Mortgage broker - ask me anything

K_S

evosy1978 said:

Hi.  Me and the ex have a mortgage which has 10 years left.  I want to buy her out.   Nationwide have said i can remove her from the mortgage after they have checked my affordability and i pay a fee etc.  But i will need another £60,000 to pay her. Will they let me take out a new mortgage for the money i need and also keep my current mortgage? Instead of remortgaging.  The current mortgage is only 2% and has 5 years fixed left... cheers

@evosy1978 Assuming you meet Nationwide's affordability and criteria to borrow existing loan + 60k on your sole income, yes.

You will end up with two parts to your mortgage - the original one on the old rate and the additional borrowing of 60k on the current rate.

hayley_85

Hi, how bad does being in an overdraft look to the banks when remortgaging? I was in my overdraft for the month of February as I bought tickets to disneyworld (the website wouldnt accept my credit card as originally planned so had to use my debit card). I've been out of it since March but I know I'll need to show 3 months of bank statements so have been waiting till end of May before starting my remorgage applications but noticed that on my statements it shows the overdraft charges from the previous month so technically my March statement will still show I was in my overdraft the previous month. Am I best waiting till end of June before applying so 3 clear months of statements with no overdraft charges? My fixed deal runs out in August so I'd be cutting it a bit short leaving it so late but dont want to scupper my chances with a bank if they frown on people being in their overdrafts (albeit was only for that month!).

kingstreet

hayley_85 said:

Hi, how bad does being in an overdraft look to the banks when remortgaging? I was in my overdraft for the month of February as I bought tickets to disneyworld (the website wouldnt accept my credit card as originally planned so had to use my debit card). I've been out of it since March but I know I'll need to show 3 months of bank statements so have been waiting till end of May before starting my remorgage applications but noticed that on my statements it shows the overdraft charges from the previous month so technically my March statement will still show I was in my overdraft the previous month. Am I best waiting till end of June before applying so 3 clear months of statements with no overdraft charges? My fixed deal runs out in August so I'd be cutting it a bit short leaving it so late but dont want to scupper my chances with a bank if they frown on people being in their overdrafts (albeit was only for that month!).

One-off use of an arranged overdraft isn't normally an issue for most lenders.

kazzyb123

Hi,

we have a NatWest mortgage with 90K left to pay and would like to move but would need extra borrowing. House is worth approx 180. My partner is self employed and I have an illness which means I can’t work. We have remortgaged with NatWest because our deal finishes in August so would need to borrow extra from them and port the mortgage (5 year fix). I cant input our info on their website because we don’t fit normal circumstances.

 This is our current income

partner self employed profit 14K

Pip 8158 a year
Eas is 6115 a year
tax credits of 4492
child benefit of 1133 a year but my daughter is 16 now so these will stop in two and a half years time.
savings which I could add 20k to the pot. Current house is worth around 180/190K 

The other problem is that we can only have a 14 year term because of my partners age, he is 56 this year so that takes us to 70

Do you think we have any chance of NatWest lending us enough to buy something that will be approx 230K? We would need an extra 30k on top of now  so 120K

Thanks.

K_S

kazzyb123 said:

Hi,

we have a NatWest mortgage with 90K left to pay and would like to move but would need extra borrowing. House is worth approx 180. My partner is self employed and I have an illness which means I can’t work. We have remortgaged with NatWest because our deal finishes in August so would need to borrow extra from them and port the mortgage (5 year fix). I cant input our info on their website because we don’t fit normal circumstances.

 This is our current income

partner self employed profit 14K

Pip 8158 a year
Eas is 6115 a year
tax credits of 4492
child benefit of 1133 a year but my daughter is 16 now so these will stop in two and a half years time.
savings which I could add 20k to the pot. Current house is worth around 180/190K 

The other problem is that we can only have a 14 year term because of my partners age, he is 56 this year so that takes us to 70

Do you think we have any chance of NatWest lending us enough to buy something that will be approx 230K? We would need an extra 30k on top of now  so 120K

Thanks.

