Mortgages

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Gavin
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Mortgages

Post by Gavin »

A friend cannot get one for a cheap house. They have paid rent for a decade or more which has been higher than a mortgage.

I thought about buying it to rent to them with a view to them buying it from me once their credit rating improved but apparently buy to let is a 25% deposit. :(

Up yours lenders!
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duncs500
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Re: Mortgages

Post by duncs500 »

Why is their credit rating so bad? :|
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Gavin
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Re: Mortgages

Post by Gavin »

duncs500 wrote: Thu Jun 10, 2021 5:13 pm Why is their credit rating so bad? :|
always lived in rentals, never had credit. 3 years is the longest they have ever lived anywhere. I get that credit ratings are a thing, but if you can afford rent, you sure as shit can afford a mortgage on the same property
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Rich B
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Re: Mortgages

Post by Rich B »

Gavin wrote: Thu Jun 10, 2021 5:22 pm
duncs500 wrote: Thu Jun 10, 2021 5:13 pm Why is their credit rating so bad? :|
always lived in rentals, never had credit. 3 years is the longest they have ever lived anywhere. I get that credit ratings are a thing, but if you can afford rent, you sure as shit can afford a mortgage on the same property
how much deposit do they have? That's usually a good way to mitigate the lenders risk.
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Swervin_Mervin
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Re: Mortgages

Post by Swervin_Mervin »

We've had a nightmare getting extra borrowing despite decent earnings, a low LTV etc.. In fact we're still waiting after a good couple of months of wrangling! We've had a mortgage for 20yrs now and no missed payments. We've been overpaying 25%/mo for 2-3yrs now as well.

The amount we want would cost less/mo than those overpayments even and yet it's still proving problematic because of me being an owner/director.
Last edited by Swervin_Mervin on Fri Jun 11, 2021 12:28 am, edited 1 time in total.
mr_jon
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Re: Mortgages

Post by mr_jon »

Lots of ways they can build their credit rating and - without any harshness intended - they should have been doing this for the last couple of years if they intended to buy. The missus had a crap credit rating but is in the 970's now with Experian on very basic credit terms like a card and phone.

I'm certainly glad I'll not have to go through that rigmarole ever again.
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Simon
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Re: Mortgages

Post by Simon »

Are they registered to vote?
The artist formerly known as _Who_
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dinny_g
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Re: Mortgages

Post by dinny_g »

Are they applying themselves or using a broker???
JLv3.0 wrote: Thu Jun 21, 2018 4:26 pm I say this rarely Dave, but listen to Dinny because he's right.
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Gavin
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Re: Mortgages

Post by Gavin »

Deposit would be almost nil I think, but I think they were told "if you ha 5% or whatever, still a no". Will suggest using experian or similar though, that's a great shout.
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Rich B
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Re: Mortgages

Post by Rich B »

Gavin wrote: Fri Jun 11, 2021 7:52 am Deposit would be almost nil I think, but I think they were told "if you ha 5% or whatever, still a no". Will suggest using experian or similar though, that's a great shout.
They don't have any deposit? What happens if the market goes down and/or they lose their job? It then becomes the banks risk.
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dinny_g
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Re: Mortgages

Post by dinny_g »

Or Interest Rates go up ???

In rental accommodation, they can always move if the landlord raised the prices the rental but they can't do that with a mortgage.

I feel for your friends Gav but I think you've answered your own question.

I'd still get a Broker involved as they're the experts in finding products. It might be sub prime level with crazy interest rates but they'll find a deal if they really want to buy.
JLv3.0 wrote: Thu Jun 21, 2018 4:26 pm I say this rarely Dave, but listen to Dinny because he's right.
V8Granite
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Re: Mortgages

Post by V8Granite »

I’m amazed they even let them in to discuss it if they have no credit or deposit.

They are a very high risk for the bank.

Dave!
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GG.
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Re: Mortgages

Post by GG. »

Well this was a pointless thread! Couple with no deposit can't get a mortgage non-shocker.

