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Lilla D

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  1. Hi Jay, You mention "Home Report" and Julia assumed that you meant "Homebuyer Survey" instead. The two are very different things. The Home Report is used in Scotland and lenders do use it instead of their own valuation, so if there's any problem mentioned in it, the lender will pick up on it. We had recently quite a few lenders, who imposed a partial or full retention until the damp issues were sorted out... The Homebuyer Survey is used in England and Wales to learn more about the property beyond what the lender's basic valuation report would show (if the lender even shares a copy of it). This survey can be arranged by you independently from the mortgage application and, indeed, it's not shared with the lender, so has no impact on the mortgage. Which one do you have?
  2. Hi Neo, Yes, it is possible to generate £2k pm net income with a £600k investment in property, but if you don't know where to start, then please spend some time studying the options/strategies, the markets, mortgages, etc. before you do anything. There are many ways to skin a cat and this is especially true when it comes to making money out of property. You'll come across people who promise the Earth and get-rich-quick solutions, so my advice would be to take it easy and don't let the money burn a hole in your pocket.
  3. I would agree that not putting all your eggs in one basket is a good idea. I would also add that buying two for now is better than buying 3 or more, as lenders start to get concerned when someone is buying "too many" (which often means 3+) within a short space of time. Finally, buy the properties while you're still here, have income to prove, bank statements to show your usual household spending, as most of the BTL lenders are quite conservative and like a vanilla background for the investors. Sure, you can get a mortgage without earned income, while you're not in the UK, etc. (we deal with clients who have these circumstances), but it would just limit your lender options, increase the interest rate and complicate things unnecessarily in your case.
  4. You could consider a few things: if you are able to make overpayments, then most deals allow 10% overpayment per year. By reducing the mortgage balance, you'll also limit the increase in your monthly mortgage payments at the time of remortgaging onto a higher rate (or if you're reverting to the SVR at the end of your deal term). You could also potentially take a longer mortgage term (and pay more interest overall) or a partially or fully interest only mortgage (and not reduce your mortgage balance as fast or at all through your monthly payments) when you remortgage, but these are all subject to T&Cs and have their pros and cons, so it's not a straightforward decision.
  5. We all wish we had a crystal ball... The above dilemma has flooded our inboxes since the base rate started its climb in Dec21 - I lost count of the number of clients asking whether they should remortgage and pay the ERC. Then again, it's impossible to say how bad the situation will get before it gets better. Interest rates have risen massively since Dec21, and yet, lenders are flooded to the point that a lot of them temporarily stopped lending or restricted their offering in recent weeks. On the other hand, there are reports of reducing property sales/prices/mortgages and lenders have targets to reach, so anyone's guess whether you should take a hit or take a risk... Not sure if this post was of any help, but there you go, no one can really tell you what to do, it will have to come down to your personal preference.
  6. Hi there, You may want to check with the estate agent or the council what the property's use class category is. For reference: https://www.planningportal.co.uk/permission/common-projects/change-of-use/use-classes You may also want to speak to the council and/or your solicitor regarding the use class change, if it becomes necessary. As a side point, you mention that it's your first HMO. If you also mean that you're a first time landlord, then your lender options will be limited, as not every lender offers HMO deals for first time landlords. However, if you mean that you own single let BTL(s) and this is just your first HMO, then there may be more lenders dependent on the other details of your situation. Finally, dependent on the lay-out of the property and the works you'll have to do to turn it into a HMO, you may need bridging finance to start with rather than a BTL mortgage.
  7. In response to your question, it is not illegal to have a private charge on a property, e.g. sometimes parents do it when giving money to their offspring. I also had it for an inter-family purchase, where the father was going to stay in the property after selling the house to the daughter and he also had a charge put on it, so the daughter couldn't sell it from above his head without his knowledge and agreement. In short, I'd also question the intentions and would be inclined to refuse the charge and if they insist, just look for another property.
  8. Hi, The lender options will depend on a long list of details, the property being a student let in a low owner-occupier area is just one of them. I have clients who own student lets near universities and one of the lenders that we use is Kent Reliance. Alas, they don't deal with clients directly, you'll have to go through a broker to get their mortgage.
  9. Hi Ben, Happy to help, we deal with a fair amount of expats and foreign residents even from Australia. I've sent you a PM with my contact details, if you're still interested in having a discussion.
