Need some Professional Advice

skyjumper

thanks Jill,

could you please explain what u mean by " if you leave it till after completion, there may be a penalty to pay" i mean they had given me an offer for which they charged me an arrangement fee £599, even without actually lending me any money at all. so when i ask them to renew this with a lesser amount, do u mean i may have to pay the penalty right now ?

homer_j_3

what she is saying is that if you were to send back the amount you dont need then you could be charged on what would be classed as an overpayment

skyjumper

thanks Homer J

sorry for being so dump and asking silly questions here. If they haven't actually given me the mortgage, but have given me an offer , would i then be entitled to ask them for a lesser amount without any repayment charges.
i know they have already given out my mortgage offer which id due for renewal in a few weeks time, but just wanted to know this

i hope my question is clear

thanks

jill2002

Hi,

Sorry, I will make myself clearer. You can either borrow less now OR if they want to still lend you the same amount (the higher amount), then you have an option of paying a lump sum off your mortgage once you have the mortgage - some companies charge you a penalty to do this - once the mortgage is arranged and the house is yours, some allow you to repay 10% of the mortgage balance with out penalty.

But of course the best option would be to borrow the lower amount and then there will be no problem with penalties. Take care asking your Mortgage advisor this question as he/she may be on commission which is paid out on the amount borrowed - obviously if the amount you borrow is lower, then his/her commission will be less. I am sure most mortgage advisors would not even consider this, but then most mortgage advisors would not have sold you a deal that had a completion end date shorter than you need !!

skyjumper

hi Jill

say i need a mortgage for the property which will only be completed in Sept 2008, but need the mortgage offer by the 10th of March ( the completion date > 6 months time) how do i do this? i mean i noticed in the privious post that the mortgage offer only lasts for 6 months and then the lender would want to reconsider this and that's why i'm going in for a renewal, even though the property is still not ready.
any thoughts?

jill2002

Skyjumper,

The mortgage offer would have to be renewed after 6 months (but you would still be able to stay on the same 'deal') I'm afraid it's a chance you take and hopefully your circumstances will not have changed in that time or the criteria changed.

This really should have been discussed with your mortgage broker and solicitor. Remember, now you have exchanged contracts you have to buy this property unless you forfeit your deposit (have you paid a deposit?).

I wouldn't worry though, it's usual practice and as long as your circumstances haven't changed it's normally just a press of a button for the mortgage broker/lender to reauthorise the mortgage.

skyjumper

hi jill,

just putting my figures here so that you could have a look at them.
yes i had paid a non re fundable deposit of £10,000 at the time of exchange of contracts. the other figures are as below.


price of the property £152500
incentives and FTB discount £ 12200
booking fee £250
Survey fee £360 ( i paid from my own pocket)
Solicitors fee £2600 (including 1% stampduty fee)
arragement fee £599(already paid to the bank at the time of mortgage offer)
Deposit paid at the time of
exchange of contract £10000
mortgage offer for £124500

i'm asking all this is coz my IMA was a independent whole of the market with no fees charged as Martin suggests, but is never there if i need to ask a simple clarification. i need to think if i need to change mine as she is mostly away on holidays- may be she's very successful and makes a lot of money
i'm not sure- and not trying to judge her- but as it's my money which is spent on all this i would like to be more careful

jill2002

So let me get this right - I think I may be missing something .....

Purchase price £152500
incentives and FTB discount £ 12200
Does that now make the actual purchase price £140,300 ?????
Deposit £10,000 (paid at exchange of contracts)
That leaves £130,300 to pay
You are getting a mortgage of £124,500

I make that £5,800 short ????

Also, what is the booking fee £250 for? What are you booking ?
You've also paid an arrangement fee £599- this, I assume is to 'buy' the rate with A&L

homer_j_3

there is probably money in her savings for the difference.

jill2002

Hope so.

What is the Loan to Value?