New mortgage first time buyer

Nicky321

My daughter and son in law have just been approved for their first mortgage. Just wondered if anyone can help with a few questions they ask?

House their looking at is £99995.00 and they have been approved for a mortgage with TSB for £90000.00. They have nearly £20000.00 deposit, but need to do quite a bit of improvements to the house. The house is all electric so they will need to get gas to the property and have central heating.

Questions are:-

Would the mortgage lender still lend them £90000?
What fees are they looking at?
What rate (with TSB)?

Thanks in advance xx

amnblog

Why are they not simply asking TSB?

David_White

If they've been approved with TSB surely they've told them what the rate and fees are?

Nicky321

amnblog wrote: »

Why are they not simply asking TSB?

They got the mortgage offer through a mortgage adviser not through the bank, and because they where so excited they forgot to ask. They rang back for something, and dont wanna ring back again.

Nicky321

I asked on here on their behalf because I thought I may have got the answers

Thrugelmir

There may be a good reason why there's no gas connection to the property.

Nicky321

Thrugelmir wrote: »

There may be a good reason why there's no gas connection to the property.

The reason to no gas connection is because all the houses on the estate buit in the 70's where built as electricity connection only with the electric storage heaters. Now most properties have had gas connected.

Contemptuous

Nicky321 wrote: »

Questions are:-

Would the mortgage lender still lend them £90000?
What fees are they looking at?
What rate (with TSB)?

Thanks in advance xx

1. Yes, subject to valuation and credit score - TSB go up to 95% LTV and they'd be asking for just over 90%.

2. Valuation fee. Product fee possibly.

3. Have you checked the TSB website? All the rates for the 90-95% LTV bracket would be available to view there.

Wake_up_call

Given that gas is so much more expensive than electricity, I'd love to have a home that was all-electric.

If they put £9995 down as the deposit, they could still borrow 90,000 as they'd be at 90% LTV.

Fees etc vary and those questions should be asked of TSB, but a quick browse of their website tells me that their typical product fees range between £0 and £995.

As the borrowing is below 100k, a rule of thumb is to avoid high product fees if taking a short-term deal.

For example, the difference between TSB's 2.79% two year deal with a £995 fee and it's fee-free 3.19% on £90,000 over a 25 year term is only £18 a month.

Times that by 24 months = £432. There's no point paying £995 to save £432. Hope that makes sense.

They will have solicitors and valuation fees on top.

kingstreet

Nicky321 wrote: »

Questions are:-

Would the mortgage lender still lend them £90000?
What fees are they looking at?
What rate (with TSB)?

Thanks in advance xx

We don't know what the lender will lend until the valuation is done and the extent of any essential repairs is made clear. That will also determine the valuation in current condition and valuation after essential repairs are done.

Fees vary from product to product, lender to lender and solicitor to solicitor. They need to ask for personalised illustrations/quotations from the parties they have appointed to act for them.

Again, they will have a choice of fixed rates and trackers, with and without fees. It is impossible to say. They should ensure they have printed illustrations for consideration BEFORE they make any decision on a mortgage lender/product.

Caz3121

Wake_up_call wrote: »

If they put £9995 down as the deposit, they could still borrow 90,000 as they'd be at 90% LTV.

...assuming the mortgage valuation is £99,995

there have been a number of recent threads re mortgage valuations
If for example they want to pay £99,995 and the property is valued at £90k, they will not be able to get £90k mortgage, the amount loaned would be less as the LTV is based on whichever is lower between purchase price and valuation