Switching mortgage deal (Halifax) on Help to Buy

lor42x

We're coming to the end of our 2 year fixed rate deal with Halifax having bought our house with Help to Buy in 2013.

We'd like to look at our options for switching but would like to know if they'll run full credit checks again when it's not a full mortgage application? Does anyone have any experience of this? Have tried calling them but end up on hold for ages...

Any help appreciated

libf

If you change lender, or change the terms of the mortgage with the same lender, then it's a full check.

If you take a deal from the same lender without changing terms then usually there's no checking.

lor42x

By changing terms would that be asking to borrow more / change time period?

Sorry for what's probably a simple question, first time we're having to do this so a little lost!

libf

Yep, that's the kind of thing. In your case if you wanted to re-pay some of the Help To Buy loan than that would mean a re-assessment of your circumstances.

Some lenders also don't do re-mortgages on Help To Buy, so that may limit your options.

http://www.telegraph.co.uk/finance/personalfinance/borrowing/mortgages/11486639/Help-to-Buy-equity-loan-borrowers-face-rate-traps.html - Halifax seem fairly reasonable according to this.

lor42x

Yes I managed to speak to someone a while ago and they said if we're just looking to move to a new deal it's fairly simple (I didn't think to ask re checks when I had an actual person!!)

Housing Options Plus (post sales for Help to Buy) are also a real nuisance, I've asked re process for switching to a new deal with the same bank but they keep telling me about remortgaging which in Halifax' world is a different process!

It's a real pain because I don't want to instruct a solicitor unnecessarily. Halifax advised that a solicitor isn't normally needed for switching but can be needed for remortgaging. HOP say a solicitor is needed for remortgaging but no clarity on switching!

Here's hoping I finally get hold of a mortgage advisor

libf

Do you even need to tell the Help To Buy agent if you're staying with Halifax? The charges on the property will remain the same but I guess the rate is different so they might want to check affordability... Only just applying for Help to Buy myself so although I've been keeping an eye on news stories I'm not totally up on the processes. Good luck.

kingstreet

A new product with the same lender is not a remortgage, so HOP doesn't have to be involved.

If you do want to remortgage, that means a new mortgage with a new lender, you would need to obtain a deed of postponement from HOP if the equity loan is to remain in place.

lor42x

Fab! I hoped this was the case however HOP have that many processes & rules it's easy to get confused. Last thing I want to do is make a change and then be caught out! But equally I don't want charges from HOP (£115 admin charge for the pleasure) and potentially a solicitor just to switch to a new deal with the same provider.

kingstreet

It's somewhat disquieting the body with the Government contract to handle post-sales issues on HTB and the other shared equity schemes doesn't know the difference between a customer retention product from existing lender and a remortgage.

The latter, as it's name suggests, requires a change of mortgage deed, the security which ties the homeloan to the security property which obviously needs a solicitor to handle effectively.

The former needs no such change.

lor42x

Thanks kingstreet - really helpful advice from you

Agree it's disappointing that the body that should make things abundantly clear don't. I've waited weeks for a response to an email query and the phone lines are only open for short periods of time which is daft seeing as they're likely to be inundated with customers reaching the end of 2 year fixed deals...

lor42x

Interestingly just looked back on HOP guidance (myfirsthome website, can't post link) and in their words...

Remortgaging is the term used when you would like to switch mortgage lender or mortgage deal without increasing your borrowing. If you want to remortgage, you'll need our consent.

So in other words can't make a single change without their consent