Shared equity mortgage and additional borrowing (Natwest)

michellej1980

I'm currently having issues with Natwest.

Five years ago I purchased my property under the government's HomeBuy Direct scheme, with an equity loan of 30%.

I now want to staircase and repay this loan in full but need to borrow more money from Natwest to do so. I had an inital meeting where they said yes I could borrow more and to go back when I knew exactly how much I needed to borrow.

The first step was to obtain an independent valuation which was done yesterday so I am awaiting the report that I will need to send to the HomeBuy agent.

I have a pretty good idea of how much I will need to borrow and I have my own savings that I will be using too. I called the mortgage department at Natwest today and was told that I can't take additional borrowing until I've repaid the equity loan! That's what I need it for! I promptly went into the branch, where nobody understands shared equity mortgages, (I believe they don't offer them anymore) to complain that they told me I could borrow more, knowing that it was a shared equity mortgage and exactly what I wanted to use the extra money for. Someone will get back to me but it sounds absurd. I am now wondering if the (rude) man on the phone earlier was confused and thought I had some kind of other loan with them that I wanted to repay. that I could understand.

Any ideas?

Also, the woman in branch said that they would have to do the valuation so the one I've paid for won't be sufficient. Will Natwest need a new valuation if I want to borrow more? The HomeBuy agent says it needs to be independent and that 'Valuations carried out for bank or mortgage purposes are not acceptable'. Then again, she also said I don't need a solicitor so clearly still has no idea about any of it.

Getting very stressed as I've paid for a valuation and a deposit for the solicitor that I've instructed. I don't want to do a partial redemption of the loan because all these costs will be incurred again. I've always been happy with the HBD scheme as i'd not have been able to get on the property ladder without it, but this is a nightmare.

libf

Would you consider switching lender? If so, find a good broker.

michellej1980

The HomeBuy terms seem to suggest that I am unable to switch lenders AND borrow more at the same time. No idea why. This is turning out to be even more complicated than I ever dreamt possible.:mad:

libf

Might be worth asking if that still applies if you're clearing the full loan, so presumably then you're no longer bound by their rules...

michellej1980

Thanks. Don't really want to have to change lenders as I will then have to pay early repayment charges and new arrangement fees etc. this is already proving expensive with valuations, solicitors and the homebuy agent's numerous 'admin fees'.


Anyway, I called back this morning, convinced the guy yesterday must be wrong. I got told it was fine and they did a soft credit check and said that was ok. I have an advisor calling me next week to make a formal application over the phone and then it will go to the underwriters for a decision, which I believe is the way it normally works.

Also, the advisor from the branch called and said he could help me. He was just going to do the same as what I've already arranged to do over the phone on Tuesday so I'm sticking with that. He did say that they would probably want to do another valuation which id have to pay for. Ridiculous as the amount I would owe them is a lot less than the property value even 5 years ago so they know damn well the property won't have dropped that much if at all.

So, things are looking up again but I think a complaint is in order after the incompetence they have demonstrated. The valuation I have just had done is only valid for 3 months so I hope the transaction can be completed in that time otherwise I'll have to pay out even more. Any idea how long the application should take?

frembrit

It's been a few months now, how did you get on? How long did it take you to complete the whole process. Any further info would be greatly appreciated. Thanks.

My 5 years is up next March and I've just been in to the Nationwide about borrowing more to pay off the full 30%, but I don't earn enough so they are about £10K short of the amount I've guessed it to be. (house not valued yet)

michellej1980

Hi there. There has been a delay because Natwest advised me to wait until I was eligible to change my deal at the end of my current fixed rate so that I could combine the extra borrowing with my existing mortgage and get a lower rate. I have a meeting next week at the bank to make the application.

The valuation I had done expires this week and I recently discovered that Homebuy will accept 'desktop valuations' which are valid for a further 3 months. However, it apparently takes them 6 weeks to process the redemption request and another 6 weeks to complete the transaction so I'm worried it will expire again and I'll end up paying for a brand new valuation! There are so many people involved in this process it's difficult to know how to time things! Don't know how long the bank application will take either. Good thing is that 2 flats in my block have recently been sold for less than mine was valued at so I may get away with paying a bit less back than I thought. :T

Good luck with yours. I'd start the ball rolling now if I were you...