Mortgage broker - ask me anything

viccarol

Hi I’m hoping somebody can advise. Our mortgage has come to an end, it’s an interest only mortgage with Barclays. Unfortunately at some point in the past the mortgage end date and the endowment have ended up with different dates so what is supposed to be a relief is turning into a nightmare. I spoke to Barclays many months ago about it and they said not to worry and it would get sorted after maturity. Roll forward to today and I had an extremely stressful conversation with somebody a Barclays on a really bad line (it actually sounded like he was making a brew in his kitchen) and he informed me that we now have to put a full record of both mine and my husbands income and expenses and they’ll decide what is going to happen. We have the money it’s just not released until the end of July and are happy to continue paying our normal monthly repayments. We’ve never missed a payment and have actually overpaid by quite a bit to mitigate the endowment not covering the original amount (it now will and we may actually be in a position where we could possibly come away with a little extra). 

Please can anybody advise what will happen if we just leave it until the endowment matures - how much leeway are you given - it’s so frustrating as every thing is in place just the dates are messed up. I have spoken to Barclays on a number of occasions who told me not to worry but the phone call today has really worried me are they likely to try and repossess our house even though we have documentation that the amount will be paid! 

Sorry for the long message but I am really worried.  

lmw8586

Hi,

I know I need to speak to a broker in detail about this - but trying to get my head around what the basic options are before I do so I can do a bit of research and not go in completely cold! Any advice would be very welcome

My husband and I are looking to move home in the near future (hopefully within the next 6-12 months) - and we're looking to re-locate to another part of the UK. I'll be able to take my job with me as I'm mostly WFH, but my husband won't. In an ideal world the intention would be for him to set up as self employed as part of this move

We're lucky to be in a good position - we've only got c.£20k left on our current mortgage and with the value of our current home and savings we should be able to put down about £400k deposit, we're likely to need to spend £500k - £550k to get the place we want - so looking to borrow up to approx £150k with a good LTV rate. We've overpaid on current mortgage, never missed payments, have good credit ratings etc

A quick look on the generic affordability calculators shows that on my salary alone we'd in theory be able to borrow around £250k (don't want to borrow that much - don't want to stretch that far on monthly repayments! and know these are also a bit of a blunt tool and don't take into account outgoings etc, we both have fairly spendy hobbies - horses and vehicles - part of the logic of moving is to reduce the costs associated with these)

Current mortgage is a joint mortgage - Ideally we want to stay that way but with the intention for him to become self employed would it be better to look at putting this in my name only and base it on my salary? (or is that opening a whole different can of worms because of linked finances etc?) Obviously as he's not self-employed currently there are no accounts to prove income - we're confident he'd be able to earn enough and it wouldn't all fall to me to keep the wolves from the door, but that's not helpful for lenders ;-) Would it be better for him to look for employment, at least initially? (The problem here is we're not committed to any particular area yet, we're going to need to be flexible to find what we want I think - so difficult to job search!)

Hope that makes sense - very grateful for any thoughts/advice!

K_S

silvermountains said:

Hello again, I have two more questions if that's ok:

1) In your experience, do lenders mind what percentage of a deposit is gifted? 

Context - we have been accepted for a 90% mortgage - then 5% we have saved and the other 5% is gifted.  All good.  Then, a family member kindly offered 3% of the property price as another gift.  We would still be on the same 90% mortgage rate, as it doesn't take us to 85% LTV.

But essentially, the mortgage will be 87%, we will have saved 5% and now 8% is gifted.  Is this ok?

2) In your experience, does it matter if the gifted deposit is paid directly to the solicitor? The family member is a little old fashioned and does not want to transfer this additional 3% money to us (apparently that isn't "the done thing!")  Will banks generally mind if the cash isn't actually visible in our bank accounts?

Thank you.

@silvermountains                

1. Depends on the individual lender criteria. But in most cases, it should not be an issue. Based on the limited info in your post, assuming your lender is ok with half the deposit being gifted, shouldn't make any material difference if you were to the up the gifted deposit percentage. Just do make sure that the split is correctly informed to your broker or put down in the application form if direct.

2. I have on the odd occasion in the past heard of giftors having a similar requirement and it's never come up as a problem so I'm assuming solicitors know how to make it work. Some lenders can often (not always, as it depends on the case) ask for proof of deposit, so not sure what happens in that scenario.

K_S

peppapig14 said:

we are 2.5 years into a nationwide 5 year fix
for various reasons we want to move away from the house, but ideally like to keep it for investment
we have approx 150k equity in the property, 155k left on mortgage. mortgage is 700 monthly and we could rent it out for at least 1100 monthly.
nationwide affordability states we can borrow 155k ( so we would want to look at another property for 300k or less )
would we be eligible for nationwide let to buy mortgage ?

@peppapig14 The problem with Nationwide and let to buy is that - they will ignore the background buy to let property only if the BTL remo part of the let to buy is with their sister lender - TMW. 

It might still work out for you but you would have to look at the whole picture, check with Nationwide whether they'll let you port without selling, whether TMW will lend, etc.

K_S

Dawn28 said:

I hope someone might be able to answer my questions if you have had a similar experience.
Looking to get a mortgage with Barclays for 55% LTV I have three old payday loans from 2018 & 2019 all settled in those years and I have 5 late payments from Hitachi capital in 2019-2020. Nothing since then, what are my chances of getting a mortgage? 