  10. Nothing to do with competency. There's not enough information in OP's message to give advice. He will have to speak to a broker, who can then give advice as appropriate.
  11. Hi Ben, both cases were submitted in Feb22, so even if they agreed to lend when there was a schedule in place (or in my cases, where the works were already underway), they don't seem to be acting on it...
  12. Further to Stuart's points, I've had a Barclays and a separate Santander application recently, where both buildings were undergoing works to change the status from B2. Both lenders insisted that the works were completed and a revised EWS1 form was issued before they approved the mortgage.
  13. Hi, There are a few things to bear in mind. By the sound of it, your move is a few months after your current deal ends. As you currently live in the property, any new deal would have to be on residential basis, which doesn't allow renting out the property, unless you ask for a consent to let 6-12 months after the new deal started. If you ask for it earlier, the lender will likely refuse it, as their argument is that you should have reasonably foreseen the move and should not have taken the residential deal... If you were to take a new deal and then pay off the mortgage (by using cash or by remortgaging to a BTL deal) after your move, you'd normally be hit by an early repayment charge (ERC) unless you remortgaged onto a deal without an ERC. A lot of lenders don't offer ERC-free deals, so if your lender falls into this category, then you'd have to remortgage to a new lender. As we are now at the end of April and your deal expires in May, there's a good chance that remortgaging to another lender wouldn't complete by 31 May and you'd revert to the variable rate for a short time anyway. You could apply for a remortgage on BTL basis, if you can prove to the lender that you have a new home and job waiting for you in NI and you'd only complete the remortgage when you physically make the move. This does mean that you'd be on the variable rate between 1 June and your move date a few months later, but it avoids any issues with ERC, consent to let, remortgaging twice, etc. Having said all the above, if you were just to clear your current mortgage, you'd spare yourself all the above hassle and would be free to use the UK property any way you wish - as a UK bolthole for your family, rent it out long term or as AirBnB, etc. Not having a mortgage on it would make the new NI mortgage application simpler as well. In addition, once you moved abroad, your BTL remortgage options will be limited as an expat and the rates are normally higher than for a UK resident applicant. Does the above help?
  14. It's an interesting one - the freeholder provides a written consent, but not willing to change the deed. Wonder why? As the lender asked for deed of variation, I assume that you are buying the flat to rent it out and the lender may be worried that the consent could be withdrawn. This is such a corner case that it's not in any lender's written criteria, so without asking each lender whether they could consider the case, no one will be able to give you an answer. Of course, if anyone had a similar situation, it'd be interesting to hear which lender accepted it, but even then there may be a difference in the wording of the consent that was accepted and the wording in this case... but at least it'd give an idea who to approach.
  15. Hi there, Whilst your information is not wrong, you're too early for any advice unless indeed you have 20-30% deposit right now to start things off. By the time you have 1-2 years in the UK and 20-30% deposit, the goal posts could easily change, so you'll just have to seek advice at that time. However, you'll need personalised advice, not what a friend/colleague said about someone else, as you'll never get the fully story and your situation will always be different. Find a mortgage broker you feel comfortable with and they'll take you through the whole process.
  16. Hi there, I see that there has been no response yet, as ultimately it's down to your preference. Some people prefer to get the remortgage done, get the money in their bank account ready for the next investment, so they don't have to worry about two mortgages at the same time. Others are more on the opinion that they don't want to pay for the pleasure of having a mortgage unless they have to. From lenders' point of view, some will happily release the cash to you without the new property being found, while others go to the other extreme and won't issue their mortgage offer until you have a mortgage offer on the new property, so they can feel secure that there is proof of where the money goes. Unfortunately, there's no clear answer anyone could give to you, so you'll just have to make a decision based on how you feel about it all.
  17. Just to second what Stuart said, lenders do give you consent to let until your fixed rate deal ends, but they tend to do it a year at a time. It just means that every year you have to let them know that the property is still rented and they'll give you a consent to let for another year. Another point to note is that aside from a small(ish) admin fee (£100-£200) for giving you a consent to let, a lot of lenders increase the interest rate by 0.5-1% while you're on the consent to let. Your broker will be able to check what the chosen lender's policy is. Having said this, the policy could change by the time you need the consent to let. Or you could take a fixed rate deal, which has no early repayment charge (ERC). Granted, these are normally higher interest rate deals than the ones with an ERC.
