Mortgage broker - ask me anything

HamSoulo

K_S said:

HamSoulo said:

Hi, is it true that childless couples get better mortgage deals than one with a child/children?

@hamsoulo Not quite. A couple with no dependents *may* have a higher max borrowing than a couple that do.

As per lender calulcations, the number of dependents (and associated costs such as childcare) may bring down your affordability and affect how much you can borrow.

Thank you @K_S
It makes sense and is in line with what I heard.
I appreciate that the affordability calculation has many variables and will differ on case to case basis, but if we were to ballpark the income multiplier for someone with excellent credit history- how much does it come down if there is a dependant- from 5x to 4.5x or lesser?

kingstreet

Open up a lender's online affordability calculator. Complete it with and without dependents and note the difference in the outputs. It's not as crude as a reduction in income multiple, which is largely used for income-capping at high loans to value these days.

BettyVob

K_S said:

BettyVob said:

Shared ownership question - my husband has no wage (stay at home parent) but all SO applications want him included. Do we also have to include him on the mortgage application? He is older than me so could it also affect the length of mortgage we could get?

@bettyvob Is there any particular reason you want to apply in your sole name?

For the lenders that I've worked with, the SO mortgage app can be in a sole name only as long as the SO application is also in a sole name as well.

@K_S Thanks. Husband is completely ambivalent to being on the mortgage or not and, in having no wage, is of no benefit to the application. As he is nearly 11 years older than me we're also concerned whether it would limit our mortgage term to about 21 years. Or can it be done based on when I turn 70 even with him on the mortgage? There's no bad credit history or anything like that, we're just worried that he might have a negative impact.

lf93

I've read conflicting things about Halifax's process with valuation and underwriting. I know a lot of their stuff is automated.
Most of what I've read is that applications get approved provisionally before valuation then after valuation if all is well an offer comes in. 
We had a desktop valuation the day of application and valuation was fine. Are you receiving responses quickly after that? The quickest I've read is same day as valuation. We're only 2 days down the line from valuation, but just trying to manage my expectations of when to hear! 
We are not self employed, all they asked for was 1 payslip on application. AFAIK they haven't asked for any more (done through broker). 
Thanks

K_S

HamSoulo said:

K_S said:

HamSoulo said:

Hi, is it true that childless couples get better mortgage deals than one with a child/children?

@hamsoulo Not quite. A couple with no dependents *may* have a higher max borrowing than a couple that do.

As per lender calulcations, the number of dependents (and associated costs such as childcare) may bring down your affordability and affect how much you can borrow.

Thank you @K_S
It makes sense and is in line with what I heard.
I appreciate that the affordability calculation has many variables and will differ on case to case basis, but if we were to ballpark the income multiplier for someone with excellent credit history- how much does it come down if there is a dependant- from 5x to 4.5x or lesser?

@hamsoulo The main thing to understand about LTI is that it is a maximum figure and dependent upon lender, LTV, income, type of employment,etc. For example if your salary is 25k, the maximum amount that Halifax may lend to you is 4.49x and that does not change whether you have no kids or 10.

This max figure can then be affected by your commited outgoings, debt, dependents, etc. As the term goes longer and/or your income goes higher, the impact that 1 or 2 dependents may have on your max borrowing goes down. I hope that makes sense.

To understand better how dependents may impact your particular circumstances, try playing around with a couple of lender affordability calculators.

https://www.nationwide-intermediary.co.uk/calculators/affordability-calculator

https://www.halifax-intermediaries.co.uk/tools_and_calculators/mortgage_affordability_calculator/default.aspx

K_S

lf93 said:

I've read conflicting things about Halifax's process with valuation and underwriting. I know a lot of their stuff is automated.
Most of what I've read is that applications get approved provisionally before valuation then after valuation if all is well an offer comes in. 
We had a desktop valuation the day of application and valuation was fine. Are you receiving responses quickly after that? The quickest I've read is same day as valuation. We're only 2 days down the line from valuation, but just trying to manage my expectations of when to hear! 
We are not self employed, all they asked for was 1 payslip on application. AFAIK they haven't asked for any more (done through broker). 
Thanks

@lf93 For straightforward employed cases Halifax offers often come through in a couple of days. If it requires any kind of manual review then those short timelines are unlikely to be met.

decs2021

Forgive me if I am about to ask this on the wrong thread but home insurance. Is this something I need to get prior to completing? I've heard mixed things so want to know what the exact answer is. Also, I have had brokers and others reaching out to me for life insurance and mortgage protection. 
I don't think we will go down the mortgage protection route as my life assurance/critical illness/income protection package through my employer is decent.
However, my partner doesn't have life insurance so we are probably looking at getting home insurance and life together. That's if we can find a decent deal. Any advise on this would be helpful please.

