Couple of mortgage questions
Discussion
Hi guys,
I've owned my current (and first) flat for the past 3.5 years, and am thinking of upsizing later this year with a deposit of around 25-30%. However, I'm moving jobs in a few weeks (same sh*t, different company) - how much of a restriction does this put on mortgages these days? Do most lenders require a minimum time in your current company, or ramp up the rate if you've not been there long?
Also, my current mortgage is a lifetime tracker at base + 0.75%, no limit on over payments. Until now I've been over paying whenever possible, which has got the LTV down to around 50%. However, given the good rate, am I better off not over paying, keeping the maximum loan at this rate, such that when I upsize, I keep this mortgage and get a new mortgage just for the increased amount?
Cheers,
Jim
I've owned my current (and first) flat for the past 3.5 years, and am thinking of upsizing later this year with a deposit of around 25-30%. However, I'm moving jobs in a few weeks (same sh*t, different company) - how much of a restriction does this put on mortgages these days? Do most lenders require a minimum time in your current company, or ramp up the rate if you've not been there long?
Also, my current mortgage is a lifetime tracker at base + 0.75%, no limit on over payments. Until now I've been over paying whenever possible, which has got the LTV down to around 50%. However, given the good rate, am I better off not over paying, keeping the maximum loan at this rate, such that when I upsize, I keep this mortgage and get a new mortgage just for the increased amount?
Cheers,
Jim
Can't comment on the first bit.
About overpaying, your money is better off in savings earning 3% than paying down a 1.25% debt. Added to this, you are almost certainly not going to get a rate on new borrowing like the one you already have so IMO you should be aiming for as great a proportion as possible of the debt on your new property to be in the form of your existing tracker. That means no overpaying, and in fact if you can claw back the overpayments you've already made, I'd do it. The lender might allow you to use the overpayment fund for new borrowing or simply to withdraw it (mine does), but if not you might be able to take payment holidays or switch to interest only.
Just don't spend the savings! And of course, if your mortgage rate goes above your savings rate, put the savings back into the mortgage.
About overpaying, your money is better off in savings earning 3% than paying down a 1.25% debt. Added to this, you are almost certainly not going to get a rate on new borrowing like the one you already have so IMO you should be aiming for as great a proportion as possible of the debt on your new property to be in the form of your existing tracker. That means no overpaying, and in fact if you can claw back the overpayments you've already made, I'd do it. The lender might allow you to use the overpayment fund for new borrowing or simply to withdraw it (mine does), but if not you might be able to take payment holidays or switch to interest only.
Just don't spend the savings! And of course, if your mortgage rate goes above your savings rate, put the savings back into the mortgage.
First thing you need to do is see if your current mortgage is portable (allows you to take it with you to the next place). If not, then forget just borrowing the extra at a higher rate, you will need to take a fresh mortgage out for the whole lot. Also bear in mind that to port the mortgage over to another house, you still need to meet their lending criteria, and if you don't they can, and will decline.
If it's portable, then you need to speak to them and see at what rate they are willing to lend any extra money at. Depending on the answer to those 2 questions, you should speak to a whole of market mortgage broker (PM me if you like) to see if there's a more suitable, or better product out there for you.
As for your job, it depends on the lender. If you are on a probationary period at the time of applying, then there may be trouble. If you are a permanent employee past any probation period, then it should be fine.
HTH
If it's portable, then you need to speak to them and see at what rate they are willing to lend any extra money at. Depending on the answer to those 2 questions, you should speak to a whole of market mortgage broker (PM me if you like) to see if there's a more suitable, or better product out there for you.
As for your job, it depends on the lender. If you are on a probationary period at the time of applying, then there may be trouble. If you are a permanent employee past any probation period, then it should be fine.
HTH
JimCross said:
Do most lenders require a minimum time in your current company, or ramp up the rate if you've not been there long?
Some have a minimum time with a company some don't. None that I know of will ramp up the rate, they simply will lend or they won't.However this:-
JimCross said:
Also, my current mortgage is a lifetime tracker at base + 0.75%, no limit on over payments. Until now I've been over paying whenever possible, which has got the LTV down to around 50%. However, given the good rate, am I better off not over paying, keeping the maximum loan at this rate, such that when I upsize, I keep this mortgage and get a new mortgage just for the increased amount?
suggests that you won't be changing lender, simply taking a further advance to cover the new mortgage. In that case you only need to know your current lenders attitude. If you want to pm the lender in question I'll find out foryou, or you could ring them yourself. If they insist you are not in a probationary period then you might have to wait to move, however they might waive that for existing customers. Again depends on the lender.
It might be worth you gong through the sums to seee if porting your current mortgage is the most effective thing to do. You aren't going to beat that rate at the moment, so its a true cost equation between what the extra borrowing will cost you, and what other lenders will offer for the entire loan amount.
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