@kazzyb123 NatWest is one of the better mainstream lenders out there when it comes to accepting various benefits. However, when the benefits income exceeds the earned income then there's a significant amount of underwriter discretion involved. NatWest will consider CB, but with underwriter discretion depending on the age of the child. So for a 16 year old it likely won't be considered.

With respect to the term, if the applicant intends to work up to 75 or beyond and it is plausible (usually means a non-manual trade/occupation), NatWest will consider a term up to 75 so you could potentially go up to 19 years on term depending on your partner's trade.

But even with a 19 year term, assuming all the benefits are considered, and assuming no background debt or commitments besides the 1 dependent, I suspect you'll still end up 15-30k short of 120k based on the numbers you've shared. Unfortunately, lender affordability calculations have become significantly more restrictive over the past year due to rampant inflation and jump in rates, and this usually has a disproportionately larger impact lower down the income scale.

Try playing around with the NatWest affordability calculator here to see what kind of borrowing figures it's giving you.
https://spa.mortgages.natwest.com/calculator/residential-affordability

Good luck, I hope you're able to borrow what you need, either from NatWest or elsewhere!

dipsldn

haras_n0sirrah said:

Thought I would start a thread where people can ask the brokers opinion on things @ACG @LRmortgage @kingstreet @Deleted_User (any other brokers want to chip in - these were the main other brokers who came to mind.
It is definately an interesting market - probably the busiest I have ever been but at the same time lenders are sooo slow. 
Anyone got a question? Ask away

Hi, I am a director and the first year my company made a small loss, then second year a few thousand profit now it’ll make a small profit again. 

Am I able to get a 450k mortgage ? If I’m paying myself monthly around £3k and the company makes around £5k. Is this enough ? How much should I be making or paying myself through dividends or PAYE to meet the 450k criteria by lenders? Will I be applying for a company mortgage or is there something else that’s better for me ?

K_S

dipsldn said:

haras_n0sirrah said:

Thought I would start a thread where people can ask the brokers opinion on things @ACG @LRmortgage @kingstreet @Deleted_User (any other brokers want to chip in - these were the main other brokers who came to mind.
It is definately an interesting market - probably the busiest I have ever been but at the same time lenders are sooo slow. 
Anyone got a question? Ask away

Hi, I am a director and the first year my company made a small loss, then second year a few thousand profit now it’ll make a small profit again. 

Am I able to get a 450k mortgage ? If I’m paying myself monthly around £3k and the company makes around £5k. Is this enough ? How much should I be making or paying myself through dividends or PAYE to meet the 450k criteria by lenders? Will I be applying for a company mortgage or is there something else that’s better for me ?

@dipsldn Very very generally speaking, a ltd.co.Director's income will be calculated by the lender in one of the following ways -

- director's salary + dividends averaged over last two years OR
- director's salary + net-profit averaged over last two years

Mind you, this type of income is the most closely scrutinised by lenders as they need to assure themselves that the company is profitable, the dividends paid are supported by profits and the income is sustainable in the long term. And there are a lot of additional aspects to the above depending on the lender and other background details.

So assuming a very general loan-to-income multiple of 4.5x, to borrow 450k you'd need to evidence around 100k of annual income.

With respect to the kind of mortgage application, if you own 20-25%+ of the company, lenders will treat it as self-employed income as a ltd.co.director.

Sandyra

Hi

I’m expecting a new product transfer offer through the post from Santander. I couldn’t do it direct via their app as I’m close to 60% LTV so I opted to pay the difference. 

My phone is on its last legs. I have been managing on a PAYG sim only contract. My credit rating is excellent but just wanted to make sure by applying for Pay monthly the credit check wouldn’t affect my offer approval.

Thanks 

K_S

Sandyra said:

Hi

I’m expecting a new product transfer offer through the post from Santander. I couldn’t do it direct via their app as I’m close to 60% LTV so I opted to pay the difference. 

My phone is on its last legs. I have been managing on a PAYG sim only contract. My credit rating is excellent but just wanted to make sure by applying for Pay monthly the credit check wouldn’t affect my offer approval.

Thanks 

@sandyra I can't speak for your specific case, but generally speaking, with most mainstream lender PT scenarios, the state of the credit file is usually not a factor. 

Sandyra

Thank you @K_S for such a quick response.