K_S

decs2021 said:

Forgive me if I am about to ask this on the wrong thread but home insurance. Is this something I need to get prior to completing? I've heard mixed things so want to know what the exact answer is. Also, I have had brokers and others reaching out to me for life insurance and mortgage protection. 
I don't think we will go down the mortgage protection route as my life assurance/critical illness/income protection package through my employer is decent.
However, my partner doesn't have life insurance so we are probably looking at getting home insurance and life together. That's if we can find a decent deal. Any advise on this would be helpful please.

@decs2021

- The buyer needs to take out home insurance (minimum buildings-only cover) from the day of exchange of contracts. Once contracts have been exchange you are legally obliged to complete and the seller is not obliged to insure the property.

- Unless you have specialist needs (the house is listed, next to a river, etc), home insurance would be cheapest to get directly from a comparison website. Just follow the MSE guide.

- If you are getting just life cover then again it may be cheapest to go direct but you could get a quote from the broker to compare

- Income protection can't be bought without advice so if you are looking to get it, you could get a quote from your mortgage broker and perhaps an external broker (or the insurer direct) as well to compare.

- The broker *may* have the ability to tweak their commission downwards to get you a better premium, so do negotiate/tell them if you feel it is too high or ask them to match any lower quote that you have got. Do make sure you're comparing like for like. I do a fair bit of income protection for my mortgage clients and do often "sacrifice" some commission for valued clients and sometimes to match quotes. But for brokers that are employed, they might not necessarily be allowed to offer that.

decs2021

K_S said:

decs2021 said:

Forgive me if I am about to ask this on the wrong thread but home insurance. Is this something I need to get prior to completing? I've heard mixed things so want to know what the exact answer is. Also, I have had brokers and others reaching out to me for life insurance and mortgage protection. 
I don't think we will go down the mortgage protection route as my life assurance/critical illness/income protection package through my employer is decent.
However, my partner doesn't have life insurance so we are probably looking at getting home insurance and life together. That's if we can find a decent deal. Any advise on this would be helpful please.

@decs2021

- The buyer needs to take out home insurance (minimum buildings-only cover) from the day of exchange of contracts. Once contracts have been exchange you are legally obliged to complete and the seller is not obliged to insure the property.

- Unless you have specialist needs (the house is listed, next to a river, etc), home insurance would be cheapest to get directly from a comparison website. Just follow the MSE guide.

- If you are getting just life cover then again it may be cheapest to go direct but you could get a quote from the broker to compare

- Income protection can't be bought without advice so if you are looking to get it, you could get a quote from your mortgage broker and perhaps an external broker (or the insurer direct) as well to compare.

- The broker *may* have the ability to tweak their commission downwards to get you a better premium, so do negotiate/tell them if you feel it is too high or ask them to match any lower quote that you have got. Do make sure you're comparing like for like. I do a fair bit of income protection for my mortgage clients and do often "sacrifice" some commission for valued clients and sometimes to match quotes. But for brokers that are employed, they might not necessarily be allowed to offer that.

Hi yes that makes sense, we will start looking into home insurance quotes as soon as the valuation is done. 
Yes I have a quote from the broker already but will also look out there for other life insurance quotes.
Thanks for the tip on negotiating with the broker to reduce their commission. We will take a look at few quotes.

Sotts

Question about life insurance, critical illness etc.   Buying property with my husband.  I am the sole earner and not reliant on him for money.
My employer pays sick pay at 6 months full, 6 months half pay.  Death in service benefit 3.5 times salary.
What would you recommend in terms of life,critical illness and payment protection.    I want my husband covered if anything happens to me, but not sure i need cover for anything happening to him due to him having no income.