Mortgage broker - ask me anything

col81

I am looking to possibly re mortgage in May i will have all personal debt paid off and my defaults will be off mile file so a clean slate i earn £40k and currently owe £118k on house worth £150k. I am on interest only at £330 per month. Would i be better sticking with the £330 and overpaying or changing to a repayment mortgage?? 

K_S

col81 said:

I am looking to possibly re mortgage in May i will have all personal debt paid off and my defaults will be off mile file so a clean slate i earn £40k and currently owe £118k on house worth £150k. I am on interest only at £330 per month. Would i be better sticking with the £330 and overpaying or changing to a repayment mortgage?? 

@col81 I can't give you a definitive answer as that could be construed as advice on little to no information.

If you remortgage to repayment at 80% LTV, you are looking at interest rates of about 2-2.5%, very roughly speaking.

Your current deal looks like it's about 3.3% or so interest only.

Which of these options is better for depends on a lot of aspects - term left on the I/O mortgage, how long to retirement, will you be able to remortgage in a few years time, how much value do you place on the flexibility that an I/O mortgage gives, etc etc.

col81

I am 40 years old. The deal i have was a sub prime deal following the Libor rate and yes it is around 3.3% above the Libor which is rock bottom. Thanks for the good advice

jrt87

We have just over ~26% equity in our house at present valued (I think very conservatively) at £480,000 in July (a zoopla  estimate is now between £519-574k). 

We took a 2 year deal last summer as we weren’t able to get any additional borrowing at the time as I had been self employed as a GP partner for about 15 months. At the time we were told our current lender (Santander) may consider additional borrowing once I had been self employed 2 years. The partnership I am part of has been running for must be 50 odd years or more and profits have been stable for the last 10 years.
We had hoped to borrow an additional 40k from Santander on additional borrowing to our current deal come April to extend, depending on valuation that may put LTV somewhere between 72-82%. 

Recent news seems to suggest a huge crackdown on self employed borrowing by lenders with borrowers requiring 60% LTV. Does additional borrowing as a self employed person now seem a pipe dream in the current climate with those LTV figures? 

K_S

@jrt87 Unfortunately Santander is currently restricting any applications with a self employed component to 60% LTV max. No harm in asking Santander, direct additional borrowing might well be treated differently.

Given the circumstances described, you would have plenty of options if you weren't tied to Santander.

Clonmel

Hello my daughter had her flat on the market but didn’t have much interested  buyers so as her fixed term mortgage had come to an she remortgage on Monday this week but just afterwards she had an offer on her property! 

What I would like to know if she has the 14 day cooling off period as it is a credit agreement? 

They have added a lot  of fees for remortgage which she did on line .

K_S

@clonmel It sounds like a product switch (staying with the same lender) and not a remortgage (changing lenders).

Has the new fixed-term commenced? If it has, afaik, it is unlikely that there will be a way to exit without paying a penalty (if one exists). Best give the lender a call.

getmore4less

james_williamson_6544 said:

thanks for the helpful thread:
mortgage value = 65000
lender = nationwide
current interest = 1.94% fixed rate ending 30/6 - meaning I can apply for rate switch in Feb which will take effect in April.
If I get a 4 year fix at 1.60%, using "original" overpayment allowance with Nationwide, I will be mortgage free by end of the term.
Benefit of staying with nationwide is I get 10% of original loan as overpayment allowance
Benefit of moving to a different lender is that I might get some cashback
However there is no 4 year product. So should I:
A - Take 2 year fix and then another 2 year fix with Nationwide.
B - Take a longer fix (3 year or 5 years) and then either pay ERC or standard variable rate on a smaller capital ?
C - Move away from Nationwide and get cashback 

Confused !!! Maybe I am counting pennies ?

If we look at your nationwide options.
one option is the 5y and just let it run after your overpayments get it to a very small/zero amount.
Depending on your cash flow 2+2 might be cheaper.
Looking at todays rates( your overpayments potential will make any of the fee based more expensive even with a lower rate)
2y 1.49%
3y 1.59%
5y 1.49%

Unless you think 2/3y rates are likely to go down again might as well take the 5y
5y on 5y term with regular overpayments

amount	rate	payment	owing	interest
£65,000.00	1.49%	£1,124.86	£0.00	£2,491.64

if you can do it in 4y and stay within the 10% limit

amount	rate	payment	owing	interest
£65,000.00	1.49%	£1,395.76	£0.00	£1,996.57

The ability to max overpayments at 10% of original is worth ~£500

What deals are there from other lenders  if you can find a lower rate and or net  net cashback over £500 then the number crunch is worth a go with 10% of current balance OPs

Has anyone else got a no fee 1.49% 5y rate for a remortgage?

ang2999

Hi, is it possible for me to apply for a mortgage in my name only when i am married? 

Penguin_

Are there any companies that offer an online DIP for a mortgage with bad credit?