Mortgage broker - ask me anything

IAMIAM

K_S said:

IAMIAM said:

Are there any buy to let lenders who do 75% LTV or maybe 80% LTV interest only, with option to switch between interest and repayment when wanted? Also does it make a difference if you have a BTL mortgage and return to Iive in the property for a while (12-18 months) then return to letting it out in terms of the lenders view and being on a BTL Mortgage vs Residential?

@iamiam I don't know of any lenders who offer a seamless option to switch between i/o and repayment. 

Under the terms of a BTL mortgage, you're not supposed to occupy the property. But assuming we're talking about BTL properties in your personal name (not ltd co), you can remortgage to resi if you need to move back in.

Yeah, BTL in personal name, but if I return for a year or two midway through a 5 year fix

ARxo

Looking for abit guidance on what to do;

My partner just completed on a 2 year 95% mortgage (offer was produced december 2019) on a flat worth £147k, our circumstances have now changed and we are looking to purchase a house towards the end of the year. 

Ideally looking to keep the flat however stuck between porting the mortgage onto the house or apply for CTL on the flat, then re-mortgaging to a BTL when the two year fix is up and paying a chunk off to get within 75% LTV?

I am a FTB in Scotland, we wont be using FHF or anything as my partner will still have a property on completion. I am aware we will need to pay stamp duty, how much roughly would this be? We would be looking at a house around the £240k. 

K_S

IAMIAM said:

K_S said:

IAMIAM said:

Are there any buy to let lenders who do 75% LTV or maybe 80% LTV interest only, with option to switch between interest and repayment when wanted? Also does it make a difference if you have a BTL mortgage and return to Iive in the property for a while (12-18 months) then return to letting it out in terms of the lenders view and being on a BTL Mortgage vs Residential?

@iamiam I don't know of any lenders who offer a seamless option to switch between i/o and repayment. 

Under the terms of a BTL mortgage, you're not supposed to occupy the property. But assuming we're talking about BTL properties in your personal name (not ltd co), you can remortgage to resi if you need to move back in.

Yeah, BTL in personal name, but if I return for a year or two midway through a 5 year fix

@iamiam You won't be able to do that without breaking the t&Cs that you signed up to or remortgaging to a resi (and paying the ERC to get out of the 5 year fix).

annetheman

Hi @K_S and other brokers - thanks for all of your help in this thread, amazing work!
If I added product fee to the mortgage and have not yet exchanged post offer, would it be possible to pay the "Product switch fee" of £30 to change from a 5 year fix to a 2 year fix if the LTV is still the same, property is still the same, my circumstances are still the same (no new credit or change in income/outgoings) with Kent Reliance?

Thank you so much!

[Deleted User]

ARxo said:

Looking for abit guidance on what to do;

My partner just completed on a 2 year 95% mortgage (offer was produced december 2019) on a flat worth £147k, our circumstances have now changed and we are looking to purchase a house towards the end of the year. 

Ideally looking to keep the flat however stuck between porting the mortgage onto the house or apply for CTL on the flat, then re-mortgaging to a BTL when the two year fix is up and paying a chunk off to get within 75% LTV?

I am a FTB in Scotland, we wont be using FHF or anything as my partner will still have a property on completion. I am aware we will need to pay stamp duty, how much roughly would this be? We would be looking at a house around the £240k. 

It’s not stamp duty in Scotland, it’s Land and Building Transaction Tax. If your partner keeps the current property then the additional dwelling supplement will apply meaning your LBTT bill will be £9600 when buying a £240,000 property. 

ARxo

Lover_of_Lycra said:

ARxo said:

Looking for abit guidance on what to do;

My partner just completed on a 2 year 95% mortgage (offer was produced december 2019) on a flat worth £147k, our circumstances have now changed and we are looking to purchase a house towards the end of the year. 

Ideally looking to keep the flat however stuck between porting the mortgage onto the house or apply for CTL on the flat, then re-mortgaging to a BTL when the two year fix is up and paying a chunk off to get within 75% LTV?

I am a FTB in Scotland, we wont be using FHF or anything as my partner will still have a property on completion. I am aware we will need to pay stamp duty, how much roughly would this be? We would be looking at a house around the £240k. 

It’s not stamp duty in Scotland, it’s Land and Building Transaction Tax. If your partner keeps the current property then the additional dwelling supplement will apply meaning your LBTT bill will be £9600 when buying a £240,000 property. 

Great, thanks for confirming!

K_S

annetheman said:

Hi @K_S and other brokers - thanks for all of your help in this thread, amazing work!
If I added product fee to the mortgage and have not yet exchanged post offer, would it be possible to pay the "Product switch fee" of £30 to change from a 5 year fix to a 2 year fix if the LTV is still the same, property is still the same, my circumstances are still the same (no new credit or change in income/outgoings) with Kent Reliance?
Thank you so much!

@annetheman Congrats on the KR offer very happy for you! Sorry I can't recall KR's process exactly but (from the broker's end) switching to a cheaper product post-offer is fairly straightforward for a lot of lenders and involves no repeat underwriting, etc.

K_S

ARxo said:

Looking for abit guidance on what to do;
My partner just completed on a 2 year 95% mortgage (offer was produced december 2019) on a flat worth £147k, our circumstances have now changed and we are looking to purchase a house towards the end of the year. 

Ideally looking to keep the flat however stuck between porting the mortgage onto the house or apply for CTL on the flat, then re-mortgaging to a BTL when the two year fix is up and paying a chunk off to get within 75% LTV?

I am a FTB in Scotland, we wont be using FHF or anything as my partner will still have a property on completion. I am aware we will need to pay stamp duty, how much roughly would this be? We would be looking at a house around the £240k. 

@ARxo If you want to keep the flat as a rental and you don't have the cash to bring down the LTV to consider a BTL remo, your only option to be able to let it is a CTL. Lenders often have a LTV ceiling beyond which they will not give a CTL and a minimum period on the new mortgage before you can request for one.

Having the flat in the background on a CTL will negatively impact your partner's borrowing on the new house purchase.

greenpanda

What do you think of Aldershot? Our buyers are using them and it's coming up to 2 months and they still don't have their mortgage. 

If they do get approval, are funds released in a timely manner?

Smifthy1234

K_S said:

@smifthy1234

1) There might be specialist lenders (in the UK or Spain) to release equity from the Spanish property but its likely to be a costly endavour.

2) Afaik, you are no longer an FTB as per the government definition as it's "an individual who has never owned an interest in a residential property in the UKingdom or anywhere else in the world" so you probably aren't eligible for schemes such as Help2Buy, etc. and liable to pay the 3% (assuming England) stamp duty surcharge.

Going by the limited info in your post and the numbers you've shared, you *should* be able to borrow in the region of 100-110k. But with a 10% deposit, at present the choice of lenders/products will be limited.

Great info - thank you! Again I know I've given you limited info so understand you cannot say for certain but .... do you feel it would be better to try and free up say £30k from the property in Spain? If had that much equity I hope I would have better mortgage options and lenders would see me more favourably? Sorry if thats an obvs question / answer!! 
Thanks again for your help.