Mortgage Advice

[McKay]

I'm not sure if this is the correct place to put this but I would like to ask Dosbods for advice as it seems like there are some knowledgeable and helpful people here. 

I've just built a house but now I have to pay for it!

I was lucky to have the builder partly finance the build but now I have to find a mortgage to pay him. I have a broker currently working on finding me a mortgage deal but mortgages and debt are not things I have much experience in and would be interested in hearing what pitfalls etc to avoid.

Cheers for any help.

[spunko]

13 hours ago, McKay said:

I'm not sure if this is the correct place to put this but I would like to ask Dosbods for advice as it seems like there are some knowledgeable and helpful people here. 

I've just built a house but now I have to pay for it!

I was lucky to have the builder partly finance the build but now I have to find a mortgage to pay him. I have a broker currently working on finding me a mortgage deal but mortgages and debt are not things I have much experience in and would be interested in hearing what pitfalls etc to avoid.

Cheers for any help.

Not really my forte but just wondering how you've managed to negotiate that the builder foots the initial bill (partly). Not heard of that before, seems like a big risk for them!. Is he a mate?

 

[Phil]

I'd be a tad worried if I was the builder. It would have to be a very good mate or family member with assets imo.

[McKay]

53 minutes ago, spunko said:

Not really my forte but just wondering how you've managed to negotiate that the builder foots the initial bill (partly). Not heard of that before, seems like a big risk for them!. Is he a mate?

 

Known the guy for twenty years. It’s a risk for him but he’s getting paid well for the risk. So long as I can get a mortgage..

Also most of the bill has already been paid. 

[HousePriceMania]

1 hour ago, McKay said:

Known the guy for twenty years. It’s a risk for him but he’s getting paid well for the risk. So long as I can get a mortgage..

Also most of the bill has already been paid. 

Bung him some cash and tell him to go bankrupt.  Jobs a good 'un

[PETR4]

19 hours ago, McKay said:

I'm not sure if this is the correct place to put this but I would like to ask Dosbods for advice as it seems like there are some knowledgeable and helpful people here. 

I've just built a house but now I have to pay for it!

I was lucky to have the builder partly finance the build but now I have to find a mortgage to pay him. I have a broker currently working on finding me a mortgage deal but mortgages and debt are not things I have much experience in and would be interested in hearing what pitfalls etc to avoid.

Cheers for any help.

How much do you need to borrow?

Options at 10k are very different to 100k and very different again at 1M!

 

[eek]

1 hour ago, PETR4 said:

How much do you need to borrow?

Options at 10k are very different to 100k and very different again at 1M!

 

Also options when you need to borrow less than 60% of the value (probably the case) differ from if you need to borrow 95% of the value.

[McKay]

2 hours ago, PETR4 said:

How much do you need to borrow?

Options at 10k are very different to 100k and very different again at 1M!

 

70 grand. 

[HousePriceMania]

1 minute ago, McKay said:

70 grand. 

Buy a BTL and rent it out, sell it 12 months later, bish bash bosh, pay the man back

[spygirl]

9 minutes ago, McKay said:

70 grand. 

How much is the house values at?

Hiw much free cash do you have - dont say you funded it on a credit card.

[McKay]

12 minutes ago, spygirl said:

How much is the house values at?

Hiw much free cash do you have - dont say you funded it on a credit card.

I’m probably around 15% LTV, got around 10k in cash. I don’t really fancy getting into the financial details to be honest, I’m wary of looking like a prick but seeing as you asked I’ll do you the courtesy of answering. 

I was just interested in opinions on the current mortgage market and advice on avoiding making financial mistakes from people with experience. 

Do I use a broker? Banks to avoid? Best to use a solicitor? Recommended lenders? That kind of thing. 

[spygirl]

54 minutes ago, McKay said:

I’m probably around 15% LTV, got around 10k in cash. I don’t really fancy getting into the financial details to be honest, I’m wary of looking like a prick but seeing as you asked I’ll do you the courtesy of answering. 

I was just interested in opinions on the current mortgage market and advice on avoiding making financial mistakes from people with experience. 

Do I use a broker? Banks to avoid? Best to use a solicitor? Recommended lenders? That kind of thing. 

A mortgage under 60% ltv is a doddle.

Use a broker.

Your situation is unusual.

[spygirl]

Hsbc is by far the best bank to borrow from.

They offer the cheapest loans.

But you've got to get over their hurdles.

