Mortgage questions
Discussion
Ok here is the situation.
Wife is pregnant and will be leaving work early next year.
We currently are c35% LTV possibly less.
We have an offset mortgage.
What I would like to do is to take out a further c35% mortgage on the property (whilst we still have two incomes) the idea being that the extra mortgage would be with the same provider and it would be an offset. I would put the mortgage funds into the offset.
This would mean that I would only have the set up fees to pay - then every month there would be no interest to pay just the standard monthly fee.
The whole point of this is potentially for a loft conversion/new kitchen/new bathroom/2 storey extension etc. And to ensure that there is zero challenge on any "affordability" measure the bank has.
So firstly is this possible? Does it make sense ?
Wife is pregnant and will be leaving work early next year.
We currently are c35% LTV possibly less.
We have an offset mortgage.
What I would like to do is to take out a further c35% mortgage on the property (whilst we still have two incomes) the idea being that the extra mortgage would be with the same provider and it would be an offset. I would put the mortgage funds into the offset.
This would mean that I would only have the set up fees to pay - then every month there would be no interest to pay just the standard monthly fee.
The whole point of this is potentially for a loft conversion/new kitchen/new bathroom/2 storey extension etc. And to ensure that there is zero challenge on any "affordability" measure the bank has.
So firstly is this possible? Does it make sense ?
Presumably wife will be on maternity leave then, which cannot affect a lender's decision, as she still employed on her contracted wage.
You obviously need to assess whether it is actually affordable, but don't worry about the lender's calcs being effected unless she actually resigns, which would be a bit daft before her maternity leave is up.
You obviously need to assess whether it is actually affordable, but don't worry about the lender's calcs being effected unless she actually resigns, which would be a bit daft before her maternity leave is up.
scotal said:
The affordabilty question is key, can you afford the mortgage on one salary?
It's very affordable. What I'm trying to do is just totally sidestep the question with the bank. The other thing is we are seriously considering solar heating so a chunk of cashoutflow which I'd rather not use savings along with all those other projects.
pacoryan said:
Presumably wife will be on maternity leave then, which cannot affect a lender's decision, as she still employed on her contracted wage.
It can and does affect the lender's decision. The wife's payslips will show a lower amount, which the lender will treat as her income until the point she has returned to work, and her payslips reflect this. ETA I have just htought of one lender who will take full income during a maternity period, provided they have a letter from the applicant stating that they will return to work.....
Edited by scotal on Friday 10th June 15:25
Welshbeef said:
It's very affordable. What I'm trying to do is just totally sidestep the question with the bank.
The other thing is we are seriously considering solar heating so a chunk of cashoutflow which I'd rather not use savings along with all those other projects.
Home improvements.... all things being equal, they'll lend on that.The other thing is we are seriously considering solar heating so a chunk of cashoutflow which I'd rather not use savings along with all those other projects.
How much info they need will be down to the individual lender.
scotal said:
Home improvements.... all things being equal, they'll lend on that.
How much info they need will be down to the individual lender.
Woolwich. How much info they need will be down to the individual lender.
A new family bathroom two story extension making it a 5double bed house, loft extension for the master bedroom plus study and along with the new extension big new kitchen.
Thing is it might be years before any of this happens plus would they even lend for those ideas without any planning permission? Note loft conv and new bathroom would not requrire any planning permission.
Oh forgot to add a nice new drive for four off road cars - nit cheap but really is desirable for us.
whether its possible or not depends on your mortgage provider, you need to speak to them.
They will not know that your wife is pregnant, and if it all falls within their lending criteria, you should be OK
it makes sense, because while you are offsetting, you will not be paying interest on the mortgage, just the capital back, and it gives you the flexibility to take it out without having to explain anything to the lender
They will not know that your wife is pregnant, and if it all falls within their lending criteria, you should be OK
it makes sense, because while you are offsetting, you will not be paying interest on the mortgage, just the capital back, and it gives you the flexibility to take it out without having to explain anything to the lender
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