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Our property investment expert is Jeni Browne, Sales Director at
Mortgages for Business
www.mortgagesforbusiness.co.uk
Tel: 0345 345 6788
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Question
New partner, new mortgage?
I am moving in with my partner and we are planning to add myself to his mortgage. What do we need to do to get my name on the mortgage and will I need to provide all the necessary paperwork – bank statements, payslips etc? I have not had a mortgage before but don’t have any adverse credit problems and am in full-time employment.
Answer
To get added to the mortgage your partner will have to contact the lender directly. You will then be underwritten just like any other mortgage applicant. If you find you can’t get added to the mortgage for any reason, you and your partner could consider remortgaging with a new lender as joint applicants.
In addition to adding yourself to the mortgage I presume you will want to go onto the title deeds of the property otherwise you’re taking on the debt without actually having any ownership in the property. To get onto the title deeds you and your partner will need to instruct solicitors. Also bear in mind that you may have to pay stamp duty on the consideration being transferred to you – your solicitor will let you know if this is the case.
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Question
Help to Buy
I was really pleased to see the Government is extending the Help to Buy scheme to 2023 as my partner and I have just started saving to get onto the housing ladder, but we think it will take us at least five years to get our deposit together. Can you give us any more tips on what we can do in this time to increase our chances of getting a mortgage, please? I know it’s a long way off, but we want to maximise our chances.
Answer
There are lots of things you can do to improve your chances of getting a mortgage. Here are the main things to consider:
• Register to vote. Lenders use the voters’ roll to run identity checks and not being registered could lower your credit score.
• Keep a clean credit profile. That means pay all your bills on time and don’t take out too much credit. Don’t exceed your overdraft limit – if possible, don’t have an overdraft. Try to clear your credit card balance every month or at the very least make the minimum monthly payments but try not to borrow more than 75% of your credit limit. Check your profile regularly so that you can iron out any discrepancies should they occur.
• Get your paperwork ready. You’ll need proof of identify, address and income.
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Question
Using a broker
I would appreciate some advice, please, on using a broker. I am due to remortgage on my property. When I took out my original mortgage I went directly to a bank and was thinking of going back to my bank for the new deal. But my friend has recommended using a broker. He said he didn’t pay anything – but is this right? I am also worried I will have to do double the amount of form filling – for the broker and then lender. Can you put my mind at rest?
Answer
Some brokers charge a fee to customers and some don’t – it all depends upon their business model. At the end of the day, it’s up to the customer to decide whether and which broker to use. For the most part, independent, whole-of-market brokers will save you time (no double form filling) and they will try to save you money too. They have access to rates that aren’t available to customers directly. Most importantly, a broker can often get you a mortgage even if you thought it would be impossible. Of course, it’s important to check your broker’s credentials. Make sure that they are Financial Conduct Authority (FCA) registered (either Directly Authorised or an Appointed Representative). Also, make sure they are CeMAP qualified.
If you do choose to work with a broker, they are obliged to set out clearly their fees and any other fees or costs involved in taking out a mortgage. And they are obliged to present you with the most suitable options for your requirements.
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Question
Remortgaging more than my house’s value
We are due to give birth to our second child next May and need more space in our house. We can’t afford to move home because the gap between the price bracket we are currently in the one we want to move to is huge! Also, we are worried about Brexit and lack of choice etc. So, we have decided to build a loft extension. Someone told us we could get the money for this by remortgaging, and adding the amount we need for the extension onto the amount we need to repay on the house. Is this possible and, if so, how would be go about doing this? Would the lender need to see builders’ quotes etc?
Answer
You cannot borrow more than the value of your property but if you do have sufficient equity in your home, you have two main options. You could get a further advance which means your current lender lets you borrow more under a new arrangement, usually at a different interest rate, leaving your existing mortgage intact and untouched. This is a popular option if you’re tied into Early Repayment Charges (ERC) and/or on a very competitive rate already. Further advances usually take around four weeks to complete. It is relatively quick because the lender already knows you which means less paperwork.
Alternatively, you could remortgage. Sometimes this option is cheaper, especially if you’re not tied into ERCs. You may be surprised to know that on numerous occasions we’ve been able to raise capital for home improvements and save our customers money on their monthly mortgage payments. Do get in touch if you’d like to find out which route would be best for you.
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