Mortgage broker - ask me anything

Cerumol

I currently own a property with a value of around 1 million in the Uk with an equity release loan of 60K outstanding.

I am trying to do a few things and looking for some help about whether there is any way to do this.

My son and his family already live in the property and would like to take some ownership of it, and in doing so release capital for me. They do not have the cash capital to do this directly.

I also wish to take a residency abroad and as part of this process, I wanted to transfer ownership of the house in the UK to my three children. Is there any way to do this? Does the original equity release loan need to be repaid or came it be transferred to my son and potentially increased. Would all my children need to be involved in any equity release loan. Can my son take on an equity release on the percentage he would own if I transfer ownership.

It feels like a complicated process so any guidance would be appreciated. Wondering if there would be any suitable products on the market to look at?

K_S

Cerumol said:

I currently own a property with a value of around 1 million in the Uk with an equity release loan of 60K outstanding.

I am trying to do a few things and looking for some help about whether there is any way to do this.

My son and his family already live in the property and would like to take some ownership of it, and in doing so release capital for me. They do not have the cash capital to do this directly.

I also wish to take a residency abroad and as part of this process, I wanted to transfer ownership of the house in the UK to my three children. Is there any way to do this? Does the original equity release loan need to be repaid or came it be transferred to my son and potentially increased. Would all my children need to be involved in any equity release loan. Can my son take on an equity release on the percentage he would own if I transfer ownership.

It feels like a complicated process so any guidance would be appreciated. Wondering if there would be any suitable products on the market to look at?

@cerumol I think the first thing you need to be clear on is the penalty for getting out of your current equity release product. On older products, I've seen horrendous ERCs (early repayment charges) of ~20% of the initial borrowing. If it was taken out more recently it might be more reasonable and tapered but still potentially substantial single digit percentages.

I doubt it'll be possible for your son to 'take over' the equity release product.

Candy0107

Hi,
Bit of an odd question (cant see that it has been asked before).  I'm hoping to apply for a mortgage in about 2 years (currently saving for a deposit).   I have an account with natwest (main bank account where my salary gets paid, DD's etc).  I have a spending account with Monzo (for coffee, lunch, odds n end etc).  I regularly spend a couple of quid on the lottery and placing the odd bet - I dont have a problem with gambling, i can afford the cash.

When I apply for a mortgage, will lenders want to see both accounts or my DD/salary account?
Thanks in advance x

Rosemary1982

Hello!  To cut a long story short we have been declined a mortgage in joint names from santander (offer receiving a formal offer (see other thread)).  We believe this has something to do with my husbands Limited business (although we were only using his second income on PAYE for mortgage).  I am now trying t port my exisiting mortgage with natwest to new property which is in just my name but now I am worried that natwest will decline the port due to being financially linked with my husband (only just as the recent santander application was the only time we have applied for credit together).  I am a PAYE employee in a good job, could natwest decline my sole mortgage due to my husband's limited business (further info, he has taken out a bounce back loan to get the business through the pandemic.) Thanks in advance....

K_S

Rosemary1982 said:

Hello!  To cut a long story short we have been declined a mortgage in joint names from santander (offer receiving a formal offer (see other thread)).  We believe this has something to do with my husbands Limited business (although we were only using his second income on PAYE for mortgage).  I am now trying t port my exisiting mortgage with natwest to new property which is in just my name but now I am worried that natwest will decline the port due to being financially linked with my husband (only just as the recent santander application was the only time we have applied for credit together).  I am a PAYE employee in a good job, could natwest decline my sole mortgage due to my husband's limited business (further info, he has taken out a bounce back loan to get the business through the pandemic.) Thanks in advance....

@rosemary1982 Sorry to hear about the post-offer decline from Santander. My thoughts -

- there's nothing in your post to suggest that Natwest would look unfavourably upon your porting application. But of course, that view is based on the limited info I have.

- are you intending to add any cash at all while porting? If yes, will any of it come from your husband or his business?

- I would recommend getting in touch with a broker even if the plan is to port the mortgage. They can look at the whole picture to see if there is anything that might cause an issue with Natwest and then handle the porting process for you.

DTMT

Hello, I'm thinking of applying for a mortgage for my first home but my credit score is low. its 402 points on clearscore and im worried it will get refused.
I've read repeatedly on here that your credit score doesn't matter and its all about my credit history.
I have a default which is over 5 years old and was settled in 2016, it was for £50
I did take out quite a few payday loans but all over 2 years ago and were all paid back on time.
Apart from that i haven't missed and payments in over 2 years.
i do have £4000 in credit card debt which I'm paying off but i don't have any other debt.
i joined the electoral roll a few months ago if that makes a difference.  
what do you think my chances are?

K_S

DTMT said:

Hello, I'm thinking of applying for a mortgage for my first home but my credit score is low. its 402 points on clearscore and im worried it will get refused.
I've read repeatedly on here that your credit score doesn't matter and its all about my credit history.
I have a default which is over 5 years old and was settled in 2016, it was for £50
I did take out quite a few payday loans but all over 2 years ago and were all paid back on time.
Apart from that i haven't missed and payments in over 2 years.
i do have £4000 in credit card debt which I'm paying off but i don't have any other debt.
i joined the electoral roll a few months ago if that makes a difference.  
what do you think my chances are?

@DTMT I wouldn't worry too much about the Clearscore 'credit-score' as such.

- one 5+ year old £50 default is not likely to be a huge issue

- the persistent use of payday loans (and how they were conducted) may have an impact depending on how it comes across in the credit report

- clean credit history for the last 2 years is a definite positive

Generally speaking, you should have options. Beyond that I can't really say a lot about your chances as that will depend on the specifics and a lot of other factors as well such as size of deposit, kind of income, how much you are looking to borrow, etc.

swtchick87

Still undergoing underwriting from barclays. We used a broker. My husband is employed but has a self employed job too, hence use of a broker. Its been nearly 3 weeks since we corresponded. No update. Shall i call barclays? 

K_S

swtchick87 said:

Still undergoing underwriting from barclays. We used a broker. My husband is employed but has a self employed job too, hence use of a broker. Its been nearly 3 weeks since we corresponded. No update. Shall i call barclays? 

@swtchick87 Tbh, 3 weeks is not too long at all when there's self-employed income in the mix and Barclays doing the processing. But if your broker isn't giving you an update, no harm in calling Barclays to see if they'll tell you anything more.

swtchick87

K_S said:

swtchick87 said:

Still undergoing underwriting from barclays. We used a broker. My husband is employed but has a self employed job too, hence use of a broker. Its been nearly 3 weeks since we corresponded. No update. Shall i call barclays? 

@swtchick87 Tbh, 3 weeks is not too long at all when there's self-employed income in the mix and Barclays doing the processing. But if your broker isn't giving you an update, no harm in calling Barclays to see if they'll tell you anything more.

Thanks for the response. The application was submited end of November, with a hard search on the 24th Nov. 3 weeks ago was the last submission of additional docs. Is this reasonable?