Are my bank likely to give me some of my money back?

[bobsyouruncle]

We bought our home about 3 years ago, and as we were doing well financially as the time we put down a pretty big deposit. BUT we're struggling a bit financially now, and there's one debt in particular I really want to pay off. Are the bank likely to let us get our hands on some of the money we used for the mortgage deposit? And what are the implications of doing this? Would really appreciate some advice from anyone who works in a bank or has been in this position. It would be such a weight of my mind to clear this debt.

[hifi]

i would think you would have to re mortgage.

[Piggy]

If you have a lot of equity in your home and your salaries are sufficient to cover the extra borrowings then a remortgage is probably what you want. Don't go to those companies that advertise home loans on tv. They are sharks and charge exhorbitant interest rates compared to your own lender.

[bobsyouruncle]

At the risk of sounding really thick what does that involve?

[bobsyouruncle]

remortgaging I mean!?

[SugaryBits]

I'm no expert but would say that the deposit you paid would have gone straight to the sellers of your property so is nothing to do with the bank.
So to get your hands on some money you would have to increase your mortgage.

[coolkat]

Hi we did this put 16K we had saved into buying a bigger house but then a year or so later had no money to build a conservatory and then a year later a car. We basically have one mortgage but with 2 extensions to it. As long as it is a mortgage you can afford when you compare it to your salary you should be fine - Although it may depend on the total equity you have we had about £100k so the bank were never going to lose if we could not pay.

[Piggy]

Speak to your mortgage provider and ask whether you can remortgage (increase your borrowings in return for getting some of the equity out of your house). They'll tell you pretty quickly if they'll allow it.

[Lulumama]

see an independent financial advisor

the deposit for the house does not sit in the bank, it is long gone... if you have sufficient equity ,you can borrow against that

[bobsyouruncle]

Ah the penny drops, I see what you mean. hmmmm mortgage is quite small though and house increased in value quite a bit and I don't want a huge amount - about £5000 - so maybe increasing the mortgage is the way to go.

[eandh]

I work in a bank depending who your mortgage is with depends what it is called we call it a 'further advance' as its advance on your existing mortgage.

Basically you would apply for £x amount provide payslips they would consider the LTV (Loan to value with the new mortgage amount vs amount your house is worth it may be worth noting that some lenders will only lend a maximum of 75% of the value of the house if you are using money for debt consolidation) they will do a credit check and look at outoings you have but obviosuly you would be saving money by adding a debt onto your mortgage over a longer term.

If any of the debts are in one of your sole names (Assuming mortgage is in joint names) you should be asked to do something called an 'obrien interview' takes 10mins but you are asked seperatley if you understand the implications of taking a joint debt on to pay a sole debt (the case of teh o'briens went to court and she won on this fact hence called o'brien)

If lender agree everything you'll sign an offer and they'll release funds so if you are staying with same lender can be done in 3-4 weeks.

Anothe rpoint worth considering is if you are not in any fixed trate/special deal shop around or see a broker as it could be more cost effective to move your whole mortgage plus the extra you want to borrow to a new lender, most lenders cover the solicitor fees you may need to pay an admin fee for a fixed rate but could save money each month even with the additional borrowing. This whole process should only take 4-6 weeks but may be a bit slower with xmas coming up

Hope that all makes sense let me know if you would like to know anything else

[OldenGoldie]

Or you could go to an undependant mortgage adviser, they will look at all the mortgages available and let you now your best option. They will probably save you on your interest rate, let you know all the charges involved etc. They should (if they are good) also contact your exisiting provider and check if you can get a drawdown from them. (This would be something you agred at the start of the mortgage but a lot of people are unaware of them!)

Mortgage avisers get paid commision from teh provders, it costs you no more than if you went direct and you have someone there to help you through the process with relevent advice. (Oh and they have to advise you of the best one for you they are all regulated by the FSA)

[OldenGoldie]

hmm....great minds!

[eandh]

excuse typing I get carried away typing a blimmin long explanation and forget to check it!!

[bobsyouruncle]

This is all so helpful. Going to sit down and discuss options with dh tonight. Thanks so much everyone.

[LilyLoo]

bobsyouruncle if you want some advice my dp can help he has an advert here