Mortgage broker - ask me anything

K_S

mustachio said:

Hi,

I'm looking to re-mortgage with a massive reduction on the term i.e. from 27 down to 9 years. We are just looking to clear it asap! Don't like being in debt.

Obviously the rate will increase per month with such a reduction substantially HOWEVER we have already matching that rate by overpaying the mortgage for over 18 months now. So we have shown that we can pay that rate already.

Are mortgage lenders likely to be agreeable to this significant reduction? It is 55% of my earnings towards the mortgage which is higher than they would normally recommend though since I have a proven track record I'm hopeful they will see sense.

What I don't want is refusing and trying to keep me on this 27 year mortgage where can only overpay 10% each year. Blah.

@mustachio From a lender's point of view, they calculate affordablity in a certain way, with a lot of standard assumptions with relation to spending. They will not make any adjustment to this irrespective of your track record.

To get a very very general idea of what minimum term you may be able to go to for the level of borrowing you require, have a play around with a couple of lender calculators.

Have you considered a tracker or discount product that allows you to overpay as much as you like with no penalty? That way you can keep the term as long as you please (to avoid contractually tieing yourself into a higher monthly payment) while still having the freedom to overpay as much as you want. Of course, you lose the security of a fix.

Housetohouse

Hi, I have just gone up for sale. Looking to downsize and reduce mortgage.
I am self employed, single parent with 1 dependent DC 15 yrs.
I use an accountant and have gross profit of year ending 2019 £9400 2020 7500.
With an estimated earnings for 2012 £10 000 approx.
I receive tax credits of £600 pm and child maintenance £600 pm an informal agreement which has been paid since DC was born into my bank account.
My outstanding mortgage is £108,000. I want to pay this off.
My house is for sale at £239.999.
I have allowed approx £8000 for fees,etc and have approx a further £12000 in savings.
I would ideally like a mortgage of £35,000.Wonder if thats possible, I am 54 years old with a NHS pension starting at 60 years. I no longer work in the NHS and hope to keep working as a sole trader until I am 70 years old.
I have no other debt apart from the mortgage, hold credit cards but dont use them.
Any help would be appreciated as a broker has been suggested to me and I am wondering how to choose one.
Many thanks for any help.

K_S

@housetohouse It may be doable but it's definitely tricky

- is there any kind of written agreement on the informal child maintenance of £600 pm? When is it scheduled to end?
- what exact profit figure does your 2019/2020 SA302 show? What do you expect it to show for 2020/21?
- what's the annual pension income going to be from 60?
- what's your trade and how long have you been doing it

soprano81

Is it possible to borrow from a buy to let that is mortgage free to help fund extension on the home we live in? Thanks 

K_S

soprano81 said:

Is it possible to borrow from a buy to let that is mortgage free to help fund extension on the home we live in? Thanks 

@soprano81 In principle, yes.

mustachio

K_S said:

mustachio said:

Hi,

I'm looking to re-mortgage with a massive reduction on the term i.e. from 27 down to 9 years. We are just looking to clear it asap! Don't like being in debt.

Obviously the rate will increase per month with such a reduction substantially HOWEVER we have already matching that rate by overpaying the mortgage for over 18 months now. So we have shown that we can pay that rate already.

Are mortgage lenders likely to be agreeable to this significant reduction? It is 55% of my earnings towards the mortgage which is higher than they would normally recommend though since I have a proven track record I'm hopeful they will see sense.

What I don't want is refusing and trying to keep me on this 27 year mortgage where can only overpay 10% each year. Blah.

@mustachio From a lender's point of view, they calculate affordablity in a certain way, with a lot of standard assumptions with relation to spending. They will not make any adjustment to this irrespective of your track record.

To get a very very general idea of what minimum term you may be able to go to for the level of borrowing you require, have a play around with a couple of lender calculators.

Have you considered a tracker or discount product that allows you to overpay as much as you like with no penalty? That way you can keep the term as long as you please (to avoid contractually tieing yourself into a higher monthly payment) while still having the freedom to overpay as much as you want. Of course, you lose the security of a fix.