  18. Hi Ian, The exact steel construction type and roof material will determine how many lenders will be willing to consider it. Then come the usual other restricting factors: income, credit history, deposit, etc. I'd recommend finding out the exact construction details ("steel frame" and "flat roof" are not precise enough) and then speaking to a mortgage broker to understand your options.
  19. Further to Vineet's point, 2nd charges are not that cheap either. We currently have a client who asked for a 2nd charge mortgage on interest only basis. Well, we checked that, but also checked 2nd charge on repayment basis and remortgaging him together with his early repayment charge (ERC). As it turned out, his cheapest option was to remortgage with capital raising and pay the ERC, the second cheapest was to get a 2nd charge on repayment basis and it was the least cost efficient for him to get a 2nd charge on interest only basis... Granted, we didn't deal with bridging finance in his case due to the nature of his case, so the story above is just to show that 2nd charges aren't that easy or cheap to get either, even if the first charge lender agrees to it. In short, indeed, you'll need to speak to a broker to find out what your options are.
  20. That is fair enough. Would you mind sharing what happened to you, as I have never had a client's application rejected on the basis that previously they redeemed a mortgage after 6 months? As I deal with a lot of landlords, I am interested which lender you had bad experience with just in case I come across a situation similar to yours.
  21. Just to say, a lender is not going to get pissed off / blacklist anyone because they are leaving after 6 months. A mortgage is just a number to them, so don't worry about it Dependent on the lender, they normally allow you to remortgage after 6-12 months ownership for 2 reasons: 1) to discourage money laundering and 2) if you do home improvements, then it may increase the property value, especially when combined with the generally assumed continuous property price increase... If you can show the valuer what the property looked liked pre- and post-refurb and you've owned the property for minimum 6 months (unless you bought the property with bridging finance, when you can normally remortgage even within 6 months), valuers also appreciate it that a property will be worth different amounts dependent on its state. Of course, be realistic about an uplift in value (how long is a piece of string...)
  22. Hi Declan, The broker is not wrong in suggesting a cash purchase and remortgaging after the works are done and you secured a tenant. Lenders would assess the property as it is and it won't get you far by the sound of things. As an alternative, there are some lenders who offer a refurb package, which is essentially a bridging loan to buy the property and do the refurb (without making monthly payments while doing the refurb and don't have rental income) and then switch to a normal BTL deal when the refurb is done. There many ways to skin a cat, so do ask your broker about the refurb options.
  23. Hi James, You're very welcome You can always contact them directly and see what they say, but a broker can do it for you as well as advise you about details you may not have thought about (e.g. how your income / outgoings situation may impact on your options) and look at alternatives for you. Most (admittedly, not all) lenders offer the same rates directly as via brokers, so you have nothing to lose.
  24. Hi, I can't advise you about doing the right thing by buying this flat or not, but I can tell you that it is not that rare to have an absent freeholder and I have had no issues arranging mortgages once an indemnity policy was taken out.
  25. Hi James, The short answer is: it's best to finish the extension, then remortgage. Here comes the long answer. When you remortgage to another lender, there will be a solicitor involved. They check your existing mortgage and the Land Registry, make you fill out questionnaire about your situation, get the money from the new lender, which they will then distribute between your current lender and you, then update the Land Registry. Please note the "make you fill out a questionnaire" part. They normally ask you about any work that has taken place and lying (e.g. not telling them about the extension subject to building control sign-off) would count as mortgage fraud. Even if the solicitor was not asking you about any works and didn't do a planning permission check, the new lender is likely to send out a valuer and they will notice the works and will ask you about the status of things, including building control sign-off. It is also entirely possible that the lender just does an automated valuation, i.e. no valuer goes out to notice the works. But the automated valuation wouldn't (couldn't) take into account any extension, as your house (on paper) is still what it was pre-extension works. As a result, you'd get a valuation based on pre-extension works, which is not what you're after, if I understood you correctly. The problem with remortgaging before getting building control approval is that no "normal" lender will like it, so your only options would be bridging finance or taking a new deal from your current lender without releasing equity based on the lender's automated valuation. If you don't want to revert to the standard variable rate at the end of your fixed rate deal, then try choosing a deal option from your current lender which has no early repayment charge, so you can remortgage without a penalty once the building control approval is received or if you can't do that, then remortgage on like-for-like basis and take a further advance a few months later once the house is ready. Does this help?
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