Mortgage broker - ask me anything

kingstreet

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

Ian_B_B

kingstreet said:

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

Understood - thanks!  Given that house prices look like they are dropping a bit, interest rates are likely to remain fairly high, it feels like maybe sticking is better than twisting...  Sorry, this leads onto two more questions....

Is my base assumption that once I move into year six of the HTB agreement, I start paying interest, and that is at 1.75% initially (for the first year at least)...

If I took the path of least resistance, and stay with my current lender (Halifax) on a new two year fix, do I need to do much by way of new applications / credit checks, or can it be as simple as clicking a button... 

Thanks again!!

silvercar

Ian_B_B said:

kingstreet said:

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

Understood - thanks!  Given that house prices look like they are dropping a bit, interest rates are likely to remain fairly high, it feels like maybe sticking is better than twisting...  Sorry, this leads onto two more questions....

Is my base assumption that once I move into year six of the HTB agreement, I start paying interest, and that is at 1.75% initially (for the first year at least)...

If I took the path of least resistance, and stay with my current lender (Halifax) on a new two year fix, do I need to do much by way of new applications / credit checks, or can it be as simple as clicking a button... 

Thanks again!!

1.75% is the lowest interest rate you are going to get anywhere other than short term 0% credit card deals. 

General advice to decrease debt is to throw money at the highest interest rate first, so unless you think house prices are going to increase rapidly, you would be better off tackling other debts and keeping your HTB loan. This does stop you consolidating debt, but you would need a lot of debt at a high interest rate to make it worth consolidating the debt and HTB.

 Given you can’t consolidate the debt without dealing with the HTB, you really only have 2 options. Consolidate the lot onto a new 85% mortgage, or leave the HTB as is, go on a new fix mortgage deal and at the same time tackle your other debt. I’d do the latter, unless I felt my house price was going to increase rapidly in the next 2 years.

(I’m not an advisor or a debt expert, just my gut feeling).

K_S

Ian_B_B said:

kingstreet said:

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

If I took the path of least resistance, and stay with my current lender (Halifax) on a new two year fix, do I need to do much by way of new applications / credit checks, or can it be as simple as clicking a button... 

Thanks again!!

@ian_b_b If you do a product-switch (staying with current lender) with no change in loan size or term, then there'll be no credit/affordability checks, just a few clicks online. https://www.halifax.co.uk/mortgages/existing-customers/switch-to-a-new-deal.html

Ian_B_B

K_S said:

Ian_B_B said:

kingstreet said:

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

If I took the path of least resistance, and stay with my current lender (Halifax) on a new two year fix, do I need to do much by way of new applications / credit checks, or can it be as simple as clicking a button... 

Thanks again!!

@ian_b_b If you do a product-switch (staying with current lender) with no change in loan size or term, then there'll be no credit/affordability checks, just a few clicks online. https://www.halifax.co.uk/mortgages/existing-customers/switch-to-a-new-deal.html

Thanks!  Would I need to tell them I’m on htb, or in this case does it make no difference?!  Thanks!!

K_S

Ian_B_B said:

K_S said:

Ian_B_B said:

kingstreet said:

Ian_B_B said:

kingstreet said:

Ian, you won't be able to borrow to do debt con with the HTB loan left in-situ. The HTB Agent won't agree to it. Some lenders ignore debt being repaid, others don't. A decent broker will know who to avoid in such circumstances.

A broker can give you the facts on repaying or not repaying the HTB loan but won't make a recommendation as such. Much of the decision surrounds property prices. If they are rising, it may make the decision to repay an HTB loan easier. If they are static or falling, the interest rate differential between HTB and mortgage rate is perhaps more relevant.

Thanks ever so much!  In a fairly generic case like mine - 20% HTB on £340k mortgage, house now worth £400k - £200k left on the mortgage, what would you recommend to a client?  I’m going to speak to a broker, but interested in your views!  Thanks!!

Like I said, I wouldn't. However, what is happening to property values would have a major bearing on how to proceed.

If I took the path of least resistance, and stay with my current lender (Halifax) on a new two year fix, do I need to do much by way of new applications / credit checks, or can it be as simple as clicking a button... 

Thanks again!!

@ian_b_b If you do a product-switch (staying with current lender) with no change in loan size or term, then there'll be no credit/affordability checks, just a few clicks online. https://www.halifax.co.uk/mortgages/existing-customers/switch-to-a-new-deal.html

Thanks!  Would I need to tell them I’m on htb, or in this case does it make no difference?!  Thanks!!

@ian_b_b If you’re doing an online product-switch with your current lender, thr system will automatically only show products that you’re eligible for.

Ian_B_B

Thanks ever so much for all your help!  Think I have a plan!!

Penguin_

Good morning all

Hoping someone can just put something in plain & simple terms for me if possible.

Was talking to a colleague about housing & they asked would my partner & I be looking to buy a new home after we get married. (We both currently live in a house which I own, bought before we met). I replied yes, probably look to move a bit closer to her work. 

They then asked if we'd considered using money in our house to buy a new house then rent the current one out? 

We currently owe £71,000 on the mortgage with the house being valued at £135,000, current mortgage payment is £298 pm - recent valuation from agents.

How would that it work? As in the plan was for us to sell the house & then use the £64,000 as deposit on a house but unsure how we could keep the existing house & get a new one.

K_S

Penguin_ said:

Good morning all

Hoping someone can just put something in plain & simple terms for me if possible.

Was talking to a colleague about housing & they asked would my partner & I be looking to buy a new home after we get married. (We both currently live in a house which I own, bought before we met). I replied yes, probably look to move a bit closer to her work. 

They then asked if we'd considered using money in our house to buy a new house then rent the current one out? 

We currently owe £71,000 on the mortgage with the house being valued at £135,000, current mortgage payment is £298 pm - recent valuation from agents.

How would that it work? As in the plan was for us to sell the house & then use the £64,000 as deposit on a house but unsure how we could keep the existing house & get a new one.

@penguin_ It’s called a ‘Let To Buy’ transaction where you intend to let the property that you currently live in (Mortgage 1 - BTL remortgage) and buy a new property to live in (Mortgage 2 - Residential purchase mortgage). Generally speaking, the expectation will be for both of the above completions to happen simultaneously.

This thread might help expand on the above
https://forums.moneysavingexpert.com/discussion/6254130/let-to-buy

fullofcold

More of a moan than any advice required (unless you have any guidance as to get a poker up them).  Santander.  Have had to do a further advance with them.  Told to do it online as the process is quicker.  Queried the valuation (which I knew would delay somewhat) and now the MATs system has had a dicky fit.  Received an email last Friday advising me that I was being offered the lower amount.  After we accepted the lower borrowing were told we would receive the mortgage offer shortly.  Called when I didn't receive the offer on Wednesday and was told that the offer had not been issued due to a technical problem and now we are back stuck at 'valuation reviewed' stage.  How do I expedite this?  Getting really frustrated now and it reminds me why I moved to insurance instead of broking mortgages still.