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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
How do I cash in my Lifetime ISA?
I have been saving for a deposit on my first home with a Lifetime ISA and am hoping I can cash it shortly. My partner and I are currently looking for properties so I don’t think it will be long before we find somewhere suitable.
However, I am a bit confused about how the Lifetime ISA contribution will work logistically. Will I need to cash it in myself then transfer through the solicitor or is there a more official route?
Are there any charges for doing this? Thanks for your help
Answer
No one’s asked me about this before, so I’ve done some reading. As far as I can tell, some criteria need to be met to cash in the ISA without penalty. This includes that:
– You have had the ISA for at least 12 months
– The property must be in the UK
– The property must have a price of £450,000 or less
– The property must be the only home you will own
– The property must be where you intend to live
– You purchase the property with a mortgage
I can’t find anything which exactly states how to withdraw the funds, so that might be a question for your solicitor. I hope this helps, and good luck with your house hunting!
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Question
I am on long term furlough – can I remortgage?
I have been on furlough since the beginning of the pandemic and it looks like I will be in this situation now until the end of September.
It’s looking increasingly like my employer is going to make me redundant at the end of September and therefore I am looking for another job. There’s not much about in my industry and therefore I am probably going to have to consider moving to a lower paid job in another sector.
In the middle of all this, I am also due to remortgage in May! I don’t know whether I should start looking at a remortgage now as with my furlough pay of 80% of my salary I will be earning more than I would if I get a new job.
However, I am also worried the broker/lender will reject my application because of my circumstances.
Will I be eligible for a new remortgage? Or should I stick with my lender’s reversion rate until I am more settled? Thanks for any advice.
Answer
First of all, I’m so sorry that you’re going through such a difficult and uncertain time. Some lenders will consider remortgage applications while you’re on furlough, but they will ask further questions around returning to work.
However, you may find that your existing lender offers what’s called a ‘product transfer’, which is often quite competitive (as they want you to stay with them!).
The main benefit of product transfers is that the lender is unlikely to re-underwrite you, which means your current situation will not be relevant. Hopefully, knowing there is an option for you will give you some reassurance during this challenging time.
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Question
Shared ownership – whose income is taken into account?
I was just reading one of the articles on your website about shared ownership and had a quick question I was hoping you could answer for me.
I was basically a little confused regarding the eligibility criteria. My question is – when it says household income has to be below £90,000 in London, does that mean the household income of those who would be looking to move into the new property on the market, or the household income of those living in the current property?
I say this because, currently, I am living with my parents in a house, where the household income is above £90,000. However, it is only me who is looking to move out and hence secure the property alone, totally independent of them.
So in this sense, the household income is different for the two properties. Surely it should just concern my salary, given it’ll be just me who will be forming the household in the new property? Many thanks for any help you can offer.
Answer
You are not the only one who’s been bewildered by the information that’s out there, don’t worry! To clarify, it is the income of the people who will live in the shared ownership property that counts.
In your case, that will not include your parents’ income. I hope this helps, and if you have any other questions, a good mortgage broker will be able to help you out!
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Question
A question about remortgaging
Sorry to sound a bit clueless – but I am remortgaging for the first time later this year having come to the end of my two-year deal! I literally don’t know where to start. Do I need to get a valuation from the estate agent again?
If my house price has gone up (which I think it has) will that figure be included as part of my equity share?
Also should I go back to my current lender and ask them for a ‘quote’ before I start shopping around or is there an easier way to do all this?
Thanks and sorry for sounding a bit amateur – I am the first one of my friends to buy a home so this is all new to me!
Answer
Please don’t apologise! The best way to get an idea of your properties’ current value is to look at Rightmove or Zoopla or speak to an estate agent. If the value has gone up, you will have more equity than you started with, which should help you get a better deal (as your loan-to-value will be smaller).
Regarding where to look for the actual mortgage, you need to do both the options you’ve mentioned. Speak to your lender to find out what they can offer, and then speak to a mortgage broker to check there’s nothing more competitive available to you.
Another general word of advice about remortgaging – try not to leave it any later than three months before your existing deal is due to end; otherwise, you may run out of time. Like car insurance, you can fix a new mortgage to start right from when your existing one expires ahead of time. Once you’ve done this once, you’ll be a seasoned pro for the next one!
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