Mortgage broker - ask me anything

K_S

Savingupsally29 said:

Can i ask a question please
I've seen that santander are the single provider that will allow a loan as deposit. A broker from a large company has offered to look into this for us. Payment of £500 application. 

Our circumstances are that we have 8k saved but need about 20k for a 5% deposit and fees the cost of property in our region. Based on the affordability calculators I have used we can afford the loan for the deposit alongside the mortgage. We have perfect credit scores after paying off all debt recently. Appreciate some will say just save but cirucumstances would make a 12k loan preferabe to us. gifts from family not an option. 

1. Is this a broker i should go with based on payment on application. Surely payment on approval ?! how do you find a quality broker?

2. Have you seen many of these applications accepted where deposit is loaned but good affordability and credit history?

@Savingupsally29

There are a couple of lenders who will consider a borrowed deposit but Santander is the only mainstream one. Do you have a loan arranged with the terms, monthly payment, etc. known?

1. Personally, I would recommend using a broker who charges only on offer. That way the broker also has some skin in the game to get you to an offer. Generally speaking, 95% underwriting is quite finicky so as a borrower you want to minimise any sunk costs until you have a mortgage offer. Personally, £500 broker fee is a bit high imho for that loan size.

2. Most borrowers aren't aware that some lenders allow part of the deposit to be borrowed, so most brokers don't do a lot of these. From memory I might do 1-2 every couple of months, mostly with Santander and another smaller building society. Never had an issue as long as the case was placed properly, important aspects were run past the lender in advance and the application was properly packaged.

Savingupsally29

@K_S thanks for speed reply . No loan arranged as yet. Still investigating. The broker said not to apply until later stage of application . 

Thanks for comments on the broker. Is there a place to go to find a well qualified experienced broker ? 

ClaireE

K_S said:

ClaireE said:

I need quite a hefty remortgage on my property. My ex husband has a financial interest in it and wants his share asap. I have re-married and we need to combine our incomes for the repayments of the new mortgage. My new husband is self employed, a sole trader. Santander has asked for the last 3 years of his yearly net profit. His accountant has passed me the paper work but only one of the years - the last one - shows the net profit the bank Santander has said will allow the application to go through. The previous two years show much lower net profits. Can we get round this, would the bank accept the last year alone?

@clairee Santander take latest year's net profit for affordablity purposes, presumably why you chose them I suppose? If the disparity is very high (subjective of course) - for example it's 15k, 20k and now 50k, they may query further or dig into it a bit more.

Santander are who I have my current mortgage with. They asked for his last 3 years net profit. . And yes the disparity is high. I don't know how we get round this. It's making me very anxious as we really don't want to sell the house. I have my 3 teenage student sons living here (two are 18+) and I wouldn't be able to find a suitable home on the money I will be left with.

K_S

ClaireE said:

K_S said:

ClaireE said:

I need quite a hefty remortgage on my property. My ex husband has a financial interest in it and wants his share asap. I have re-married and we need to combine our incomes for the repayments of the new mortgage. My new husband is self employed, a sole trader. Santander has asked for the last 3 years of his yearly net profit. His accountant has passed me the paper work but only one of the years - the last one - shows the net profit the bank Santander has said will allow the application to go through. The previous two years show much lower net profits. Can we get round this, would the bank accept the last year alone?

@clairee Santander take latest year's net profit for affordablity purposes, presumably why you chose them I suppose? If the disparity is very high (subjective of course) - for example it's 15k, 20k and now 50k, they may query further or dig into it a bit more.

Santander are who I have my current mortgage with. And yes the disparity is high. I don't know how we get round this. It's making me very anxious as we really don't want to sell the house. I have my 3 teenage student sons living here (two are 18+) and I wouldn't be able to find a suitable home on the money I will be left with.

@clairee As I mentioned, it is subjective. If they do query it, it will be just to see if there's any artifical boosting of profits for the purpose of meeting affordability or any concerns around sustainability (what's the risk of the net profit going down back to 20k next year, etc).

Just to be clear, not suggesting that you did anything wrong, just trying to illustrate what the lender may consider. So as long as the business is up and running, no govt grants in the last 3 months and assuming the increase is sustainable, you shouldn't have too much to worry about.

Hopefully, as a like-for-like transfer of equity application with a track record of meeting payments, Santander will treat it favourably. Good luck!

ClaireE

K_S said:

ClaireE said:

K_S said:

ClaireE said:

I need quite a hefty remortgage on my property. My ex husband has a financial interest in it and wants his share asap. I have re-married and we need to combine our incomes for the repayments of the new mortgage. My new husband is self employed, a sole trader. Santander has asked for the last 3 years of his yearly net profit. His accountant has passed me the paper work but only one of the years - the last one - shows the net profit the bank Santander has said will allow the application to go through. The previous two years show much lower net profits. Can we get round this, would the bank accept the last year alone?

