Can we remortgage anywhere?

Akira

Hello, my husband and I, both 51, have been enquiring about remortgaging one of our properties to buy a holiday home, however, even though we own two properties, both without mortgages, and only want to borrow 100k, we cannot find anyone who would lend to us, due to us having credit cards and are still paying for our windows, which were bought on finance almost 10 years ago. My husband has his own business and we rent a property which would more than cover the monthly remortgage repayments. One broker said they'd try a place that'd charge us almost 7% interest, which is ridiculous! Has anyone been in this situation, and did you manage to remortgage, please? Any advice would be greatly appreciated. Thank you.

Thrugelmir

Akira wrote: »

we rent a property which would more than cover the monthly remortgage repayments.

If it's a holiday home where will you live?

Akira

We are going to continue to live in London.

cahillg81

So you own two properties out right and one of them is let?

ideally you would re-mortgage your let property assuming the rental income is going to cover the loan you take out.

Akira

That's what we wanted to do but we were told the interest rate would higher. We wouldn't mind paying a bit above the standard rate, but, even though half of the rent would cover the remortgage, we were told because we have some debts(just over 10k), we'd have to pay almost 7% interest. And we are planning to use some of the money to clear all the debts, so don't understand why it's a problem.

AnotherJoe

You have been paying for windows for ten years ? If you can't afford that much then why do you think you could afford to buy a house? Why haven't you paid the windows off and cleared the credit cards first ?

Akira

AnotherJoe, I never said I couldn't afford the Windows, or my credit cards, the windows are only £155 a month, and, as we just decided now to buy a holiday home and want to do it quickly, we thought the best thing would be to remortgage one of our properties, and pay all the debts as well as buying the place, in one go. What's wrong with that?

dobymicks

You could try phoning some banks and building societies.
Just ask them about their criteria.
Don't give up, it took me a good few days to find an interest only deal on an unencumbered property.
You will at least find out what you need to do to put yourselves in a position to lend.

Westminster

Akira wrote: »

AnotherJoe, I never said I couldn't afford the Windows, or my credit cards, the windows are only £155 a month, and, as we just decided now to buy a holiday home and want to do it quickly, we thought the best thing would be to remortgage one of our properties, and pay all the debts as well as buying the place, in one go. What's wrong with that?

Wow - you've already paid £18,600 on windows and they are not yet paid off .... were you glazing the Crystal Palace?

AnotherJoe

Akira wrote: »

AnotherJoe, I never said I couldn't afford the Windows, or my credit cards, the windows are only £155 a month, and, as we just decided now to buy a holiday home and want to do it quickly, we thought the best thing would be to remortgage one of our properties, and pay all the debts as well as buying the place, in one go. What's wrong with that?

Probably that the mortgage co doesn't wish to be a debt consolidation vehicle. They are meant to loan on property and not spending on credit cards which might be anything. There are also increased restrictions on BTL mortgages and wrapping debt consolidation into that most likely doesn't sit well with them compared to a year or more ago.

Why don't you pay these trivial amounts off and then you can (presumably) easily get a mortgage ? If they aren't trivial amounts maybe affordability is the issue.

catwoman73

It sounds like a combination of factors that count against you. Your age will limit the term with some lenders and hence affordability.

Your husband is self employed, which limits choice. How long has he been self employed, is his income all salary, or are there dividends as well, and what is your income?

You have longstanding debt - what is the interest rate on the windows and is this included in the £10k debt or is it additional?

You don't sound like you think very realistically about money to be honest, you talk about the windows payment being 'only' £155 pm and have been paying for them for 10 years - how much interest has this cost? Are the windows very specialist in a very big house? They sound extremely expensive.

Then you say you 'only' want to borrow £100k for the holiday home - where is it and how much do you expect to use it? Will you rent it out too, or do you want to keep it for yourselves/friends and family? What advantage do you see over just renting somewhere when you go on holiday?