NR mortgage finshing and general questions

JAM1376

Hi all

First time on this board so here goes. I have just found out that my NR mortgage is due to finish on the 1st Nov (@5.2%) and will go onto their standard rate (@9.4%).

We bought the house for 120k three yrs ago and its now been valued at approx £135k. We have 105k left on the mortage.

This is where it all goes wrong. I have since changed jobs and am now on 20K. Will any providers give me a 105k mortgage? I would love to borrow an extra 15k to pay off debt but I think this is unrealistic.

Lastly, my OH (we are married) would like to be on the mortgage and have his wages taken into account (25k) but his ex wife allowed his old family home to get repossessed so I don't think he will get a mortgage now (have to wait 6 yrs don't we?).

I know I have a few months but this is worrying me a lot. Any advice from anybody would be much appreciated.....re new mortgage on my own wages or if banks will penalise my OH for his repossession?

Sorry its long!! Thank you!!

lisyloo

I believe the NR standard variable rate is 7.49%, so I suggest you check that out first (in can you are on some sort of different product).

I would suggest that you are unlikely to get a mortgage of 5 times your salary in the current credit crunch but your best bet would be to ask a mortgage broker.

I know I have a few months

We re-mortgages take 3 months because there is legal work and surveys involved and you won't be the only person waiting so it take time, so you are right to be getting this sorted now.

You may have to prepare for being on the 7.49% SVR.

You have a 45K income so you ought to be able to afford a £105K mortgage really even at somewhat higher rates.

If you can't afford it I suggest you give a few more details about outgoings and then perhaps people can help.

JAM1376

Thanks for the info. We could easily get a mortgage if I could take my OH into account (like you say, 45k) but with a repossession on his credit check, will they give him/us a mortgage together?

I spoke with NR two days ago and I'm sure they said it was 9.4%. Perhaps I am mistaken! Won't be too bad if it's only 7.something as the RBS one I was looking at was fixed at 7.1% (if they would let me/us have it!)

Thanks your your advice. Anyone else know about the reposession issue?

lisyloo

but with a repossession on his credit check, will they give him/us a mortgage together?

]

I'm not a broker but I think repossession looks very bad.
I'm not being nosey but some more information may help.
Was he on the mortgage at the time?
Who was supposed to be making the payments?
Was it a case that he could not come off the mortgage as the ex didn't earn enough to take the mortgage on?
I can see a few glimmers of hope but it does depend on what happened.

When I referred to £45K, I meant that in reality this is what you have and on paper it looks very affordable (although we don't know if you have other costs e.g. kids with ex or child care).

I spoke with NR two days ago and I'm sure they said it was 9.4%.

The very first thing you should do is check this.
Are you on any special sub-prime product? or is it just an ordinary mortgage?
It might alleviate a lot of worry if you simply mis-heard.

JAM1376

If you don't know the facts, you can't help! Its not being nosey!!!

When my OH left his ex and came to live with me, they were selling the family home. He signed the papers with the estate agent and, as he had agreed to leave any equity with his ex and two children, he assumed everything had gone through and the house had been sold (they had a buyer and everything).

It was only a few months ago that, to get some money from Quidco (!!!) we checked his credit report and found the repossession (it actually says he still owes 100k+ but this has not been updated since 2005).

When he asked his ex, she says the people they had the mortgage with would not allow them to sell as they owed ones months rent (which I still don't beleive but there you go). Because of this, the sale fell through, the ex couldn't afford the house and so she just 'did a runner' and now rents from a friend. We knew nothing of this as we would have paid whatever was needed (the months rent at the time) for her to sell the house and have the 15k equity for the kids.

I asked for advice on here when we found out and was advised not to question it (even though it says he still owes when the house was sold in 2005-we've looked on Upmystreet) as they could start chasing the debt again!!

In some ways, I wish I hadn't checked the report and so I wouldn't know and wouldn't be worrying!!!!!!!!!!!!!

Does this make sense? We didn't know whether to add a note (thing) to the credit report (but that would be aknowledging it) so we have just left it, hoping to sit it out for three more years.

Any new advice on this would also be appreciated!!

I'll call NR again tonight and find out what the rate will be after the 1st Nov - like you say, it might not be as bad as I thought!! Sorry for being long again!

lisyloo

he says the people they had the mortgage with would not allow them to sell as they owed ones months rent (which I still don't beleive but there you go)

A mortgage company will not release a "charge" from a property until everything is paid.
Unless the "charge" on the property is released the new people will not be able to buy it as they won't be able to get a mortgage whilst the old charge is left on.
It's a bit like doing an HPI check on a car.
You would not buy a car if there was an existing loan on it.

