Mortgage broker - ask me anything

kingstreet

Nomis88 said:

Hello,

Looking to borrow c.£825k for a property of c.£1m. I've been looking at Habito's online rate checker and they have indicated that this is possible via Virgin Money - 2 years at 4.88% on a 25 year term. I ran our details through VM's eligibility checker and they say we're very likely to get a mortgage but the highest they would lend is £794k, which is a little off where we would like to be. This is all via their calculator, not discussing details with a mortgage advisor to get a AIP. Who should I trust? I don't want to go through a credit check to get an AIP and then realise that it's not enough.
My income: £99.75k
Annual bonus: c.£30k (track record of this being paid)
Partner's income: £78k
Annual bonus: £4k
No kids
No loans, other debt
Credit cards - a few Amex's - paid off in full each month

Thanks in advance!

Be careful. VM max LTV on a PP of £750k to £1.25m is 80%.

Combleforth

Currently on a BMR mortgage with Nationwide- 12 years left, £60k remaining. The interest rates have increased the monthly payment to £565 this month, and the recent financial news means it'll increase further next month.

I've looked into switching to a fixed rate- the best offer looks to be for 5 years at £562, and would reduce the term to 11 years (as desired).

If I switch from the BMR I can't go back after the 5 years fixed term has expired.

The sticking point for me is of course whether the interest rate will increase further, or start to decline. Obviously this can't be precisely predicted, but what would you do in this situation??

Thank you in advance!

Combleforth

K_S

mdj1876 said:

Help!

I have approx. 15-20 missed payments on credit cards between Jan 2019 and Oct 2020. All at 1-month status but one in early 2019 is a 2 month status. My credit report prior to this and after is immaculate and I had a mortgage from 2018-2020 with no missed payments. I don't have any credit card balances and I've got a number of well-managed credit lines since 2020. So 26 months since the last missed payment. Also got a couple of payday loans from mid-2017, all paid on time. 

What are the chances of me getting a 90% LTV with my partner (whose credit report is squeaky clean)?

@mdj1876 Chances of getting a 90% LTV mortgage with multiple '1' markers that are all 2+ years old and an otherwise clean report - 100%.

Whether that will be with a mainstream lender like Halifax or a mainstream light adverse product like Accord-Cascade range will depend on the details, what exactly your credit reports look like, etc.

K_S

Combleforth said:

Currently on a BMR mortgage with Nationwide- 12 years left, £60k remaining. The interest rates have increased the monthly payment to £565 this month, and the recent financial news means it'll increase further next month.

I've looked into switching to a fixed rate- the best offer looks to be for 5 years at £562, and would reduce the term to 11 years (as desired).

If I switch from the BMR I can't go back after the 5 years fixed term has expired.

The sticking point for me is of course whether the interest rate will increase further, or start to decline. Obviously this can't be precisely predicted, but what would you do in this situation??

Thank you in advance!

Combleforth

@combleforth I'd ignore the matter of the term length as you can always overpay and effectively shorten the term if need be.

As you rightly say, it's impossible to predict the direction of interest rates but current market expectations are for the BoE rate to go up to 4.25-4.5% and then stay there until inflation is in control, followed by a gradual decline. It's anyone's guess as to whether that will turn out to be the case or not or whether unknown events will lead to a different path.

Personally, if I had funds to overpay significant amounts regularly, I'd consider staying on the BMR (or alternatively remortgage/rate-switch to an ERC-free 2yr tracker) and hammer away at the mortgage.

If surplus funds were tight and I didn't expect to make overpayments, then I'd consider a longer 5/7/10 year fix for the certainty.

mdj1876

K_S said:

mdj1876 said:

Help!

I have approx. 15-20 missed payments on credit cards between Jan 2019 and Oct 2020. All at 1-month status but one in early 2019 is a 2 month status. My credit report prior to this and after is immaculate and I had a mortgage from 2018-2020 with no missed payments. I don't have any credit card balances and I've got a number of well-managed credit lines since 2020. So 26 months since the last missed payment. Also got a couple of payday loans from mid-2017, all paid on time. 

What are the chances of me getting a 90% LTV with my partner (whose credit report is squeaky clean)?

@mdj1876 Chances of getting a 90% LTV mortgage with multiple '1' markers that are all 2+ years old and an otherwise clean report - 100%.

Whether that will be with a mainstream lender like Halifax or a mainstream light adverse product like Accord-Cascade range will depend on the details, what exactly your credit reports look like, etc.

Thanks so much for the response. It's for a new build purchase so not sure we could go with an Accord-Cascade product but hopefully there will be something else out there!

I'd say we have pretty simple credit reports. Partner has only ever had car finance, phone and a single credit card used in the past and always paid off the balance. I've had multiple credit/store cards and loans over the years from balance transferring to refinancing my loan for a better rate. Nothing overly obscure on there.

Thank you for the advice  

Combleforth

K_S said:

Combleforth said:

Currently on a BMR mortgage with Nationwide- 12 years left, £60k remaining. The interest rates have increased the monthly payment to £565 this month, and the recent financial news means it'll increase further next month.

I've looked into switching to a fixed rate- the best offer looks to be for 5 years at £562, and would reduce the term to 11 years (as desired).

If I switch from the BMR I can't go back after the 5 years fixed term has expired.

The sticking point for me is of course whether the interest rate will increase further, or start to decline. Obviously this can't be precisely predicted, but what would you do in this situation??

Thank you in advance!

Combleforth

@combleforth I'd ignore the matter of the term length as you can always overpay and effectively shorten the term if need be.

As you rightly say, it's impossible to predict the direction of interest rates but current market expectations are for the BoE rate to go up to 4.25-4.5% and then stay there until inflation is in control, followed by a gradual decline. It's anyone's guess as to whether that will turn out to be the case or not or whether unknown events will lead to a different path.

Personally, if I had funds to overpay significant amounts regularly, I'd consider staying on the BMR (or alternatively remortgage/rate-switch to an ERC-free 2yr tracker) and hammer away at the mortgage.

If surplus funds were tight and I didn't expect to make overpayments, then I'd consider a longer 5/7/10 year fix for the certainty.

Thank you- much appreciated

Thaisparrow

Hello, I have a question about what to put for salary on an AIP. My wage increased by 2k but won’t be paid this amount until end of Feb; when it asks for my salary, should I put my new pay, or my old pay as if they request payslips it’s gonna show the older pay?

kingstreet

Thaisparrow said:

Hello, I have a question about what to put for salary on an AIP. My wage increased by 2k but won’t be paid this amount until end of Feb; when it asks for my salary, should I put my new pay, or my old pay as if they request payslips it’s gonna show the older pay?

Depends on the lender. Some will accept a letter confirming payrise. Others want to see first payslip at higher level. Want to share?

Thaisparrow

kingstreet said:

Thaisparrow said:

Hello, I have a question about what to put for salary on an AIP. My wage increased by 2k but won’t be paid this amount until end of Feb; when it asks for my salary, should I put my new pay, or my old pay as if they request payslips it’s gonna show the older pay?

Depends on the lender. Some will accept a letter confirming payrise. Others want to see first payslip at higher level. Want to share?

Thanks king street! The lender is going to be NatWest or Halifax! 

kingstreet

IIRC NatWest needs a payslip and Halifax can request an employer's reference by email.