Can’t renew our fixed mortgage

Cuxtongirl149

Our mortgage is up for renewal at the end of August. It’s for just over 300K. 

We’ve always gone through a broker, who has been great at securing us a good deal - he’s done this several times already. Initially, he found us a deal, we signed the paperwork etc, but it’s now fallen through - he doesn’t know if we are going to be able to fix - apparently lots of his clients are in the position. We are now having to wait to see if things change. We may have to go on to a tracker - which is going to be very difficult for us afford. At the moment, things are just about comfortable for us, as we’re doing some renovations on our house. 

We think we can just about manage it by cutting back on everything, including holidays, kids swimming lessons etc. It’s really miserable. Both of us work very stable public sector jobs earning in the £40K range. 

Has anyone got any ideas? We’re probably going to call our lender when it gets to the 3 month mark. 

MorningcoffeeIV

Why do you not believe you can fix?

comeandgo

Is that £40 k each?  Can one of you get a small part time job to increase your wages?  Or get a mortgage for 30 or  40 years?

Cuxtongirl149

MorningcoffeeIV said:

Why do you not believe you can fix?

Our broker has just told us to sit tight and we’re assuming the worst. He’s implied but not said explicitly. 

Cuxtongirl149

comeandgo said:

Is that £40 k each?  Can one of you get a small part time job to increase your wages?  Or get a mortgage for 30 or  40 years?

Yes, 40K+ each. I’m a teacher and do cash in hand tutoring on the side. Partner is doing as much overtime as is available, but it’s sporadic, unfortunately.

Thanks so much for replying.

ruelle

How come you can't fix? If it's an affordability issue you can do a rate switch with your current lender that doesn't require any checks whatsoever. I think with some lenders you can do this 6 months in advance.

Cuxtongirl149

ruelle said:

How come you can't fix? If it's an affordability issue you can do a rate switch with your current lender that doesn't require any checks whatsoever. I think with some lenders you can do this 6 months in advance.

Really? It might be worth us calling them, even if before the 3 months. Definitely will try that. Our broker is really good, I’m not sure why he wouldn’t have suggested this. 

With the refix, we added 5 years to reduce the monthly, then we’d reduce after the two years. 

molerat

https://uk.finance.yahoo.com/news/lenders-pull-hundreds-mortgages-economists-155235514.html

K_S

Cuxtongirl149 said:

Our mortgage is up for renewal at the end of August. It’s for just over 300K. 

We’ve always gone through a broker, who has been great at securing us a good deal - he’s done this several times already. Initially, he found us a deal, we signed the paperwork etc, but it’s now fallen through - he doesn’t know if we are going to be able to fix - apparently lots of his clients are in the position. We are now having to wait to see if things change. We may have to go on to a tracker - which is going to be very difficult for us afford. At the moment, things are just about comfortable for us, as we’re doing some renovations on our house. 

We think we can just about manage it by cutting back on everything, including holidays, kids swimming lessons etc. It’s really miserable. Both of us work very stable public sector jobs earning in the £40K range. 

Has anyone got any ideas? We’re probably going to call our lender when it gets to the 3 month mark. 

@Cuxtongirl149 Who is your lender?

Unless you're with a specialist lender that doesn't offer PTs (product transfer / product switch / rate switch) for existing customers, it sounds like you may have misunderstood something.

If you're with a mainstream lender, you should be able to select a fixed rate from that lender's PT range without any affordability checks or credit checks. To take an extreme example, even if you both were unemployed or had 50k credit card debt, that option would still be available. The vast majority of mainstream lenders will allow brokers to do PTs as well so usually this would be part of the options that the broker advises on.

I'm assuming you have some background debt, car payments, etc.? If not then on a combined income of 80k, you *should* be able to meet affordability for 300k (<4x income) with plenty of lenders. For like for like remortgages, a few mainstream lenders have recently upped their max LTI (loan to income) to 6-6.5x, to be able to lend in scenarios where a remo is failing affordability.

Given that you have a good broker, it's very very unlikely that they wouldn't have considered the above so there's probably something else pertinent in the background that's causing an issue so if you're not clear on what exactly is causing an issue, might be worth asking them.

If it's one of the volume brokers, then it might be worth getting a second opinion as well. You can ask friends/family/colleagues for recommendations.

At8

Would the broker still get a commission if they recommended a product transfer / product switch / rate switch? 

K_S

At8 said:

Would the broker still get a commission if they recommended a product transfer / product switch / rate switch? 

@at8 Yes, the vast majority of lenders do pay 'commission' (it's called procuration-fee) on broker PTs.