Another remortgage question(S)

MarkyMarkD

UK007 Spell check wouldn't help - they are both words; just the wrong one in the circumstances!

Rosiesworld The difference now is that he's self-employed, not an employee. He can't get his employer to certify his income because he doesn't have an employer.

There's no such thing as "little white lies to get a mortgage"; lying to your lender is mortgage fraud and a serious criminal offence.

Rosiesworld

OK to flick things on its head

We bought our house 2 years ago for £125k and its now worth £175k needed work doing

Say we could prove income AND our lender would switch mortgages allowing us to go to 95% LTV that would free up £45k which we then put into a savings account gaining interest we can afford to pay the differance in shortfall from the savings to mortgage increase.(stoozing i believe) that way if the recession hits or the house price crash does actually happen we have got a fall back solution

If house prices drop 40% we have a large deposit(45%) to get a BTL or if the stuff hits the fan we have enough in savings to cover us for a couple of years.

My head hurts now

UK007BullDog

I think you need to read more posts. If you cannot understand what you want to do you will fall flat on your face.

Like we said before you will highly likely not be able to borrow due to income. A cursory glance on your husbands income/account is not what an underwriter will do once an application has been put through.

Rosiesworld

I understand where you are coming from.

Its just if we could I mean if we didnt claim the mileage that would show good on his books etc.

But back to borrowing the money ignoring the possibility that this may completley fall flat on its face.

If we could raise the £45k would it be safe to put into a savings account and pay the shortfall that way if it all went Boobs up we could still pay the £45k back into our mortgage that way minimising the risk

Or am I completly missing something here(barring the proving income)

UK007BullDog

If you can find a savings account that pays out more than the interest on your mortgage rate minus the tax you pay on the interest, then please let me and others know as I dont know of one at this time.

If your property value falls dramatically then so will all the others around you too. So it does not matter as such does it?!

Rosiesworld

UK007BullDog wrote: »

If you can find a savings account that pays out more than the interest on your mortgage rate minus the tax you pay on the interest, then please let me and others know as I dont know of one at this time.

If your property value falls dramatically then so will all the others around you too. So it does not matter as such does it?!

Thats why I mentiond the shortfall as opposed to profit

If house prices fall then we would have trouble borrowing to buy a new property but if we had the money already that wouldnt be a problem a 45% deposit would be much better than a 10% deposit

UK007BullDog

I can see what you are saying. However:

If your property is in negative equity and interest rise high like say 8.5% and you now need to remortgage you will be stuck on the lenders SVR which could be as high as 10% or more. If you ae unlucky the lender will insist on a survey a will revalue your property downwards. They might not give you a new deal. You will be in the situation like a lot of NR customers are now.

Also if you tried to seel you still owed the lender money. You might not be able to as you cannot raise enough money to pay off the mortgage.

Your thinking works when prices go up, but when falling its a recipe of disaster.

Your deposit of 10% on a house in the future might be better value then than it is now.

Personally I would not risk it. If you find a lender or broker helping you then they are just out for the commissions.

Rosiesworld

See I understand that.

But If i tied myself in for 5-10 yrs it would work.

Not that i fancy tie`ing myself in but looking at interest rates
http://www.houseweb.co.uk/house/market/irfig.html
They were dreadfull at the begining of the 90`s

Do we really think it could be that bad again

Luckily i have a job that wasnt really affected last time

mpg

Dragging this up from the dead but:

After reading some other posts I have a new spin.
Would a remortgage or new deal with more money from existing lender
be a safe way to ride out a possible recession
If i tie in for 5 years with say an increase of £45k and put this in a savings account(whats a good AER) If the repayments make my monthly outgoings another £250-£300 extra which in itself i can afford but with the interest payments my share would be much smaller.

If all hell broke loose recession etc I could afford to pay my mortgage with the savings for approx 5 years.

MarkyMarkD

Arguably a lot cheaper than buying payment protection insurance. But I'm not sure it's really the best way to go.