Adviser wants to go for AIP but we think we're not ready - thoughts?

phonerage

Hello

My partner and I recently contacted a (recommended) mortgage adviser to discuss our options for buying.

We have a mildly complicated situation which is why we wanted to explore options. (He earns very well, but solely owns a house in negative equity; I earn poorly but own my own flat outright; we both have not great job security and two little kids). Our credit rating is fine, but we have been overdrawn recently (January joy).

Anyway the broker didn't really want to discuss this and seems to just want to go straight into applying for a joint AIP.

Although this might tell us how much we could borrow and if we are acceptable for a loan, we don't think we're ready for that, because
a) we aren't sure if we can, or if we should, go for a single mortgage or a joint one
b) my partner is still in an (agreed) overdraft, not due to be paid off for some months, which surely will count against us?
c) we have the negative equity house to sell before we can buy somewhere else and it's going to be a hard one to shift and may take some time

I don't want to go for a pointless AIP and potentially damage our chances.

My gut feeling is that we should just hold off and if the broker isn't interested in advising but only in doing an AIP maybe he's not the right person to help us.

Or am I talking nonsense and expecting the wrong things?

Thoughts appreciated.

S

ACG

It does seem like an AIP at this stage is pointless as you could be a month or 6 away from applying.

You do not need an AIP to see what you can lend, the affordability calculators can do that.

Have you discussed this with your broker? If you are not happy at this stage with them, it probably is a good idea to find one you are happy with.

amnblog

You are the client. You are ready when you are ready - not before.

Thrugelmir

Are you living in the house (that's in negative equity) ?

phonerage

Thanks for the replies, I feel a bit clueless and therefore not confident about what to do!

No, I don't live in the negative house. Why do you ask?

Thanks!
S

Thrugelmir

I did mean both of you.

I asked because resolving the issue of the negative equity has to be addressed. Logically the solution would be to sell the flat first and move into the house. This then gives you the equity to clear the deficit and fund the move to a new property. With a Declaration of Trust you could protect your own interests. By taking the first £x of the property's equity if it were to be sold. £x being the equity you use to clear the negative equity and deposit you put into the new property.

phonerage

Thanks - after talking it round that was the conclusion we had just reached over dinner. Good to hear it from elsewhere!



S