We knew nothing of this

This may come across as a little harsh, but a mortgage lender would say that your OH agreed to a loan but did not ensure that it was paid or remove himself from the loan.
So what your OH should have done is made sure he came off the mortgage (which would have happened at the point of sale) OR until he came off the mortgage he is responsible (jointly) and liable for the payments.
He didn't actively do anything wrong , but he walked away from a contract that he had for a loan.
I'm afraid that just walking away and leaving someone else to it when you are jointly liable is not acceptable.
I'm not being nasty, just saying how I believe a lender is likely to see it.

even though it says he still owes when the house was sold in 2005

Do you know how much it sold for and whether there was equity?
It possible that the lender added extra costs on e.g. building insurance whilst up for sale, estate agents fees etc.
It's possible there is still a debt although I have to say that £100K sounds wrong.

hoping to sit it out for three more years.

Really sorry, but I think I have bad news.
I'm pretty sure it's 12 years for mortgages and not six.
http://en.wikipedia.org/wiki/Limitation_Act_1980

Bargain_Rzl

The situation sounds extremely complicated, but one simple thing to point out is that SVR stands for Standard Variable Rate, and therefore there's no way of knowing what that rate will be in November just because it is 9.4% (or 7.49%) now.

lisyloo

Yep, I hate being the bearer of bad news again, but I think a rate rise is likely as the bank of England need to tackle inflation.
Clearly I don't know what they will do but you can gain an insight into their thinking but reading their meeting minutes and a rate rise was discussed (and voted for by some members) at the last meeting.

FraudBuster

Land and property debt will haunt you for twelve years.

JAM1376

We realsied when we first found out that it was a self inflicted problem and he should have done things differently! He's civil with his ex so we thought she would have said something if there was a problem, especially if she stood to lose 12k!! If she had just asked him for the 1k ish that they owed, this could all have been avoided - pride I suppose but there you go - who knows what you'd do in any situation (although it does make me angry as heck with her!!).

I'm still confused that, if the house was being sold and the mortgage paid off then this would also pay off the one month outstanding, surely? Anyway, if thats the way they do it, its no good crying afterwards!!

I can't remember the figures now but when we looked at it a few months ago, there would have definately been about 10k equity. I also wondered where that had gone and if it had ALL been swallowed up in 'costs' of repo.

12 years? What swear words can I use on here?

Bargin, I am worried about a rate rise, thats why I want a new fixed/capped mortgage.

New question (sorry), I am due a 4k payrise in October (in my contract): 1) will brokers take this into account or 2) if I wait til then to remortgage, will I get the 105k I need on a 24k wage?

It just gets more difficult to sort out!!!!!!!!!!!!!!!!!!!!!!!!!!!! Its good to have other peoples points of view though, thanks! :beer:

lisyloo

I'm still confused that, if the house was being sold and the mortgage paid off then this would also pay off the one month outstanding, surely?

It sounds as though the lender was refusing to agree for the charge to be removed (and hence the house to be sold) whilst there was a payment outstanding.
This could fairly easily have been resolved but it doesn't sound like anyone was communicating very well with the lender about it.
The lender might have just been following procedure (computer says no) and no-one contacted them to sort it out.

I can't remember the figures now but when we looked at it a few months ago, there would have definately been about 10k equity. I also wondered where that had gone and if it had ALL been swallowed up in 'costs' of repo.

It's quite different from a normal house sale.
When you do a normal house sale, you talk to agents, clean the house yourself at no cost.
With a lender they would have to get all this done professionally e.g. instructing agents, cleaning, decorating etc.
Imagine they are charging £50 per hour for being on the phone to the estatet agent whereas you would do it for free.
They possibly put the house up at auction to get a quick sale also.

I would suggest you go on a site like www.nethouseprices.com to see if you can find the actual sale price.

Even with professional cleaning and buildings insurance it's difficult to see why it would be £100K, but you should be able to find the price as all sales are now on line.

Are you sure the credit report says he OWES £100K or are they just recording that he defaulted on the loan.
If you could put up what it says on the report it might help.

will brokers take this into account

Once you have it - yes.
A promise of a payrise counts for zip.
They could change their mind or you might lose your job or leave so promises cannot be taken into account (unless your employer will commit to it in writing perhaps).

if I wait til then to remortgage, will I get the 105k I need on a 24k wage?

It's looking a lot more hopeful, but you'll be on SVR for a few months as re-mortages can take up to 3 months.