Banks haven't lent at 100% LTV for 13 years. 95% mortgages are available only in limited circumstances and most banks would have a cap on how much they will lend at that level (same for salary multiples on an affordability basis).
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duncs500
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Re: Mortgages

Post by duncs500 »

V8Granite wrote: Fri Jun 11, 2021 9:28 am I’m amazed they even let them in to discuss it if they have no credit or deposit.

They are a very high risk for the bank.

Dave!
Sadly this. They need to make a proper plan involving saving for a deposit and building up their credit rating. Being able to afford the rent each month is not enough.
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Jimmy Choo
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Re: Mortgages

Post by Jimmy Choo »

GG. wrote: Fri Jun 11, 2021 9:43 am Well this was a pointless thread! Couple with no deposit can't get a mortgage non-shocker.

Banks haven't lent at 100% LTV for 13 years. 95% mortgages are available only in limited circumstances and most banks would have a cap on how much they will lend at that level (same for salary multiples on an affordability basis).
I struggled to get a 90% mortgage last year. I managed it but I'm paying slightly more than I wanted as I could only get 3.09% (fixed for a length of time that I can't remember)
Banal Vapid Platitudes
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GG.
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Re: Mortgages

Post by GG. »

Even that's pretty good! My first mortgage was not that long ago (8 years?), i.e. when rates where already low... and that was 4.19% at 90% LTV
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Holley
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Re: Mortgages

Post by Holley »

Yep 95% mortgages is the lowest you can have, but clients need to be credit healthy.

@Swervin_Mervin Have you tried Coventry? Some Building Societies take into account your net profit as well as salaries/dividends for limited company owners.
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Gavin
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Re: Mortgages

Post by Gavin »

GG. wrote: Fri Jun 11, 2021 9:43 am Well this was a pointless thread! Couple with no deposit can't get a mortgage non-shocker.

Banks haven't lent at 100% LTV for 13 years. 95% mortgages are available only in limited circumstances and most banks would have a cap on how much they will lend at that level (same for salary multiples on an affordability basis).
No, this is me moaning in a moaning thread as I wanted to moan. I know why they cannot get one, I worked in a bank and know they are a high risk, I just think it is crap.

I wasn't looking for solutions or dickish answers, but true to form...
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Swervin_Mervin
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Re: Mortgages

Post by Swervin_Mervin »

Holley wrote: Fri Jun 11, 2021 9:59 am Yep 95% mortgages is the lowest you can have, but clients need to be credit healthy.

@Swervin_Mervin Have you tried Coventry? Some Building Societies take into account your net profit as well as salaries/dividends for limited company owners.
This is just for extra borrowing hence we're dealing with our current BS. They supposedly take into account net profit, but the fact our 2nd year profits were down on the 1st year (still very, very decent though) they took as an excuse to say they couldn't take my earnings into account at all. I've had to go to great lengths to explain the reasons why (mostly because we paid 1st year pensions and 3mo of salary out in our 2nd year). I'm still not convinced they're taking my earnings into account as they seemed more interested in additional elements of the wife's remuneration package :lol:
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GG.
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Re: Mortgages

Post by GG. »

Gavin wrote: Fri Jun 11, 2021 10:21 am
GG. wrote: Fri Jun 11, 2021 9:43 am Well this was a pointless thread! Couple with no deposit can't get a mortgage non-shocker.

Banks haven't lent at 100% LTV for 13 years. 95% mortgages are available only in limited circumstances and most banks would have a cap on how much they will lend at that level (same for salary multiples on an affordability basis).
No, this is me moaning in a moaning thread as I wanted to moan. I know why they cannot get one, I worked in a bank and know they are a high risk, I just think it is crap.

I wasn't looking for solutions or dickish answers, but true to form...
Your first post omitted the most salient piece of information wasting peoples time by getting them to suggest answers which won't work. Mirror, reflection, my friend.
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