Advice Please Help

Josh_Milner

Some years ago my partner split with her husband leaving her with debt. They both have been very stubborn about this debt with neither of them paying, my partner went to money matters back in 2009 and they basically said the only way would of been going bankrupt which at the time with the advice she was given wouldn't of been a good idea as she thought she'd never getting any sort or credit, even a bank account back then in 2009.

This year with us both being in a much better situation financially we decided we would go for a joint mortgage and rent our home we live in out which is only mortgaged by myself so today we went and sat with a financial adviser for a residential mortgage which when asking if anyone has had a house repossessed my partner answered yes which at this point he could no longer help us both and advised she would of been better off if she went bankrupt in 2009 because he would of been able to help us today.

It might sound daft that we decided to go for a mortgage with my partners past debt but this was another thing she has not had contact with and collectors etc since late 2009 and after speaking with someone on finding her debt they seemed to think it was basically non existent so together we decided to go for it now or it would be never. lastly the adviser did offer me on my own 28k which wouldn't really buy us anything near a 3 bed house.

So the question is where do we go next in the steps of getting our 2nd mortgage or even just having a joint one in general ?

Any advice is much appreciated!!!

Thanks
Josh

rockm87

Hi Josh, can I ask, why is it so important to get a second mortgage if you already have one?

Playing_with_Fire_2

I think that the idea is to turn the existing mortgage into a buy-to-let or consent-to-let, and the mortgage application was for a new home which OP will then live in.

What is the value of the place you currently live in, what mortgage is outstanding and in what way does it not meet your current needs?

At the moment it seems like your partner won't be able to take out credit for the significant future. She may be able to do some work on this with help from the DFW board.

Is your mortgage portable if you wanted to sell the existing place and move to a new one? How much extra could you borrow (probably around the £28k the advisor said you could get on your own)? How close would this get you to your new place?

I would encourage you and your partner to save to increase your deposit, and then look to buy based on selling your current place and you continuing to have the mortgage in your name.

ASutton

hi Josh


Is your mortgage broker aware you plan to let your current property out?


I think you should firstly have your property valued for both rental and a sale value. Your mortgage advisor should then be able to use this forecasted rental income which I'm presuming will cover your mortgage. This should then able you to get a mortgage like you did in the first place, rather like a first time buyer. They will effectively overlook your current mortgage expenditure.


I have done this 3 times and will be doing it again once I have 2-3 years of tax returns after self employment. It is usually a lot easier and quicker to find tenants than find a buyer, therefore if you can save for the deposit, your current house becomes a useful long term asset.


You may even be able to borrow more than you could initially. I'm going back 7 years but after my first property I could borrow more than before it, on the same salary using my first property as an additional income. I found it pretty ridiculous as the money I could lend would of been unaffordable unless I went on a strict diet of beans. Obviously the banks affordability checks have changed a lot since then but I did exactly the same 2 years ago and managed to get another mortgage, whilst living in a third property.


Hope this helps

LJB290

So the mortgage advisor didn't even begin to process the application?
When was the house repossessed?
2009 is quite a long time ago now - do you know if the debts are still around and still enforceable?

I had a house repossessed about 1996/7 (that I knew nothing about until they came to me for the shortfall).
I have taken out several mortgages since then.

Depending on the year that the house was repossessed - is it not worth processing the application to see what the outcome is?