[col type=”one-third”]
Our property investment expert is Jeni Browne, Sales Director at
Mortgages for Business
www.mortgagesforbusiness.co.uk/
Tel: 0345 345 6788
[/col]
[col type=”two-third last”]
Question
Interest-only: Can I stay in my flat at the end of the term?
I have a leasehold flat with a £190,000 mortgage on it. It’s an interest-only mortgage and the term ended in May 2018. The bank has extended the term to give me time to sell but I do not want to sell and have never been in arrears.
What are the chances of staying in the flat if I continue to pay interest regularly for the next 10 years?
Answer
Because you are now in breach of your mortgage, you really need to try and move the mortgage to a new lender (ie a remortgage). The feasibility of this will really hinge on your circumstances, in particular, your age and income.
The best option for you would be to speak to a whole of market mortgage broker, who will best placed to tell you whether this is possible.
[hr style=”single”]
Question
How to get help from parents with small income
Lots of my friends have got onto the property ladder with help from their parents who have basically given them money to put down for a deposit. My partner and I are saving for our first home but we don’t have the benefit of the Bank of Mum and Dad. Are there any ways our parents could help us without sacrificing any of their own much-needed cash?
Answer
It’s a huge challenge for first-time buyers to pull together a deposit, however, there are two options which jump to mind here.
Firstly, have you considered the Government Help to Buy Scheme – you would still need to find a 5% deposit to access this scheme, but this may help you out?
Alternately, your parents may be able to raise funds against their home either by way of a further advance from their current lender, or by doing a Remortgage. A mortgage broker will be able to run through both options for you.
[hr style=”single”]
Question
Mortgage rejection – can I bounce back?
Unfortunately, I have recently been rejected for a mortgage. I am very disappointed as I have been saving for some time but the lender in question told me I didn’t have a reliable enough income. This is because I am self-employed and therefore my earnings are erratic and I don’t have proof of regular earnings.
However, I have been paying rent now for ten years, have never missed a payment and my rent is about £250 a month more than my mortgage would be! It’s really frustrating.
I want to try and apply again but wondered if I should go about it a different way? Last time I went straight to a well-known high street bank. Also will my previous rejection impact future applications? For your info I earned £46,000 in the last tax year. I have a 5% deposit to put down on a flat worth £270,000.
Answer
I am sorry to hear that – it’s always so disheartening when you get knocked back by a lender. The good news is that this decline will not preclude you from getting a mortgage elsewhere.
For self-employed borrowers, lenders tend to look at the most recent SA302s and work on your taxable income. Some will look at the most recent years’ figures, others will look at the last 2 years’ figures.
It’s quite normal for a self-employed person to have non-regular income so I am surprised you were declined on this basis… it would be a good investment of your time to speak to a mortgage broker who will be able to look at your income documents and point you in the right direction. Good luck.
[hr style=”single”]
Question
Helping my parents with their mortgage
My parents have suffered with terrible financial difficulties over the last few years because of redundancy and other problems. They have an interest-only mortgage which they have not refinanced for years but because they have had credit problems they won’t be able to remortgage anyway.
I am in the very fortunate position of being a homeowner and a good earner and I would like to use some of my money to either help my parents remortgage. Is this a possibility and would my excellent credit score and a healthy injection of cash be enough to secure them a better deal?
Answer
I am sorry to hear that your parents have had a tough time. Whilst the mortgage remains in their names, their credit history will remain a bone of contention with lenders, however, it may be that your standing as guarantor will strengthen their position and the injection of cash will probably also help.
The best course of action is to obtain a copy of their credit files and then speak to a mortgage broker who will be able to advise on the best course of action. I hope this helps and I wish your family the best.
[hr style=”single”]
Question
Shared ownership: Do I need a special mortgage?
I am looking at purchasing a shared ownership property in an affordable housing block close to my place of work. I would like to know what kind of mortgage I need to take out in order to get finance for the purchase.
I have saved around £8,000 and propose to purchase 25% of a property worth £250,000 (with plans to ‘staircase’ up to a greater percentage further down the line).
Am I eligible for any mortgage or do I need to find a product for shared ownership homes? Also, is it better to stick to a short term mortgage – two-years – in case I want to refinance and staircase sooner rather than later?
Answer
Shared ownership is available from lots of lenders but not all, so you do need to research who to approach. The good news is that lenders do not charge more for lending on a shared ownership property so you will not be penalised.
The option of a two-year deal (ie two-year fixed rate) makes sense if you want to staircase, but just know that the mortgage term will be much longer – 25 to 30 years most likely. When you speak to the lender, be sure to make your plans to staircase known so that they can advise you how best to structure the mortgage.
[hr style=”single”]
[/col]
