Mortgage broker - ask me anything

carl2303

Hi all,

Myself and my partner have just had an offer accepted on a house for £180k and are looking to submit the mortgage application soon. We have a decision in principle with Natwest and I was wondering whether anyone has experience with this process? What documents do they ask for? Has anyone been declined after DIP approval? My partner has a near perfect credit score but I'm extremely worried my poor credit history (TransUnion - 565) will negatively affect the application. The main things I'm scared about is (1) I had several payday loans between 2017-2020 and (2) I have a few closed credit cards with one/two missed payment marks (3 years ago). All of the payday loans were paid on time but the volume of the loan usage worries me.  

My financial situation has completely changed since then, all I have is a personal (debt consolidation) loan and one credit card (total payments below). Our combined income is 65k and we have a deposit of 14% (£25.9k) and our current outgoings are £776.81.

Do you think we will get declined for a full mortgage because of my poor credit history? I'm very anxious about the process!

SuperExcelMan

Hi, I am after some advice please.

I currently have 6 months left with Lloyds - owe £19.9k, 2.48% fixed, £414 a month.

Have maxed overpayments for the year, so building up savings until Jan, where I’ll have £4k approx. Usual overpayment is £550 a month.

Priority to clear mortgage. So end of Jan, I could have £12k owing.

Lloyds will only give me a two year or five year fixed rate which I don’t need and would end up with penalties - the SVR has gone up to 8.49% currently.

Everyone else seems to want minimum £25k borrowing, which I don’t need.

Do I have any broker options other than suck it up on 8.49%, clear it at around £1k a month but pay high APR please?

Thanks

george4064

debtfreeohyeah said:

Hi team,

looking for some advice…

my wife and I have a mortgage AIP with Skipton via a broker.

We have a 55% deposit so are in a fortunate position. We’re considering putting an offer in on a property but there’s a few things to double check before we do (there’s some confusion with the EA as to whether it’s share of freehold or leasehold and we’d need to do work to the property).

My question is, during this process, I happen to have been offered a new role which is a dream company/position for me, an incredible move for me. But the role would involve a pay cut, I’m currently on £80K and the current job offer is at £73K. I’m in a fortunate position where I can take a hit month to month for this role fortunately but am looking to reduce the gap as much as possible so that we can borrow a bit more. I may be able to get the prospective new employer up to £75k. Once I know what the final offer on the table is, we will of course notify the broker and take their advice and get them to speak to the lender. But whether it’s £73k or £75k and they have to agree a new agreement - is this all a bit pointless because would they need me to have started that new job and be at least 3 months in with payslips/pass probation?

would taking this new role at whatever salary delay our search by a few months anyway do you think? 

I’d explain the situation to your broker. If they’re any good, they should know exactly what is/isnt possible and what you’d need to do.

K_S

debtfreeohyeah said:

Hi team,

looking for some advice…

my wife and I have a mortgage AIP with Skipton via a broker.

We have a 55% deposit so are in a fortunate position. We’re considering putting an offer in on a property but there’s a few things to double check before we do (there’s some confusion with the EA as to whether it’s share of freehold or leasehold and we’d need to do work to the property).

My question is, during this process, I happen to have been offered a new role which is a dream company/position for me, an incredible move for me. But the role would involve a pay cut, I’m currently on £80K and the current job offer is at £73K. I’m in a fortunate position where I can take a hit month to month for this role fortunately but am looking to reduce the gap as much as possible so that we can borrow a bit more. I may be able to get the prospective new employer up to £75k. Once I know what the final offer on the table is, we will of course notify the broker and take their advice and get them to speak to the lender. But whether it’s £73k or £75k and they have to agree a new agreement - is this all a bit pointless because would they need me to have started that new job and be at least 3 months in with payslips/pass probation?

would taking this new role at whatever salary delay our search by a few months anyway do you think? 

@debtfreeohyeah Skipton (like the vast majority of mainstream lenders) does not care about probationary period, as long as you have continuous employment of 6 months (any employers). 

They will consider using an applicants salary for a job that's yet to start but it'll be subject to discretion and they may withhold the full offer until the first payslip can be shared.

Given that you're only at AIP, changing to a new job should not be a showstopper as there are a decent number of mainstream lenders that are ok with considering based on new employment contract due to start soon. So unless your circumstances are such that you are limited to a couple of lenders for whatever reason, the broker should be able to place you.

K_S

SuperExcelMan said:

Hi, I am after some advice please.

I currently have 6 months left with Lloyds - owe £19.9k, 2.48% fixed, £414 a month.