@clairee Santander take latest year's net profit for affordablity purposes, presumably why you chose them I suppose? If the disparity is very high (subjective of course) - for example it's 15k, 20k and now 50k, they may query further or dig into it a bit more.

Santander are who I have my current mortgage with. And yes the disparity is high. I don't know how we get round this. It's making me very anxious as we really don't want to sell the house. I have my 3 teenage student sons living here (two are 18+) and I wouldn't be able to find a suitable home on the money I will be left with.

@clairee As I mentioned, it is subjective. If they do query it, it will be just to see if there's any artifical boosting of profits for the purpose of meeting affordability or any concerns around sustainability (what's the risk of the net profit going down back to 20k next year, etc).

Just to be clear, not suggesting that you did anything wrong, just trying to illustrate what the lender may consider. So as long as the business is up and running, no govt grants in the last 3 months and assuming the increase is sustainable, you shouldn't have too much to worry about.

Hopefully, as a like-for-like transfer of equity application with a track record of meeting payments, Santander will treat it favourably. Good luck!

Thank you for your kind help. Would I be burning all my bridges if I tell Santander that we can only provide one year (2020-21) of the desired net profit? If they say no can do, then what options am I left with for a re-mortgage? The previous years that show a greater disparity is when my husband was working for various companies, who either didn't pay well or didn't do everything by the book. In the past year he has his own van and taking on many jobs of his own & is doing much better. This will continue but how do we prove tht to the bank?

K_S

ClaireE said:

K_S said:

ClaireE said:

K_S said:

ClaireE said:

I need quite a hefty remortgage on my property. My ex husband has a financial interest in it and wants his share asap. I have re-married and we need to combine our incomes for the repayments of the new mortgage. My new husband is self employed, a sole trader. Santander has asked for the last 3 years of his yearly net profit. His accountant has passed me the paper work but only one of the years - the last one - shows the net profit the bank Santander has said will allow the application to go through. The previous two years show much lower net profits. Can we get round this, would the bank accept the last year alone?

@clairee Santander take latest year's net profit for affordablity purposes, presumably why you chose them I suppose? If the disparity is very high (subjective of course) - for example it's 15k, 20k and now 50k, they may query further or dig into it a bit more.

Santander are who I have my current mortgage with. And yes the disparity is high. I don't know how we get round this. It's making me very anxious as we really don't want to sell the house. I have my 3 teenage student sons living here (two are 18+) and I wouldn't be able to find a suitable home on the money I will be left with.

@clairee As I mentioned, it is subjective. If they do query it, it will be just to see if there's any artifical boosting of profits for the purpose of meeting affordability or any concerns around sustainability (what's the risk of the net profit going down back to 20k next year, etc).

Just to be clear, not suggesting that you did anything wrong, just trying to illustrate what the lender may consider. So as long as the business is up and running, no govt grants in the last 3 months and assuming the increase is sustainable, you shouldn't have too much to worry about.

Hopefully, as a like-for-like transfer of equity application with a track record of meeting payments, Santander will treat it favourably. Good luck!

Thank you for your kind help. Would I be burning all my bridges if I tell Santander that we can only provide one year (2020-21) of the desired net profit? If they say no can do, then what options am I left with for a re-mortgage? The previous years that show a greater disparity is when my husband was working for various companies, who either didn't pay well or didn't do everything by the book. In the past year he has his own van and taking on many jobs of his own & is doing much better. This will continue but how do we prove tht to the bank?

@clairee All I would say is to just give Santander what they are asking for, answer any queries that arise as best as you can and hope for a positive outcome

In the unfortunate event that Santander doesn't work out, I would recommend considering the use of a broker for checking out your remortgage options. Good luck!

doraspenlow

Hello. My question is:
Which mainstream lenders take 100% of overtime into account as income, and how will they assess this? Husband earns £10-£15k in overtime every year in addition to base salary, but this is inconsistent across monthly payslips. 

K_S

doraspenlow said:

Hello. My question is:
Which mainstream lenders take 100% of overtime into account as income, and how will they assess this? Husband earns £10-£15k in overtime every year in addition to base salary, but this is inconsistent across monthly payslips. 

@doraspenlow Depends on how long a track record can be shown and how much it fluctuates from month to month. If the last P60 reflects this level of overtime, a couple of lenders will consider.

HistoryGirl_3

As a FTB with small deposit (9000) what are my chances of getting a 95% mortgage?

K_S

HistoryGirl_3 said:

As a FTB with small deposit (9000) what are my chances of getting a 95% mortgage?

@historygirl_3 Simply isn't enough information to say. If your income/outgoings will support it and you have a clean credit history, you could potentially get one.