Its not what I wanted to hear though it is a reality check. Would a mortgage broker be able to make much difference?

mrseff_2

Hi there - this thread has been an absolute life line over the last couple of months - thank you!
I will ask my MB tomorrow but was just pondering on whether this would be a wise move or not... I have a mortgage offer through Precise so obviously have some adverse. I have been working through Dave Ramsey's baby steps and really want to get started on paying off credit cards - I have two cards with a total balance across the two of £4,400 - the interest rate on them though is disgusting! I am desperate to start really throwing some money at these with the hope of getting them cleared down fast (it's not a condition of the mortgage offer). If I got one of the virgin 0% credit cards and transferred balance to it (or as much as I could) would this be a risky move in terms of any further credit check before completion? My house is likely to be ready end June so I have a few months to go but really want to get started now. Any thoughts appreciated!

AJG_

Hi everybody, first time poster looking for some advice.

At the end of this year or early next year (anywhere between Dec - Feb) I will be in a position to start looking for a mortgage.   I will be living alone and earn £43k per annum and when the time comes I will have between 15-20% saved for a deposit depending on the property value.

My queries come around my previous financial behaviour - in the past when I wasn't earning so much I did run into some difficulty and didn't manage my money well at all, completely my own fault but a great learning curve for me.  On my credit file I have a default with Halifax (later sold to Cabot) that was settled in September last year and when I look for a mortgage it will be over 4 years since it was applied.  I also have a few missed payments going back to 2018 and up to March 2019 as well as various high cost sub prime loans over the last 6 years with Mr Lender, My Jar, Avant and Sunny.

My credit file will also show that I have missed no payments anywhere for 2.5 years and have cleared c.£15k of debt since the beginning of 2020.   I'll have around £1k outstanding on a credit card when I come to look for a mortgage and no other outstanding debt with anybody.

I am very much aware that because of my past behaviour I will not be able to use a high street lender, but from experience, am I  likely to be able to find a lender if I use a sub prime broker or will I likely have difficulty in securing this too?

Any guidance will be greatly appreciated and please let me know if there's any information that I haven't included that will help you assess my situation.

Thank you.

K_S

mustachio said:

K_S said:

mustachio said:

Hi,

I'm looking to re-mortgage with a massive reduction on the term i.e. from 27 down to 9 years. We are just looking to clear it asap! Don't like being in debt.

Obviously the rate will increase per month with such a reduction substantially HOWEVER we have already matching that rate by overpaying the mortgage for over 18 months now. So we have shown that we can pay that rate already.

Are mortgage lenders likely to be agreeable to this significant reduction? It is 55% of my earnings towards the mortgage which is higher than they would normally recommend though since I have a proven track record I'm hopeful they will see sense.

What I don't want is refusing and trying to keep me on this 27 year mortgage where can only overpay 10% each year. Blah.

@mustachio From a lender's point of view, they calculate affordablity in a certain way, with a lot of standard assumptions with relation to spending. They will not make any adjustment to this irrespective of your track record.

To get a very very general idea of what minimum term you may be able to go to for the level of borrowing you require, have a play around with a couple of lender calculators.

Have you considered a tracker or discount product that allows you to overpay as much as you like with no penalty? That way you can keep the term as long as you please (to avoid contractually tieing yourself into a higher monthly payment) while still having the freedom to overpay as much as you want. Of course, you lose the security of a fix.

Its not what I wanted to hear though it is a reality check. Would a mortgage broker be able to make much difference?

@mustachio If you're asking if a broker's expertise can help override a specific lender's affordablity calculations, I'm afraid not.

K_S

mrseff_2 said:

Hi there - this thread has been an absolute life line over the last couple of months - thank you!
I will ask my MB tomorrow but was just pondering on whether this would be a wise move or not... I have a mortgage offer through Precise so obviously have some adverse. I have been working through Dave Ramsey's baby steps and really want to get started on paying off credit cards - I have two cards with a total balance across the two of £4,400 - the interest rate on them though is disgusting! I am desperate to start really throwing some money at these with the hope of getting them cleared down fast (it's not a condition of the mortgage offer). If I got one of the virgin 0% credit cards and transferred balance to it (or as much as I could) would this be a risky move in terms of any further credit check before completion? My house is likely to be ready end June so I have a few months to go but really want to get started now. Any thoughts appreciated!

@mrseff_2 The standard advice is to not make any new credit apps between offer and completion, as far as practically possible.