 

 

[PETR4]

1 hour ago, McKay said:

I’m probably around 15% LTV, got around 10k in cash. I don’t really fancy getting into the financial details to be honest, I’m wary of looking like a prick but seeing as you asked I’ll do you the courtesy of answering. 

I was just interested in opinions on the current mortgage market and advice on avoiding making financial mistakes from people with experience. 

Do I use a broker? Banks to avoid? Best to use a solicitor? Recommended lenders? That kind of thing. 

I wouldn't use a broker as they will charge a fee and they lie about best rates and so on. 

I agree with spy about HSBC. I would avoid Barclays and "specialist" lenders.

Choose capital repayment at the lowest interest rate for the longest fix.

The best place to start will be your current account holder or the bank that your income is paid into as they will understand your financial situation best.

If you don't have a credit card, get one and pay the balance in full each month to improve your credit rating.

[Yadda yadda yadda]

12 hours ago, McKay said:

I’m probably around 15% LTV, got around 10k in cash. I don’t really fancy getting into the financial details to be honest, I’m wary of looking like a prick but seeing as you asked I’ll do you the courtesy of answering. 

I was just interested in opinions on the current mortgage market and advice on avoiding making financial mistakes from people with experience. 

Do I use a broker? Banks to avoid? Best to use a solicitor? Recommended lenders? That kind of thing. 

I'm guessing that you don't need a long mortgage. Perhaps just 10 years. As you've built the house to your specs I also presume that you don't intend to move within that time frame. I would be tempted to fix for the full 10 years - if my assumptions are correct. Five years minimum.

Look at a site like moneysavingexpert (yes, I know Martin Lewis is a twat) and use the mortgage comparison thing to get an idea of the best rates available to you. Put in your predicted home and loan values and it will chuck out a load of deals with the cheapest first. There are options to refine via fixed/variable/length, etc. You can ignore any small lenders if you want and look only at reputable banks. This will give you a good idea of what you can get.

If there is a deal you particularly like then you can apply direct. I would use a no fee all of market broker first to see if there is anything better as not all deals are visible to the consumer. As you don't need a large loan by mortgage standards you might not bother as potential savings will be minimal.

You will probably need to supply bank statements as well as pay slips or proof of income. A good idea to check your credit report too in case there are any errors on there. Everything is probably fine but better to be certain.

I expect it will be very easy for you but it does take longer than opening a bank account.

[Sasquatch]

11 hours ago, PETR4 said:

I wouldn't use a broker as they will charge a fee and they lie about best rates and so on. 

I agree with spy about HSBC. I would avoid Barclays and "specialist" lenders.

Choose capital repayment at the lowest interest rate for the longest fix.

The best place to start will be your current account holder or the bank that your income is paid into as they will understand your financial situation best.

If you don't have a credit card, get one and pay the balance in full each month to improve your credit rating.

We were with HSBC, now with Barclays. Both absolutely fine. Didn't use a broker for either mortgage, simply applied directly.

More complicated for us as we run our own business but once we'd provided reams of paperwork they were happy.

[onlyme]

Do you have a lots of money flowing through your books / personal account, or do you have cash reserves that you have set aside?  If so an offset mortgage if they are still available at half decent rates could be a good contender, there were obviously some very low rates on fixes and other products available the last couple of years but those are gone so an offset is back in frame. Basically stuffing the offset savings part with as much as you can and you only pay interest on the balance. Want one with flexibility i.e. monthly calc for interest payable, no penalties or restrictions for money in or out of the account. Nice thing is you basically have a low (prevailing mortgage rate) loan account too if for any reason you need to dip into savings again. Coventry BS is ours and has been good.

[Pinkpanther]

I've been direct with HSBC and now with their subsidiary First direct. 

[McKay]

On 12/01/2023 at 09:36, onlyme said:

Do you have a lots of money flowing through your books / personal account, or do you have cash reserves that you have set aside?  If so an offset mortgage if they are still available at half decent rates could be a good contender, there were obviously some very low rates on fixes and other products available the last couple of years but those are gone so an offset is back in frame. Basically stuffing the offset savings part with as much as you can and you only pay interest on the balance. Want one with flexibility i.e. monthly calc for interest payable, no penalties or restrictions for money in or out of the account. Nice thing is you basically have a low (prevailing mortgage rate) loan account too if for any reason you need to dip into savings again. Coventry BS is ours and has been good.

Interesting, thanks. What advice do you have on overpaying? Ten per cent or less overpayment with no penalties seems to be the norm.