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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

Not AIBU but need help. Mortgage related.

53 replies

WhimpyKid · 29/03/2018 10:03

Need help regarding mortgage renewal. We took mortgage nearly 5 years ago, due for renewal in a couple of months. At that time my DH had a well paid job, around 48k. Due to it being stressful and demanding he left it to open his own business. That was around 2-3 years ago. Now, this job brings only 28k. I don’t work, we manage, never been late with any payments, bills etc. Our monthly mortgage payment is around £920. My question is can they refuse renewal with this small earnings? Will they check? Bank’s been asking to update details online but we’ve been postponing it. Me being me I worry too much sometimes. Can someone advise what do banks do in situations like that? Thank you

OP posts:
Littlemissdaredevil · 29/03/2018 10:35

Whimpy is there any way you can take up a new fixed rate online? When my fixed rate came to an end with my lender I just logged online and clicked a few buttons to accept a new deal. As I wasn’t changing anything amount the mortgage (e.g. the term or borrowing more) i didn’t have to do an mortgage application or have a credit check

I assume otherwise at the end of your fixed term deal you will just go onto the SVR (which I expect is more expensive)

BarbaraofSevillle · 29/03/2018 10:37

Check what happens if you let the fixed rate expire. If it goes onto an expensive standard variable rate, see if you can get another deal from your existing lender.

If it goes onto something like 2% above base rate as mentioned above, this is a good rate and you can just sit on it for as long as you like. Interest rates might go up a little, but I can't see them going up significantly as it will put the country back in recession.

There is often too much fear 'I must be on a fixed rate' and I think a lot of it is lenders trying to scare people into paying more than they need to by alluding to interest rates and economic conditions nearly 30 years ago that will probably never return. We've never had a fixed rate and it's always been much cheaper that way.

UnimaginativeUser · 29/03/2018 10:37

We were in a position where our fixed rate term ended just after I had gone self employed and my other half had been out of work for 18 months.

We were concerned about the impression this would give, but our mortgage adviser simply recommended switching to another fixed rate product with the same mortgage company. They didn't carry out any further checks or re-do the affordability calculations either. This might therefore be a good option for you.

In the end, we took a 10 year fixed rate as the rates are only going to go one way, and it took the pressure off having to go through the rigmarole of affordability checks when we're both self-employed with one person in a very unstable industry.

Original poster
WhimpyKid · 29/03/2018 10:39

Thank you Littlemiss, that’s what we are hoping for. Just to do it online, take another fixed rate until our finances improve.

OP posts:
ilovekitkats · 29/03/2018 10:41

I went through my financial advisor when my 5 year FR was up. I didn’t quite earn enough to switch companies but the existing mortgage was renewable online to a new fixed rate saving me £50 a month.

So you should be able to stay in your mortgage or switch to a new one with them. I’m with Santander and they didn’t want any info to change onto a different one.

LadyLoveYourWhat · 29/03/2018 10:42

You don't have to do anything, if you don't want to. Once the fixed period is up, you will just go onto the standard variable rate.

If this is above your current rate, you might want to get another deal, either with the same provider (probably no further checks if you aren't changing your term or borrowing more money) or someone else (you will have to do affordability again).

If the standard variable rate is lower than the fixed rated you've come off, you could just stay on that for a while, this is the "do nothing" option. You might want to refix though if you think rates will go up.

Missingstreetlife · 29/03/2018 10:44

The standard rate is more. We went interest only for a while. Obvs that's not a solution but gave breathing space. You can also extend the term for cheaper repayment, more expensive in long term.
Just try to get a new fix, and go from there, a mortgage is still cheapest way to borrow

freakydeakydo · 29/03/2018 10:48

Whimpykid

Is there the option for you to work? More income might be looked upon more favourably

AnnieAnoniMouser · 29/03/2018 10:57

Whimpey

What is it your current lender has been asking you for, exactly?

Original poster
WhimpyKid · 29/03/2018 10:58

At the moment I am unable to work but hopefully this will change soon.
Thank you again to everyone who replied. I really appreciate it. It put my mind at ease. A bit 😊

OP posts:
boredofwaitingagain · 29/03/2018 11:01

Hsbc (just in case that's your lender) let you move on to any of their available products - you don't have to stay on svr. No further checks that I was aware of xx

Original poster
WhimpyKid · 29/03/2018 13:27

They’ve asked to update our info online, including income.
It’s not hsbc bored.
Thank you again.

OP posts:
TimesNewRoman · 29/03/2018 13:34

The standard variable rate - which yours will change to at the end of your 5 year deal can often put the payment up considerably.
Yes moving your mortgage to another lender is a complete pain the arse, but you can end up saving a LOT by doing so.
But yeah, find out first if your current lender will check and if not then get another deal with them for a few years.

Babyplaymat · 29/03/2018 13:39

We refixed online with NatWest, no request for salary info etc.

kyrenialady · 29/03/2018 13:40

We need to remortgage soon as our fixed rate has come to the end.

They said they will need details of all outgoings due to the new guidelines of affordability coming in.

Hopefully we can still borrow what we need as we have a lot of outgoings, even though the mortgage borrowed would only be 2 x times income. If not we will have to stay on the crappy variable rate.

SnooSigh · 29/03/2018 13:42

It depends who you remortgage with, different lenders have different loops to jump through. A local mortgage adviser is your best bet. (I’ve done two renewals in the past year, one we stayed with the same lender and got a better deal, it was just a case of our mortgage adviser ticking a box)

AnathemaPulsifer · 29/03/2018 13:45

You are very likely to need 3 years accounts to evidence his business...

Socksey · 29/03/2018 13:49

As others have said .... if you stay with the same lender but either go on the SVR or switch to a retention product ( new fixed rate) thete should be no further checks.... I did this recently and with my OH not being paid etc and finances rubbish it was ok... actually ended up paying less than I was.... but you cannot ask for any further advances etc.... you literally just keep payi g on a new deal ... good luck

trojanpony · 29/03/2018 13:53

35 years at £920 pm (assuming an interest rate of 3.5%) means you borrowed about £220K - is this about right???

If so, even taking off the 5 years of payments the balance is not going to be considered affordable. I think you will struggle to get a new mortgage...a few high street banks are doing 5 x salary but your ratio way higher

I’d call L&C they are good but I’d say you need to stick with your current provider for now

Original poster
WhimpyKid · 29/03/2018 18:07

Thanks, our interest rate at the moment is 4.89%.

OP posts:
Original poster
WhimpyKid · 29/03/2018 18:08

We borrowed around £184k. Definitely not going to try another lender. Hopefully we can do it online without going through any checks.

OP posts:
Flockoftreegulls · 29/03/2018 18:55

Check how much you will pay on SVR before you fix, my mortgage went down £300 per month so I just left it on that. You can always ask to fix with current lender if it looks like it is rising.

Babyplaymat · 29/03/2018 19:04

Who are you with?

PurplePotatoes · 29/03/2018 19:11

We've just moved deals online with our current provider (Halifax) from variable to fixed and there were no checks.

RainyDayBear · 29/03/2018 19:40

We were with Halifax and they didn’t check anything when we re-fixed with a new deal. If you switch lenders they will though!