@dawn28 2+ year old late payments, 3+ year old pdls, 55% LTV case - based on the limited info in your post, it should be fine.

K_S

viccarol said:

Hi I’m hoping somebody can advise. Our mortgage has come to an end, it’s an interest only mortgage with Barclays. Unfortunately at some point in the past the mortgage end date and the endowment have ended up with different dates so what is supposed to be a relief is turning into a nightmare. I spoke to Barclays many months ago about it and they said not to worry and it would get sorted after maturity. Roll forward to today and I had an extremely stressful conversation with somebody a Barclays on a really bad line (it actually sounded like he was making a brew in his kitchen) and he informed me that we now have to put a full record of both mine and my husbands income and expenses and they’ll decide what is going to happen. We have the money it’s just not released until the end of July and are happy to continue paying our normal monthly repayments. We’ve never missed a payment and have actually overpaid by quite a bit to mitigate the endowment not covering the original amount (it now will and we may actually be in a position where we could possibly come away with a little extra). 

Please can anybody advise what will happen if we just leave it until the endowment matures - how much leeway are you given - it’s so frustrating as every thing is in place just the dates are messed up. I have spoken to Barclays on a number of occasions who told me not to worry but the phone call today has really worried me are they likely to try and repossess our house even though we have documentation that the amount will be paid! 

Sorry for the long message but I am really worried.  

@viccarol If the repayment vehicle is accessible in a few months time and can be evidenced to the lender, there is no in hell they are going to try and repo as it would be quite pointless.

K_S

lmw8586 said:

A quick look on the generic affordability calculators shows that on my salary alone we'd in theory be able to borrow around £250k (don't want to borrow that much - don't want to stretch that far on monthly repayments! and know these are also a bit of a blunt tool and don't take into account outgoings etc, we both have fairly spendy hobbies - horses and vehicles - part of the logic of moving is to reduce the costs associated with these)

Current mortgage is a joint mortgage - Ideally we want to stay that way but with the intention for him to become self employed would it be better to look at putting this in my name only and base it on my salary? (or is that opening a whole different can of worms because of linked finances etc?) Obviously as he's not self-employed currently there are no accounts to prove income - we're confident he'd be able to earn enough and it wouldn't all fall to me to keep the wolves from the door, but that's not helpful for lenders ;-) Would it be better for him to look for employment, at least initially? (The problem here is we're not committed to any particular area yet, we're going to need to be flexible to find what we want I think - so difficult to job search!)

Hope that makes sense - very grateful for any thoughts/advice!

@lmw8586 Well if your sole income is more than sufficient (as per lender affordability calculations) to get the amount of borrowing you need, then you should be fine applying in your joint names with only your income being considered.

Not uncommon at all when one partner's income doesn't meet a specific lender's criteria (eg: newly self employed, just started a new contract, paid in USD, etc etc.) and you don't need that income to meet affordability.

So this way you get maximum flexibility with respect to lenders (as it's only your income that matters) and Mr gets maximum flexibility on further employment or setting up as self-employed without having to worry about lender criteria.

Just to be clear, the above is very generic information based on what I could gather from the limited info in your post.

CoffeeTableBook

My partner and I are preparing to buy a home together. The stamp duty and solicitors/survey fees total around £9k. 

A family member has offered to contribute an additional £7.5k to our mortgage deposit, however the mortgage offer has already been made and I am wary of changing anything in case it is withdrawn!

To save hassle, could we simply let the lender know we are going to increase our deposit by £7.5k using our own funds (i.e. our savings that originally were going to go on the stamp duty), and then use the £7.5k from family member towards the stamp duty?

Or would they lender want to know why we were suddenly deciding to increase the deposit?

K_S

CoffeeTableBook said:

My partner and I are preparing to buy a home together. The stamp duty and solicitors/survey fees total around £9k. 

A family member has offered to contribute an additional £7.5k to our mortgage deposit, however the mortgage offer has already been made and I am wary of changing anything in case it is withdrawn!

To save hassle, could we simply let the lender know we are going to increase our deposit by £7.5k using our own funds (i.e. our savings that originally were going to go on the stamp duty), and then use the £7.5k from family member towards the stamp duty?

Or would they lender want to know why we were suddenly deciding to increase the deposit?

@coffeetablebook It's hard to say exactly what the implications would be or what the lender will query as that will depend on the specifics, what's gone in the application form, whether it will seen as a gifted deposit, etc. I would recommend speaking with your broker (or lender if direct) or conveyancer to put a hypothetical forward and see what they say.

jmeredith123

Hi I'm an unusual and complicated case and finding it hard to get a mortgage, any advice would be appreciated:

- I own a flat that is on a buy to let mortgage. This is the only property I own and I rent the home I live in.
- apart from 60k left on my buy to let mortgage I have no debt
- I have a 65k deposit
- I am a contractor and a company director. I earn £75k as a contractor but prior to that I was earning minimum wage as a director with a salary.
Last year I moved to France to try and buy a home and live there, however this didn't work out and i came back after 6 months before I became a resident.

What are my chances of getting a mortgage? I just found out that my very short move to France has probably messed up my required 3 year UK address history. I'm 53 and want to get a mortgage asap.

Thanks in advance!