Mortgage broker - ask me anything

KuchKuch

K_S said:

KuchKuch said:

Hi @K_S,

I'm a first time buyer and a qualified accountant who has a perfect credit rating (according to Experian anyway). What are the chances of getting a professional mortgage with a lender that would allow me to borrow 6 times my salary? Do any exist or is this just wishful thinking in the current environment?

Thanks in advance.

@kuchkuch There are a few mainstream lenders (like Platform, Clydesdale, etc.) that will consider up to 5.5x for professionals and a few specialist lenders (like Kensington, Foundation, Hodge, etc.) that will consider up to 6x for professionals subject to criteria, affordability and specifics. Each will have differing criteria - age, time since qualification, minimum income, LTV caps, loan size caps, etc.

So to answer your question, they do exist but whether or not you will be able to borrow 6x will depend on the specifics and the numbers.

Thanks @K_S for confirming.

I've managed to get a DiP myself from Metro Bank for 5.5 times my salary, but several brokers I've spoken to can't even get close to this (even though some deal with Metro Bank), let alone 6 times my salary despite me telling them to look specifically at professional mortgages and giving them the same information I gave to Metro Bank.

Is there anything I can do/say so brokers are able to find these deals for me as they seem to be having no luck! 

sarahdh

We are in the mortgage application at present, this is our progress so far:

Thurs 9th - Initial application 
Thurs 9th - referred by Nationwide
Fri 10th - DIP approved
Fri 10th - full application submitted

Fri 10th - valuation booked for 14th

The searches that have been conducted by Nationwide are being report as follows:

Credit Karma (Transunion):

Soft on 9th

Hard on 10th

Hard on 11th (same search reference number as 10th)

Clearscore (Equifax):

Hard on 11th

Checkmyfile:

Soft on 9th (Transunion)

Soft on 9th (Equifax)

Soft on 9th (Equifax)

Soft on 9th (Equifax)

Hard on 11th (Transunion)

Hard on 11th (Equifax)

Does this mean they've conducted at least 2 hard searches? Is this normal? This is my first ever mortgage application, and I'm really nervous! I'm worried it might mean there's an issue of some sort.

K_S

Koksmanareikals said:

Hi. I am self employed builder. I don't have one fixed work place. I am ready to buy house but wondering how far away from my current place I can go? TIA

@Koksmanareikals In principle, as a self-employed builder, if you're not tied to a specific contract or organisation, it should be fine to move pretty much anywhere in the country. The lender will however do their own plausibility check as to whether or not the move will impact your income. To give a crude example if you're currently operating in/around central London and are moving to the North East, the underwriter may be concerned about you being able to maintain the same level of income.

K_S

KuchKuch said:

K_S said:

KuchKuch said:

Hi @K_S,

I'm a first time buyer and a qualified accountant who has a perfect credit rating (according to Experian anyway). What are the chances of getting a professional mortgage with a lender that would allow me to borrow 6 times my salary? Do any exist or is this just wishful thinking in the current environment?

Thanks in advance.

@kuchkuch There are a few mainstream lenders (like Platform, Clydesdale, etc.) that will consider up to 5.5x for professionals and a few specialist lenders (like Kensington, Foundation, Hodge, etc.) that will consider up to 6x for professionals subject to criteria, affordability and specifics. Each will have differing criteria - age, time since qualification, minimum income, LTV caps, loan size caps, etc.

So to answer your question, they do exist but whether or not you will be able to borrow 6x will depend on the specifics and the numbers.

Thanks @K_S for confirming.

I've managed to get a DiP myself from Metro Bank for 5.5 times my salary, but several brokers I've spoken to can't even get close to this (even though some deal with Metro Bank), let alone 6 times my salary despite me telling them to look specifically at professional mortgages and giving them the same information I gave to Metro Bank.

Is there anything I can do/say so brokers are able to find these deals for me as they seem to be having no luck! 

@kuchkuch It's not about a 'deal' but about qualifying for that product and the numbers adding up for the amount of borrowing that that product will potentially allow. Just because a professional product will offer up to 6x income doesn't mean that every professional will get 6x income. I hope that makes sense.

