Mortgage broker - ask me anything

pinkcloud17

If a lender reduces their lending based on a change of circumstances (post-offer) and therefore the LTV needs to be changed, does this generally mean applying for a new product from scratch or can the existing offer just be amended and therefore the interest rate already secured will remain?

K_S

@pinkcloud17 I'm not sure what you mean. If the lender comes back with a reduced offer, that'll already have a product, interest rate etc on it.

pinkcloud17

K_S said:

@pinkcloud17 I'm not sure what you mean. If the lender comes back with a reduced offer, that'll already have a product, interest rate etc on it.

Sorry, I mean if you already have an offer in place, but then you need to inform the lender of change of circumstances and they then come back to you and say they want to reduce the lending, but you were already borrowing the maximum amount they offered in the first instance. You therefore need to increase your deposit to make it up to the purchase price. In this case, do they just simply amend the offer you already had in accordance with an increased deposit/ decreased loan so the interest rate remains the same and your monthly payments are reduced? Or do you have to start again because all of the figures are now different? Because I thought if your LTV changes then the interest rates/ products are different. 

K_S

pinkcloud17 said:

K_S said:

@pinkcloud17 I'm not sure what you mean. If the lender comes back with a reduced offer, that'll already have a product, interest rate etc on it.

Sorry, I mean if you already have an offer in place, but then you need to inform the lender of change of circumstances and they then come back to you and say they want to reduce the lending, but you were already borrowing the maximum amount they offered in the first instance. You therefore need to increase your deposit to make it up to the purchase price. In this case, do they just simply amend the offer you already had in accordance with an increased deposit/ decreased loan so the interest rate remains the same and your monthly payments are reduced? Or do you have to start again because all of the figures are now different? Because I thought if your LTV changes then the interest rates/ products are different. 

@pinkcloud17 If the lender is still happy to lend, albeit at a lower amount, usually it'll just mean that a revised offer with the new lower amount is issued with the same product.

If the lending amount goes down sufficiently to take you to the next lower LTV band, the bank doesn't mind if your product is in a higher LTV but you may be paying more than necessary. In that case, your broker should be able to choose a new product. Whether this will be subject to further review is hard to say for sure.

pinkcloud17

K_S said:

pinkcloud17 said:

K_S said:

@pinkcloud17 I'm not sure what you mean. If the lender comes back with a reduced offer, that'll already have a product, interest rate etc on it.

Sorry, I mean if you already have an offer in place, but then you need to inform the lender of change of circumstances and they then come back to you and say they want to reduce the lending, but you were already borrowing the maximum amount they offered in the first instance. You therefore need to increase your deposit to make it up to the purchase price. In this case, do they just simply amend the offer you already had in accordance with an increased deposit/ decreased loan so the interest rate remains the same and your monthly payments are reduced? Or do you have to start again because all of the figures are now different? Because I thought if your LTV changes then the interest rates/ products are different. 

@pinkcloud17 If the lender is still happy to lend, albeit at a lower amount, usually it'll just mean that a revised offer with the new lower amount is issued with the same product.

If the lending amount goes down sufficiently to take you to the next lower LTV band, the bank doesn't mind if your product is in a higher LTV but you may be paying more than necessary. In that case, your broker should be able to choose a new product. Whether this will be subject to further review is hard to say for sure.

That makes sense, thank you!

Adam555_2

Hi, I'm wondering if I'm wasting my time applying for a mortgage at the minute? Hopefully you can give some insight.
Heres my current circumstances-
Me and my wife are both self-employed owners of cafes, as you can imagine things have been very stop-start this year with all the current restrictions. We were hoping to move to a bigger house in the summer but after looking online it looks as though this may be difficult? We have 50% LTV.

K_S

Adam555_2 said:

Hi, I'm wondering if I'm wasting my time applying for a mortgage at the minute? Hopefully you can give some insight.
Heres my current circumstances-
Me and my wife are both self-employed owners of cafes, as you can imagine things have been very stop-start this year with all the current restrictions. We were hoping to move to a bigger house in the summer but after looking online it looks as though this may be difficult? We have 50% LTV.

@adam555_2 Imho, at the very least the country will need to get past the stage of lockdowns for underwriters to consider income from businesses that are directly impacted.

I have a similar case from a self-employed driving instructor who only needs a small loan at a low LTV but the lender asked that I come back after the current lockdown has ended and driving classes are allowed to go ahead.

Just to be clear, these are just general thoughts based on the limited info in your post.

IAMIAM

Nationwide specific, I am due an offer from them.
Can I just clarify - they state that the maximum age for the term is 70 but then they say it can be 75 on their website - how does this work?
Lastly, I have gone for a tracker with a view to transferring to an existing customer fixed rate a month after completion, will this be allowed as there is a near 1% rate difference and I do not want to be stuck on the tracker....I rang and they said it would be fine, I just do it online, but I'm not convinced!

K_S

IAMIAM said:

Nationwide specific, I am due an offer from them.
Can I just clarify - they state that the maximum age for the term is 70 but then they say it can be 75 on their website - how does this work?
Lastly, I have gone for a tracker with a view to transferring to an existing customer fixed rate a month after completion, will this be allowed as there is a near 1% rate difference and I do not want to be stuck on the tracker....I rang and they said it would be fine, I just do it online, but I'm not convinced!

@IAMIAM If want to take it past 70, you will need to prove post-70 income (pension projections, etc) to meet the affordability requirements. And then they will consider it.

Without commenting on your specific situation, I'd take Nationwide at their word, what else can you do. If they say it's not ok when you try to do it, complain citing what they told you.

Liyana89

Hi
I have very recently secured a permanent full time job, and saved up enough for a sizable deposit. In the past, I’ve worked 1 full time job, which I then had to quit due to my relative becoming unwell. Since caring for my relative, I’ve worked for agencies whenever I’ve been able to. 

As I’ve now got a permanent full time job, which I intend to stay in (as I’m not caring for relative any longer) will I be asked about my Past employment history when applying for mortgage? Or do they only focus on the present situation?

I’d be very grateful for help! Thanks a lot