Have maxed overpayments for the year, so building up savings until Jan, where I’ll have £4k approx. Usual overpayment is £550 a month.

Priority to clear mortgage. So end of Jan, I could have £12k owing.

Lloyds will only give me a two year or five year fixed rate which I don’t need and would end up with penalties - the SVR has gone up to 8.49% currently.

Everyone else seems to want minimum £25k borrowing, which I don’t need.

Do I have any broker options other than suck it up on 8.49%, clear it at around £1k a month but pay high APR please?

Thanks

@superexcelman I don't know of any brokers that would do a mortgage for such a tiny amount, perhaps check with Habito or L&C. The MSE mortgage finder should give you the vast majority of any broker options out there. 

Alternatively, you could take out a 25k remortgage (with another lender) on a no fee no ERC free legals free valuation tracker/discount product and then pay off as much as you want on day 1 after completion.

silvercar

SuperExcelMan said:

Hi, I am after some advice please.

I currently have 6 months left with Lloyds - owe £19.9k, 2.48% fixed, £414 a month.

Have maxed overpayments for the year, so building up savings until Jan, where I’ll have £4k approx. Usual overpayment is £550 a month.

Priority to clear mortgage. So end of Jan, I could have £12k owing.

Lloyds will only give me a two year or five year fixed rate which I don’t need and would end up with penalties - the SVR has gone up to 8.49% currently.

Everyone else seems to want minimum £25k borrowing, which I don’t need.

Do I have any broker options other than suck it up on 8.49%, clear it at around £1k a month but pay high APR please?

Thanks

Would an offset mortgage be an option? Take £25k and immediately put £14k into the offset savings account, so you only pay interest on the balance. Rates may be slightly higher than the cheapest around, but it would still be cheaper than SVR.

SuperExcelMan

silvercar said:

SuperExcelMan said:

Hi, I am after some advice please.

I currently have 6 months left with Lloyds - owe £19.9k, 2.48% fixed, £414 a month.

Have maxed overpayments for the year, so building up savings until Jan, where I’ll have £4k approx. Usual overpayment is £550 a month.

Priority to clear mortgage. So end of Jan, I could have £12k owing.

Lloyds will only give me a two year or five year fixed rate which I don’t need and would end up with penalties - the SVR has gone up to 8.49% currently.

Everyone else seems to want minimum £25k borrowing, which I don’t need.

Do I have any broker options other than suck it up on 8.49%, clear it at around £1k a month but pay high APR please?

Thanks

Would an offset mortgage be an option? Take £25k and immediately put £14k into the offset savings account, so you only pay interest on the balance. Rates may be slightly higher than the cheapest around, but it would still be cheaper than SVR.

Would that be allowed? Certainly seems a fresh option

silvercar

SuperExcelMan said:

silvercar said:

SuperExcelMan said:

Hi, I am after some advice please.

I currently have 6 months left with Lloyds - owe £19.9k, 2.48% fixed, £414 a month.

Have maxed overpayments for the year, so building up savings until Jan, where I’ll have £4k approx. Usual overpayment is £550 a month.

Priority to clear mortgage. So end of Jan, I could have £12k owing.

Lloyds will only give me a two year or five year fixed rate which I don’t need and would end up with penalties - the SVR has gone up to 8.49% currently.

Everyone else seems to want minimum £25k borrowing, which I don’t need.

Do I have any broker options other than suck it up on 8.49%, clear it at around £1k a month but pay high APR please?

Thanks

Would an offset mortgage be an option? Take £25k and immediately put £14k into the offset savings account, so you only pay interest on the balance. Rates may be slightly higher than the cheapest around, but it would still be cheaper than SVR.

Would that be allowed? Certainly seems a fresh option

Definitely allowed. When we moved, we took 40% more than we needed, just as a buffer having wiped out our savings to make the move. On a low LTV it should be fine, though they may ask why you need to extra, but saying you want it as a buffer should be fine. 

homesaver234

Have you found any way to get Nationwide or Barclays to honour their comittment to provide the new Mortgage Charter switch to interest-only?

Both have refused me. Nationwide even denied it has agreed to the charter, saying the Govt. info that it has agreed is wrong!

silvercar

homesaver234 said:

Have you found any way to get Nationwide or Barclays to honour their comittment to provide the new Mortgage Charter switch to interest-only?

Both have refused me. Nationwide even denied it has agreed to the charter, saying the Govt. info that it has agreed is wrong!

The charter applies to existing lenders. Who is your mortgage provider currently?