If multiple brokers have looked at your case and said they can't get what you need, and those brokers include a couple outside the vanilla volume brokers, then it probably means that that is the case. You'd have to be extraordinarily unlucky to have spoken to several experienced brokers and have all of them miss out on a solution that would allow you to borrow 6x.

Good luck, I hope you are eventually able to borrow what you need!

Koksmanareikals

K_S said:

Koksmanareikals said:

Hi. I am self employed builder. I don't have one fixed work place. I am ready to buy house but wondering how far away from my current place I can go? TIA

@Koksmanareikals In principle, as a self-employed builder, if you're not tied to a specific contract or organisation, it should be fine to move pretty much anywhere in the country. The lender will however do their own plausibility check as to whether or not the move will impact your income. To give a crude example if you're currently operating in/around central London and are moving to the North East, the underwriter may be concerned about you being able to maintain the same level of income.

Thank you for your reply. I have no ties at all. I am not looking to move drasticaly from my current location. 

Maximum 70 miles away via motorway. 
From 1h to 1:30h drive.

Rigpig66

hi I’ve got mortgage offer and currently signed all documents even the mortgage deed and Transfer forms back to solicitor last week, how long do you think till all completed? Solicitor is enact (free via lender) thanks 

Rhapsody1356

I am a pensioner and have a sub prime mortgage of £45,000 on my property on which I am now paying 9.25%. The property is valued at about £100,000 so I have a fair bit of equity in it. Unfortunately my credit rating will not be good as during the pandemic I was self employed and could not pay my credit cards, on which I owed a total of £24,000, I intended to pay this off when I sell the house which has only 4 years to run on the interest only mortgage. Is there any possibility of me getting a mortgage on a lower rate, I do not want to get equity release as I would prefer to my rent my next property and travel for a bit with the equity I get from the sale.
Thanks for any help you can give me.

K_S

@Rhapsody1356 It'll depend on the specifics, the numbers and what's in your credit reports. I would recommend getting the latest copy of your credit reports (all 3 from CheckMyFile or individually from Experian, Equifax and TransUnion) and speaking to an experienced broker that knows adverse. Good luck!

Rhapsody1356 said:

I am a pensioner and have a sub prime mortgage of £45,000 on my property on which I am now paying 9.25%. The property is valued at about £100,000 so I have a fair bit of equity in it. Unfortunately my credit rating will not be good as during the pandemic I was self employed and could not pay my credit cards, on which I owed a total of £24,000, I intended to pay this off when I sell the house which has only 4 years to run on the interest only mortgage. Is there any possibility of me getting a mortgage on a lower rate, I do not want to get equity release as I would prefer to my rent my next property and travel for a bit with the equity I get from the sale.
Thanks for any help you can give me.

howzat92

I am in the process of buying with my girlfriend. We are buying her parents house which currently has no mortgage - when her Mother died my girfriend aquired a 25% share of the property through her Mothers will.  

We are using her 25% share as part of our deposit. Our mortgage broker has arranged a remortgage with Virgin Money 2 Year Fixed 4.80%. 

Does this sound correct doing a remortgage for this, don't feel our broker has explained how things will work very clearly to us. Also thinking now I won't be able to use my LISA Bonus - which he didn't tell us when applying.  Any advice welcome. 

Bakerman1989

K_S said:

Bakerman1989 said:

K_S said:

Bakerman1989 said:

K_S said:

Bakerman1989 said:

Bakerman1989 said:

K_S said:

Bakerman1989 said:

Any idea on turnaround times for Halifax at the moment?  Our case manager (large national broker) initially said 5 working days almost two weeks ago and has now went almost completely silent on us

@bakerman1989 Has the valuation happened?

Can't speak for your specific application but generally speaking, Halifax are as fast as they usually are - most applications the valuation is instructed immediately (though for physical valuations there can be a delay depending on surveyor availability, access, etc.), processing/underwriting team picking applications up and raising queries up in 1-2 working days, turning around any responses in the same timescales. I've done 2 this month and they've both flown through, though both were fairly straightforward 95% LTV FTB PAYE apps.

