing)?

I've rung Nationwide and they are sending out some pack for us to sign and we have to go through the whole affordability thing again (strange as we are trying to get our payments lowered by extending the mortgage).

Can't see any problems with affordability as we are on combined income of £82,000 and mortgage is £108,000, but just wondered if anyone could see any potential problems in me deciding to do this now.

It's just one thing ticked off my list and rather than do everything next year, i.e. get term extended, take over mortgage myself and take on additional borrowing all at the same time, I'd rather get what I can out the way now.

Red-Squirrel_2

When you apply to buy your brother out, you will be applying for a whole new mortgage in your sole name, the existing one will end, so no point extending the term at this stage.

pollyanna24

Red-Squirrel wrote: »

When you apply to buy your brother out, you will be applying for a whole new mortgage in your sole name, the existing one will end, so no point extending the term at this stage.

I was told by Nationwide that I could do a transfer of equity for the existing mortgage (I did this when my brother bought my ex out of the property), then do additional borrowing at the same time.

But thank you, you have made me think further. Maybe I was given the wrong information and will ring Nationwide to clarify.

Red-Squirrel_2

pollyanna24 wrote: »

I was told by Nationwide that I could do a transfer of equity for the existing mortgage (I did this when my brother bought my ex out of the property), then do additional borrowing at the same time.

But thank you, you have made me think further. Maybe I was given the wrong information and will ring Nationwide to clarify.

I could be wrong, but I think that's how it worked when my ex bought me out a few years back. the existing mortgage account closed and a new one opened in just his name for the higher amount after all the usual checks. What the BS have told you is far more likely to be correct than what I tell you though.

If you extend the term now, you'll still have to pass all the affordability checks for the higher amount on your own 9 months down the line, so unless you need to reduce the payments right now, I can't see much benefit in going through the whole rigmarole twice, especially from your brother's POV!

pollyanna24

Red-Squirrel wrote: »

I could be wrong, but I think that's how it worked when my ex bought me out a few years back. the existing mortgage account closed and a new one opened in just his name for the higher amount after all the usual checks. What the BS have told you is far more likely to be correct than what I tell you though.

If you extend the term now, you'll still have to pass all the affordability checks for the higher amount on your own 9 months down the line, so unless you need to reduce the payments right now, I can't see much benefit in going through the whole rigmarole twice, especially from your brother's POV!

Thanks. When my brother bought my ex out, he didn't need to get another mortgage as he paid him with his savings, so this might make the difference here, not sure.

My brother won't be doing anything except giving me a payslip and bank statement, I always do the hard work, just like I did when he bought into the place, haha!

I suppose I want to do it now as I think if Nationwide won't extend the mortgage, I feel that the payments on the existing and the new mortgage will just be that little bit uncomfortable for me to do with 25 years, so would rather know now whether they will let me do it.

I figured if I already have the mortgage over 30 years next year, then it will just be a case of transferring the mortgage (as I did before) and then taking on additional borrowing.

TrickyDicky101

pollyanna24 wrote: »

Thanks. When my brother bought my ex out, he didn't need to get another mortgage as he paid him with his savings, so this might make the difference here, not sure.

My brother won't be doing anything except giving me a payslip and bank statement, I always do the hard work, just like I did when he bought into the place, haha!

I suppose I want to do it now as I think if Nationwide won't extend the mortgage, I feel that the payments on the existing and the new mortgage will just be that little bit uncomfortable for me to do with 25 years, so would rather know now whether they will let me do it.

I figured if I already have the mortgage over 30 years next year, then it will just be a case of transferring the mortgage (as I did before) and then taking on additional borrowing.

As far as I know it will be a full credit score and affordability calculation when you apply for the ToE and whether you have 25 yr or 30 yr term at time of application is not going to change that I'm afraid.

pollyanna24

TrickyDicky101 wrote: »

As far as I know it will be a full credit score and affordability calculation when you apply for the ToE and whether you have 25 yr or 30 yr term at time of application is not going to change that I'm afraid.

Thank you. I have done all the calculators and think that is as far as I can take it at the moment. The calculators indicate that I can borrow the amount I need.

I heard that it was harder to extend the term of a mortgage (not quite sure why) and it was just something I wanted to have in place for ease of mind. I would continue paying the 25 year amount until my I buy my brother out (by overpaying the small amount).