Cash house purchase then mortgage/loan

u05sdb

It seems like we're close to having our cash offer accepted on a house. If we did want to add secured borrowing once we moved in, it looks like we would have to wait 6 months from the entry date, or at least until the title deeds had been registered before we could apply. I had thought that this 6 months only applied for those who purchased with a mortgage and not cash buyers. Can anyone confirm that this is true in either case?

And would this restriction also apply to non-secured borrowing like a home improvement loan or other type or personal loan or would we maybe even be able to apply in advance of moving in?

K_S

@uo5sdb The easy question first - As there's no mortgage involved, taking out unsecured-borrowing (credit card, personal loan, etc.) will not be directly impacted by your purchase.

With respect to mortgaging your property after completion to release cash, there are a decent number of mainstream lenders that will consider lending without needing to wait for 6 months. I'm not fully sure how the current delays at LR may impact that, your solicitor might be able to tell you.

user1977

K_S said:

I'm not fully sure how the current delays at LR may impact that, your solicitor might be able to tell you.

The six months would run from the date of the original application for registration, not whenever the LR finishes processing the registration. So in that sense any delays would be irrelevant. Though (leaving aside the 6 month rule) some lenders/conveyancers prefer not to deal with any titles which have pending applications for registration - but applications can be expedited if necessary.

K_S

user1977 said:

K_S said:

I'm not fully sure how the current delays at LR may impact that, your solicitor might be able to tell you.

The six months would run from the date of the original application for registration, not whenever the LR finishes processing the registration. So in that sense any delays would be irrelevant. Though (leaving aside the 6 month rule) some lenders/conveyancers prefer not to deal with any titles which have pending applications for registration - but applications can be expedited if necessary.

@user1977 That's correct, the 6 months is usually from the completion date.

The lender specifics for Day 1 remos are usually clearly set-out in the criteria. For example lender 1 doesn't care about 6 months but requires that "Property must be registered in applicants name at Land Registry" at the point of application while lender 2 is fine with a Day 1 remo if bought with cash/bridging, etc. A couple of smaller BSs even require that the applicant use the same solicitor as was used for the purchase if within 6 months.

Lots of nit-picky criteria for Day 1 remos but from the limited info in the OP's post, they shouldn't have an issue placing this with a mainstream lender simply due to the day 1 remo aspect.

u05sdb

Thank you, that was very helpful. I've now spoken to 3 big lenders and they didn't have any reason not to apply immediately. I guess the three providers who I spoke to initially were not representative of all.

kingstreet

user1977 said:

K_S said:

I'm not fully sure how the current delays at LR may impact that, your solicitor might be able to tell you.

The six months would run from the date of the original application for registration, not whenever the LR finishes processing the registration. So in that sense any delays would be irrelevant. Though (leaving aside the 6 month rule) some lenders/conveyancers prefer not to deal with any titles which have pending applications for registration - but applications can be expedited if necessary.

FWIW we couldn't come up with what was needed to have a first registration expedited recently.

"You will need to provide evidence which clearly shows why you are asking us to expedite your application. We will use your evidence to make it easier for us to determine if we can approve your request.

Examples of evidence we accept include:

• a copy of the sale or purchase contract or a mortgage offer letter confirming the offer’s expiry date
• a clear explanation in cases of problems or hardship which should link to the need for the registration to be completed."

We were unable to even begin a transaction with the registration pending.

K_S

kingstreet said:

user1977 said:

K_S said:

I'm not fully sure how the current delays at LR may impact that, your solicitor might be able to tell you.

The six months would run from the date of the original application for registration, not whenever the LR finishes processing the registration. So in that sense any delays would be irrelevant. Though (leaving aside the 6 month rule) some lenders/conveyancers prefer not to deal with any titles which have pending applications for registration - but applications can be expedited if necessary.

FWIW we couldn't come up with what was needed to have a first registration expedited recently.

"You will need to provide evidence which clearly shows why you are asking us to expedite your application. We will use your evidence to make it easier for us to determine if we can approve your request.

Examples of evidence we accept include:

• a copy of the sale or purchase contract or a mortgage offer letter confirming the offer’s expiry date
• a clear explanation in cases of problems or hardship which should link to the need for the registration to be completed."

We were unable to even begin a transaction with the registration pending.

@kingstreet From what I see on Cherry (for the benefit of non-broker forumites, that's a mortgage-broker web forum), it sounds like LR will expedite more readily for purchase apps than they will with remos. Thankfully, never had to get involved in a request to expedite yet, the solicitor handled it.