So if it's been two weeks with no news it's either that underwriting is complete and they're waiting for the val to be done, or they've raised a query which is sitting with your broker and hasn't been responded to, or it's already gone to offer and you just haven't been told.

Thank you, @K_S.  Finally got an update from the broker that Halifax will update us today or tomorrow.  I'm thinking it must be at valuation as you say as they haven't asked for any more information from us. 

@K_S - turns out it's not valuation, but the fact that Halifax are looking to verify my wife's income. She is a contractor working for a council through an umbrella company.  Halifax have asked for 12 consecutive weeks payslips, but she has been off at least once every few months meaning that the most number of consecutive weeks we can provide is 10.  We're trying to get an employment contract for the umbrella company in lieu of the payslips.  My question - how common sense are Halifax likely to be here?  Is there a way for the broker to escalate it to someone once we provide all the information?  We're told there are no issues re. affordability and we can, if needed, provide 12 months worth of payslips and hopefully an employment contract.

@bakerman1989 Halifax have a pretty clear cut way of calculating income for day-rate contractors paid through umbrella PAYE.

Off of the top of my head, it's the lower of income calculated as follows -

Contract income: day-rate X days/week X 46

Payslip income: gross pay on latest month's (or 4/5 weeks if weekly) payslip adjusted to 46 weeks. Can't remember if it's 4 or 5 weeks.

I wouldn't worry too much, assuming that your broker knew that your wife was a day-rate umbrella contractor and not a perm PAYE employee, they would have done the above calcs and made sure it all aligns to criteria before recommending Halifax.

Thanks again @K_S - it's not so much the affordability we're worried about; it's the inflexibility of the underwriter by insisting on 12 weeks consecutive payslips.  If I speak direct to my broker (instead of the case manager) can he jump on a call with the underwriter to explain, and how receptive are underwriters generally to common sense?  If checklist criteria is 12 consecutive weeks payslips as evidence, do they have any discretion?

@bakerman1989 I think there's some misunderstanding here, perhaps caused by the case manager wrongly interpreting the underwriter query and/or not understanding how contractor income works. Also, I'm assuming here that your wife's income has been keyed in as a contractor and not as a perm PAYE employee.

Underwriters know that day-rate contractors take time off and that there may be no payslip issued for weeks that they don't submit a timesheet, hence the assumption of 6 weeks without income a year.

So if they've asked for the latest 12 weeks payslips and all you can provide is payslips for 10/12 weeks, then that should be absolutely fine, they may just adjust the affordability accordingly if warranted. And if affordability isn't an issue in this case then there shouldn't be anything to worry about.

I can't speak for the outcome of your particular case as I know nothing about it, but I've done plenty of contractor cases who've had gaps (both between contracts and within contracts, say over Christmas or summer) and other than the impact on affordability, I've never had a lender decline a case for a reason like in your case, where it meets criteria.

@K_S I'm getting the feeling that the case manager may have misinterpreted the underwriter's query as we were clear with the broker that my wife is a contractor from the start. The initial information request was for x5 consecutive weeks of payslips, which we couldn't provide due to wife being off over xmas. We were then asked to provide a letter from wife's employer confirming reason for the missing payslip along with 12 weeks of payslips, which we did.  Somewhere along the process the information request has turned into x12 consecutive weeks of payslips, which we can't provide due to wife being off at least once in every 12 weeks (although still worked 46 weeks in the year). We have now uploaded 7 months' of payslips, a letter from employer confirming no work = no payslip and the employment contract.  It just seems to me this could all have been sorted out with a phone call.

@bakerman1989 I'm probably missing something obvious here as a lot of the above doesn't appear to correspond to how a contractor income would be underwritten or packaged. 

I'm curious as to what has happened here out of professional interest, so please do close the loop when you get to the bottom of this. Good luck!

@K_S it turns out my wife's payslips were the issue as they list different types of payment from the umbrella company.  The underwriter was confused, but we explained and got it sorted over the phone.  Sent for valuation today I am told, although they have raised an additional query around renewal of my wife's contract. Do Halifax have a minimum requirement?  My wife works on 3 month contracts and has done since Jan 22, with the next renewal due at the end of March.