Mortgage broker - ask me anything

K_S

Logan72 said:

Grateful for some advice/thoughts on the two questions below...thanks very much.

I own two houses (no mortgages on either now).  I live in one and my parents in the other.

Can I re-mortgage the one I don’t live in (rather than the one I do) to give me additional capital in the short term?

If I wanted to sell my home to buy another of higher value outright (to live in), could I take out a mortgage on the house my parents live in (rather than the new one) to fund the difference in price?

@logan72 Yes, you could do that. As far as the mortgage mechanics are concerned, there are plenty of options out there to potentially release cash on either property.

In practice, what options you have will depend on the specifics - what is the arrangement with your parents, what kind of product you need, how much, what LTV, what the borrowed funds will be used for, what kind of income you have, debt/outgoings, any other relevant factors, etc etc.

Logan72

@logan72 Yes, you could do that. As far as the mortgage mechanics are concerned, there are plenty of options out there to potentially release cash on either property.

In practice, what options you have will depend on the specifics - what is the arrangement with your parents, what kind of product you need, how much, what LTV, what the borrowed funds will be used for, what kind of income you have, debt/outgoings, any other relevant factors, etc etc.

Thanks so much for the info and responding so quickly.  I understand it's an atypical situation and I accept a lower LTV but good to know it's possible.  I'd also want interest only repayments as it would be about releasing as much cash from the property sooner rather than later.  There'd be a few other relating financial inputs so I think I'd definitely benefit from a broker and/or financial advisor!  Thank you again @K_S

MossyJ

When does your current lender work out LTV % for renewing mortgage?

Currently on a fixed rate which finishes at the end of November, so not too long until I get an offer from our current lender.

We've been overpaying and got the LTV down to 76%. Our monthly overpayments would get that down to 75% by the end of the fixed term, but will they take that into account when making an offer, or do we need to get it down to 75% before the offer?

Thanks!

K_S

MossyJ said:

When does your current lender work out LTV % for renewing mortgage?

Currently on a fixed rate which finishes at the end of November, so not too long until I get an offer from our current lender.

We've been overpaying and got the LTV down to 76%. Our monthly overpayments would get that down to 75% by the end of the fixed term, but will they take that into account when making an offer, or do we need to get it down to 75% before the offer?

Thanks!

@mossyj It depends on the lender as the mechanics can differ slightly. So best speak to the lender to make sure you get it right.

Also keep in mind that most lenders will update the HPI (house price index) every quarter or so and that can have a positive/negative impact on the LTV as well if you haven't secured a product by then. For example Halifax will update it's index in mid-April and it's expected to drop compared to the previous quarter, so someone who was just inside the 60% LTV band might end up just outside it after the HPI has been updated.

RichMo90

Hi,

I am currently on a debt payment plan (Scotland) which still has about 3 years to run. My mortgage is up
for renewal in August. I was wondering if there’s any possibility or is it even worth while asking for additional funds in my remortgage for home improvements. 

I bought my home for £95,000 and mortgage will be around £75,000 left to pay come renewal, with house currently valued at £106,000.

I would just be asking for £5000 to £7000 in additional borrowing for some home improvements and to pay off £1500 which would roughly be left on my car finance come then (and would allow me to start paying £200 extra to my DPP a month).

Just looking for advice as to whether there’s lenders out there that would even consider giving someone on a DPP additional funds when remortgaging.

thanks 

K_S

RichMo90 said:

Hi,

I am currently on a debt payment plan (Scotland) which still has about 3 years to run. My mortgage is up
for renewal in August. I was wondering if there’s any possibility or is it even worth while asking for additional funds in my remortgage for home improvements. 

I bought my home for £95,000 and mortgage will be around £75,000 left to pay come renewal, with house currently valued at £106,000.

I would just be asking for £5000 to £7000 in additional borrowing for some home improvements and to pay off £1500 which would roughly be left on my car finance come then (and would allow me to start paying £200 extra to my DPP a month).

Just looking for advice as to whether there’s lenders out there that would even consider giving someone on a DPP additional funds when remortgaging.

thanks 

@richmo90 There are lenders like Vida who say that they will consider applicants with an active DAS subject to underwriting and conduct. Might be worth looking into if you're already with an adverse lender.

If you intend to raise cash to pay off the DAS in full, then some other lenders will also consider.

If you're currently with a mainstream lender, you may want to also look at doing a product-switch/rate-switch (staying with the current lender) and then exploring other options like second charge to raise the extra funds.

Best speak to an adverse-experienced mortgage broker, they'll look at the pertinent details and be able to tell you pretty quick if it's a no-go.

MossyJ

K_S said:

MossyJ said:

When does your current lender work out LTV % for renewing mortgage?

Currently on a fixed rate which finishes at the end of November, so not too long until I get an offer from our current lender.

We've been overpaying and got the LTV down to 76%. Our monthly overpayments would get that down to 75% by the end of the fixed term, but will they take that into account when making an offer, or do we need to get it down to 75% before the offer?

Thanks!

@mossyj It depends on the lender as the mechanics can differ slightly. So best speak to the lender to make sure you get it right.

Also keep in mind that most lenders will update the HPI (house price index) every quarter or so and that can have a positive/negative impact on the LTV as well if you haven't secured a product by then. For example Halifax will update it's index in mid-April and it's expected to drop compared to the previous quarter, so someone who was just inside the 60% LTV band might end up just outside it after the HPI has been updated.

NatWest's HPI has been helping get that LTV % down nicely, but I have been wondering if it may start going that other way... looking for a longer fix this time so guess best give ourselves a little buffer rather than living on the edge! Thanks.

bubby08

Hi, I wonder if you can help, I am considering Business Car Lease or BCP. My question is would this be subject to a personal hard credit search as well as a business hard credit search and would the lease have adverse affect my ability to obtain a personal mortgage.

many thanks 

K_S

bubby08 said:

Hi, I wonder if you can help, I am considering Business Car Lease or BCP. My question is would this be subject to a personal hard credit search as well as a business hard credit search and would the lease have adverse affect my ability to obtain a personal mortgage.

many thanks 

@bubby08 Hard check - assuming it's a close company any finance will almost certainly be based on the Director's credit-worthiness so on that basis I would assume there'd be a personal credit check, same as it you were taking out a Ltd Co BTL mortgage. Just a logical assumption, I've no idea of the application process for a business car lease.

Impact on mortgage - depends on if it shows on your credit report, what income you're using to qualify for the mortgage, whether or not the lease outgoing will be considered a business expense, etc.

bubby08

Thank you very much that’s very helpful I was planning to use it as a business expense not sure if that makes it better or worse in terms of mortgage.