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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
Tree is hindering our mortgage application
We are in the process of buying a property but we are having trouble securing a mortgage because there is a tree, with a Tree Protection Order (TPO), which is very close to the house itself.
Do you know if there are any lenders who might consider lending on a property in this situation or if there’s a way we might be able to get around the problem? There are currently no signs of subsidence but so far two lenders (high street banks) have refused on this basis.
We have a high amount of equity, stable jobs and we can’t foresee any other problems. It’s just the TPO.
Answer
Lenders usually send out a contracted surveyor out to your property, who will then report any concerns back to the lenders, such as large trees close to the building.
My advice here would be to get a tree report completed first, to evidence how much of an issue it poses. Your broker can then use this as supporting document when talking to lenders to find out whether they see it as an issue, before submitting any applications.
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Question
Remortgage difficulties because of valuations
We are currently trying to remortgage our home. We have lived here for five years and have come to the end of our five-year deal. We are having building work so hoping to remortgage as soon as possible to help pay for some of the work.
But there’s a problem. We bought our house when the market was going up and our neighbours, who moved in two years ago and are in a similar property, purchased when the market was lower. This means our valuation has been based on their purchase and, as such, I have had a much lower valuation which has impacted our remortgage.
What can we do? We obviously don’t want to sit on our lenders’ SVR and get an unsecured loan for the building work as this very expensive. Are there any other options? Are there any short-term mortgages we could use which would allow us to get an advance for the work?
Answer
This is a tough situation for any home-owner and unfortunately, somewhat out of your control. The main question here is: will the building works you’re currently doing significantly increase the value of your property?
If so, it might be possible to take out a second charge or short term bridging loan in order to complete the work.
Once the works are complete, you should be able to refinance the whole property against the new higher value. I would recommend speaking to a broker who will be able to advise whether this is an affordable option for you.
If the works you’re currently doing aren’t going to add much value to the property, I’m afraid you may have to sit tight for now. I’d recommend speaking to your broker about what options you can afford and go from there.
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Question
Stamp duty confusion
My daughter is about to purchase a house in London worth £550,000. She is a first-time buyer and is making the purchase with her partner.
Under new stamp duty rules will she be liable for the tax on the proportion of the property which is above £500,000 – ie £50,000? Or will she not benefit from the stamp duty holiday at all?
Answer
You’ll be please to know that your daughter and her partner will only be liable to pay tax on the £50,000 above the £500,000. This means they’ll only be paying 5% on the £50,000, which totals £2,500.
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Question
Self-employed – can I get a mortgage post-Covid?
I am self-employed and was using the government support grant during the lockdown. I am now (fortunately) up and running again.
My husband was on furlough but has also now returned to work. We are both full-time. How will this affect our mortgage? We are both first-time buyers and we have a 10% deposit. Thanks for your help.
Answer
This must have been a challenging time for you – I’m glad to hear you’re both back at work now!
The majority of lenders are looking at cases like yours on an individual basis. The best advice I can give is to be completely transparent with your broker about why you required the support grant so they can relay your situation to potential lenders to see whether it’s going to be an issue.
Be prepared for lots of questions about your incomes (especially as first-time buyers), particularly your projected self-employed income. It may be worth having an accountant prepare your accounts to submit to the lender.
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