A client recently called in with an enquiry with regards to mortgaging his existing property and the basic fact find details were taken.
The information provided resulted in discovering that there were two kitchens in the property and the client had some bad credit which he has now consolidated. He currently owns the property with his mother.
The client wanted his mother taken off the Mortgage and Deeds via transfer of equity. The client’s partner was to take on the mortgage jointly with the client. This would usually be a straightforward process, however the client’s mother was to remain in the property. This makes almost every lender on the market very nervous as it falls outside of their criteria.
The property has two kitchens, which whilst not being favourable with many lenders, it can be possible. Although on further fact finding, I discovered that not only were there two kitchens but also two front doors which essentially means there are two houses on one title.
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The client also has a little recent adverse credit, some historical adverse credit and he was looking to consolidate current debts. They were looking to redeem the original mortgage, which was only taken out 9 months ago, along with the second charge, and some credit card debts and loans. They were paying around £3500 per month on the property finance alone.
We persevered with this one and managed to find one lender on the entire market that was comfortable with the multi-unit aspect, the two front doors and the mother remaining in the property. We managed to save the client almost £1000 per month by consolidating debts and moving the secured loans into one at a better rate.
Things to consider:
- Almost every lender on the market will not allow someone being transferred away from ownership to still remain in the property post loan. This is because they retain some legal rights to the property.
- Properties with two kitchens are generally ok with some lenders, but if the kitchen is fully functioning and allows someone to live independently in a different area of the house as a self-contained unit, it becomes essentially a residential multi-unit on one title and it is very difficult to place.
- Historical adverse is ok dependent on what it is and when it was registered/satisfied.
- A certain amount of recent adverse is also ok, as long as it is no more than a certain amount within a certain time frame. Adverse that is against secured loans is the most damaging, unsecured is less problematic, and communication and utility adverse is the least likely to affect your ability to get a mortgage.
To know more and speak to one of our Residential Mortgage Experts, call us now on 0333 0166 600. You can also fill in this short online form to get started. Our team of Residential Mortgage Experts will get back to you straight away.
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