Need to reMortgage with low income
Discussion
Anyone able to help on this one? It would be appreciated!
My mortgage is interest only but I put in lump sums to capital every now and then (this is allowed free of charge). However, my mortgage currently stands at nearly 14K and is due to be paid off next August. House value around 75K, so LTV less than 20%.
I applied to my current lender Santander for an extension to 2024, and also making it repayment, but they've turned me down. I understand that this is because my annual income (I am self employed) is only about 7K. I've sent them details of income and expenditure, explaining that I don't go on holiday and I grow most of my own fruit and vege as I have an allotment, and I don't eat meat; so expenditure is lower than would be expected.
Anyone able to suggest who would give me a mortgage in this position PLEASE!!! It seems ridiculous the idea of possible repossession when I already have a mortgage and owe so little.
Thanks so much! Getting rather stressed! I only heard their decision today. (They got my paperwork weeks ago but were inefficient!)
My mortgage is interest only but I put in lump sums to capital every now and then (this is allowed free of charge). However, my mortgage currently stands at nearly 14K and is due to be paid off next August. House value around 75K, so LTV less than 20%.
I applied to my current lender Santander for an extension to 2024, and also making it repayment, but they've turned me down. I understand that this is because my annual income (I am self employed) is only about 7K. I've sent them details of income and expenditure, explaining that I don't go on holiday and I grow most of my own fruit and vege as I have an allotment, and I don't eat meat; so expenditure is lower than would be expected.
Anyone able to suggest who would give me a mortgage in this position PLEASE!!! It seems ridiculous the idea of possible repossession when I already have a mortgage and owe so little.
Thanks so much! Getting rather stressed! I only heard their decision today. (They got my paperwork weeks ago but were inefficient!)
Sarnie is your man.
But, as it's only £14k (and will be less by the time your current deal is up) surely you could just arrange a bank loan for the balance at remortgage time and pay it off in a oner with that.
I am on (very) average wage and have recently been offered a £24k pre-approved loan from my bank.
It took ALL of my will power to ignore it and not buy a nice Bentley Turbo! Lol.
But, as it's only £14k (and will be less by the time your current deal is up) surely you could just arrange a bank loan for the balance at remortgage time and pay it off in a oner with that.
I am on (very) average wage and have recently been offered a £24k pre-approved loan from my bank.
It took ALL of my will power to ignore it and not buy a nice Bentley Turbo! Lol.
Thanks Crafty and TLJ! 
OP, the problem that you will come up against is the new MMR affordability regulations incorporate a level of outgoings for food and bills etc, derived from the Office of National Statistics. So the lender will see one applicant and attribute say £300 a month to food bills for example. So, if you own figures are lower than the national average then if you can evidence it then it should be ok with some lenders.
Another issue is that a lot of lenders have a minimum lend of £25k but you could get around that by overpaying the surplus straight after completion if you pick your product carefully.
Fell free to drop me a mail if you need some help with this?
OP, the problem that you will come up against is the new MMR affordability regulations incorporate a level of outgoings for food and bills etc, derived from the Office of National Statistics. So the lender will see one applicant and attribute say £300 a month to food bills for example. So, if you own figures are lower than the national average then if you can evidence it then it should be ok with some lenders.
Another issue is that a lot of lenders have a minimum lend of £25k but you could get around that by overpaying the surplus straight after completion if you pick your product carefully.
Fell free to drop me a mail if you need some help with this?
The irritating thing is that I COULD afford it ... I have been paying into my capital lump sums the last few years, but the main reason I haven't paid off was that I had some years of unemployment or very low income before I started the self-employment which I currently have; and even though my income is still low by most standards, I grow a large proportion of my own food. Santander KNOW that I've managed to pay into the capital even though I had a low income! Before they got my income details, they told me how much I'd have to pay monthly and it seemed quite manageable. Indeed, I intend to pay that amount into my capital by August but unfortunately that is when my time runs out, and I can't pay the whole 14K in that time!
catanddog said:
The irritating thing is that I COULD afford it ... I have been paying into my capital lump sums the last few years, but the main reason I haven't paid off was that I had some years of unemployment or very low income before I started the self-employment which I currently have; and even though my income is still low by most standards, I grow a large proportion of my own food. Santander KNOW that I've managed to pay into the capital even though I had a low income! Before they got my income details, they told me how much I'd have to pay monthly and it seemed quite manageable. Indeed, I intend to pay that amount into my capital by August but unfortunately that is when my time runs out, and I can't pay the whole 14K in that time!
Could any friends or family who trust you enough lend you some cash to help reduce the £14k. All you'll have to do in the meantime is save, save, save (which it sounds like you do anyway) and get it down as much as possible before the term ends. Then you might be able to secure a £5/6k loan and help from other might get you somewhere near.
Sarnie said:
It would be fairly difficult to secure a £14k loan with a £7k pa income......
Fair pointAlthough some of the peer2peer lending sites are starting to offer secured loans, which might be a good option, quick scout round suggest rates of 7.5%.
Op - If I've read it right at least you have 10 months to sort this out.
Fair play to the OP for getting by on so little each year and I imagine still having a decent life it just goes to show it can still be done.
As for the predicament I'd go with the personal loan option and find a guarantor to satisfy lending requirements. Banks lend by computers now gone are the days of bank managers looking you in the eye and taking a very slight risk. Although having said that if the OP wanted a 50" plasma TV she could get one tomorrow on a repayment plan!
As for the predicament I'd go with the personal loan option and find a guarantor to satisfy lending requirements. Banks lend by computers now gone are the days of bank managers looking you in the eye and taking a very slight risk. Although having said that if the OP wanted a 50" plasma TV she could get one tomorrow on a repayment plan!
Thanks ppl! Yes, 10 months to sort it. Santander oh so kindly said I could apply again in six months! but there is no point in waiting.
Unfortunately I don't have the right friends to lend me that sort of money! Thanks anyway.
Might have to investigate a loan, but I think I'll try the Citizens' Advice Bureau. I intend to take evidence of income AND evidence of the repayments I've made to the capital over the last few years, which show that my case is good.
According to a web site I looked at, lenders are supposed to do everything reasonably possible to avoid having to repossess ... such as extending the term! Which is exactly what I want! I do think Santander are pathetic! Okay, new rules might say they couldn't start someone in my position on a mortgage in case they have to repossess, but I've already got the mortgage!
Unfortunately I don't have the right friends to lend me that sort of money! Thanks anyway.
Might have to investigate a loan, but I think I'll try the Citizens' Advice Bureau. I intend to take evidence of income AND evidence of the repayments I've made to the capital over the last few years, which show that my case is good.
According to a web site I looked at, lenders are supposed to do everything reasonably possible to avoid having to repossess ... such as extending the term! Which is exactly what I want! I do think Santander are pathetic! Okay, new rules might say they couldn't start someone in my position on a mortgage in case they have to repossess, but I've already got the mortgage!
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