Staircasing query

Trentham

Good evening all,

I was looking for some advice for staircasing under shared ownership. I’m not the best with these things so I apologise for any naivety below.

We moved into our property in August 2019 with a mortgage for a 35% share. The mortgage is with Kent Reliance with a 5 year fixed rate. We’re hoping to staircase (to at least a 50% share, hopefully more) and wanted to ask advice from anyone that’s done this before. In my mind, we have a few options:

1. Wait until next year when the fixed rate ends and renegotiate our mortgage with Kent Reliance to purchase more shares in the property.
2. Transfer our mortgage to our main bank (Halifax). Not sure if this is possible, especially with us wanting to purchase more shares. From what I gather if this is possible then it would still be better to wait until the fixed rate ends next year.
3. Leave the mortgage with Kent as it is and take out a second mortgage with another provider for the additional shares.

I’ve read through my mortgage agreement and various websites for advice but I’m having trouble getting my head around it. Has anyone been through this process before and has any advice about the best way to proceed?

Thanks for reading.

K_S

@Trentham

1. If you're looking to do a capital raise re-mortgage, you're going to need to go through a full income-affordability-credit-check process for that so there's no real reason to stick to Kent and pay (say) 6% rather than the 4-4.5% it would be with a mainstream lender. 

2. A handful of mainstream lenders do allow capital raise SO re-mortgages for staircasing so it might be worth exploring that option. You should definitely consider speaking to a mortgage broker to see what's available to you, the MSE guide here can help you find one, you could ask friends/family/colleagues for a recommendation or speak to a broker you've previously used and liked. You want to start the process 6 months before expiry of your fixed rate as most mortgage offers will be valid for 6 months and SO mortgages can take a long time for conveyancing work.

3. Unfortunately, you can't do that with standard first-charge mortgages, you would need both parts to be with the same lender.

Good luck, I hope you get what you need!

Trentham said:

Good evening all,

I was looking for some advice for staircasing under shared ownership. I’m not the best with these things so I apologise for any naivety below.

We moved into our property in August 2019 with a mortgage for a 35% share. The mortgage is with Kent Reliance with a 5 year fixed rate. We’re hoping to staircase (to at least a 50% share, hopefully more) and wanted to ask advice from anyone that’s done this before. In my mind, we have a few options:

1. Wait until next year when the fixed rate ends and renegotiate our mortgage with Kent Reliance to purchase more shares in the property.
2. Transfer our mortgage to our main bank (Halifax). Not sure if this is possible, especially with us wanting to purchase more shares. From what I gather if this is possible then it would still be better to wait until the fixed rate ends next year.
3. Leave the mortgage with Kent as it is and take out a second mortgage with another provider for the additional shares.

I’ve read through my mortgage agreement and various websites for advice but I’m having trouble getting my head around it. Has anyone been through this process before and has any advice about the best way to proceed?

Thanks for reading.

Trentham

Thank you very much, the above is tremendously helpful @K_S