Mortgage advise

technician · Post by **technician** » Sun Dec 11, 2005 10:00 am

Hello,

My HSMP extension is due next year in April 2006. My job is quite stable in the company and I hope that it will go for years to come.

Can I go for a two bedroom house or flat mortgage.

I have NI, Bank account, contract letter, pay slips, Driving licence is on its way.

Please advise me and how to start with?? I am confused.

Regards,

TECH

Post by **John** » Sun Dec 11, 2005 10:05 am

Technician, you are currently in your first year. I think you need to wait until you have that HSMP extension but armed with that I would expect you to be able to get a mortgage and buy a place, subject to all the usual requirements ... in particular the ability to afford to make the repayments.

technician · Post by **technician** » Sun Dec 11, 2005 10:25 am

Hello John,

Thanks very much for the instant reply. You are right that I should wait for the extension.

Frankly speaking I want to do some research work about Mortgage planning and want help from the superb and highly informative immigration board.

I can easily make a monthly repayment of about 900/= pounds.

Please I could not understand what you meant to say by

"I would expect you to be able to get a mortgage and buy a place, subject to all the usual requirements ... in particular the ability to afford to make the repayments."

Thanks

Tech

Post by **John** » Sun Dec 11, 2005 12:35 pm

A mortgage is only granted if the lender is happy that the house or flat will give them the security the they require, so the place will need to be valued to ensure that is the case. Also the solicitor acting for the lender will ensure that the seller actually owns the place at the moment, that any present mortgage is paid off .... etc etc.

The lending to you will be subject to a credit search, so you being on the Electoral Register at your current address can only help. You are a Commonwealth Citizen? If so, are you on the Electoral Register already?

technician · Post by **technician** » Sun Dec 11, 2005 10:47 pm

Thanks John,

I will do more search and research and let you know the outcome.
By the way I am from common wealth nation and been on electoral register rolls.

Thanks,

TECH

Kayalami · Post by **Kayalami** » Sun Dec 11, 2005 10:57 pm

The lender will need to be satisfied of your ability to meet repayments for a substantial period of time let alone to term. Your visa (and thus potential employment) expires in a few months - the lender is not concerned about your extension issues given they have no control over such so they are likely to refuse an application. IMHO hold back on a mortgage application until you have had your extension. Ultimatley though the decision is yours.

technician · Post by **technician** » Mon Dec 12, 2005 6:55 pm

Thanks Kayalami,

Frankly speaking I will finalise the deal only when the extension comes to my hands only...... I am totaly new to this Mortgage or property funda and gaining some experience so that I can talk to the agents. I have an appointment with lloyds bank, I will post the outcome on the forum.

Kayalami I could not understand what you meant to say by

"IMHO hold back on a mortgage application until you have had your extension"

IMHO ??

My level of english is not very high, Government Schools in India not Public school. Kayalami please explain

regds,

Tech

Post by **John** » Mon Dec 12, 2005 7:52 pm

IMHO ??

Simply .... in my humble opinion!

That and lots more explained here.

technician · Post by **technician** » Tue Dec 13, 2005 8:15 pm

Hello John,

very sorry about that.

Tech

Rogerio · Post by **Rogerio** » Fri Dec 16, 2005 9:39 am

You should buy a magazine called "Your Mortgage" which is sold in any newsagents. This explains a lot of the jargon and also gives you step-by-step information on what you need to purchase a home.

Also, there is quite an informative book called "living and working in the uk" by David Hampshire, which gives you a lot of information on various aspects of the UK, plush the buying/selling of houses in England & Scotland (the process is different).

As for waiting or not waiting, as others have said, it is very personal and some banks are happy to, and some aren't to lend to people with temporary grants to stay.

When I applied for my mortage (at the time with Intelligent Finance), I was on a work permit, but I was never asked about my "condition" in the UK. And as a result, I never brought the subject up to them. But Halifax (funnily enough owner of Intelligent Finance), did ask.

The lending criteria will pretty much depend on the bank or building society you go for.

Good luck with the renewal.

Smit · Post by **Smit** » Mon Dec 19, 2005 3:56 pm

If I may post some thoughts I had regarding obtaining mortgages vis a vis the immigration status of a mortgagor.

I wonder why most banks are/would be reluctant to grant a mortgage to persons on short stay visas e.g. 1st year HSMP visa holders as the ultimate security the Bank would hold is the propertly itself which is only conveyed to the mortgagor on redemption of the mortgage.

What would make a person with British Citizenship/residency more attractive than a person without such citizenship/residency as opposed to say someone's abilility to keep up with mortgage payments irrespective of his/her country of residence? e.g. many immigrants have a healthier bank balance than Her Majesty's citizens- why would a Bank still give priority to a citizen?

Just thought I would share my 0.0002p worth of thoughts.

Post by **John** » Mon Dec 19, 2005 4:18 pm

Smit, I think it comes down to this. Yes the bank or mortgage company will have security in the property, so should not end up losing money in the event of a default. However they also have a responsibility to ensure that people can afford the repayments as they fall due. So if someone just has a one-year visa that might well raise a doubt in the mind of that potential lender.

So I really don't think it comes down to priority being given to British Citizens, but the simple doubt or uncertainty about the income stream needed to ensure the repayments can be made might be enough to put off some lenders.

But it is a very competitive marketplace out there. Just because one lender says no does not mean they will all say no.

Smit · Post by **Smit** » Mon Dec 19, 2005 4:45 pm

John,

I appreciate your comments.

As far as job security goes, a citizen can also be made redundant, or be dismissed, or be out of employment for a long time etc. (Anyway, the point I am trying to make is that bank's should not tie down mortgage decisions solely to a person's immigration status-as it just doesn't make commercial sense).

I am not speaking from personal experience but just overheard a debate on this topic which got me thinking...

Post by **John** » Mon Dec 19, 2005 5:02 pm

I find it useful to try to put myself in the other person's position and consider how I would deal with a certain matter. So Smit I invite you to think of yourself as a mortgage company!

You institute a policy to ensure that no more than 90% of valuation is ever lent. And you need proof that the repayments can be afforded. You also decide to cut out cases where the "hassle factor" may be above average. So you not only cut out those with a poor credit score but also those facing redundancy, those with only short-term confirmed permission to work in the UK, etc etc. Now even with that policy in force you will not succeed in cutting out all the hassle but you might reduce it successfully.

Many lenders in the marketplace adopt these sorts of lending policies. But others do not! Maybe approaching a mortgage broker such as Charcol will help you find the sort of deal you are looking for? They will tend to know the various lending policies and save a lot of time in knowing who not to apply to.

Smit · Post by **Smit** » Mon Dec 19, 2005 5:34 pm

Although I was issued with ILR many years ago (not applied for naturalisation yet due to personal reasons), I have not yet applied for a mortgage as I consider the property market too high.

I was passing by the Estate Agents the other week and did an about turn when I saw a property going for £250K, I recall the same property going for £50K in my student days in the early 90's. Needless to say I was kicking myself! Anyway, that's life...

Maybe the same property will be £500K in a few years time and I will be kicking myself again...

MWazir · Post by **MWazir** » Mon Dec 19, 2005 6:12 pm

.....I have not yet applied for a mortgage as I consider the property market too high.

I was passing by the Estate Agents the other week and did an about turn when I saw a property going for £250K, I recall the same property going for £50K in my student days in the early 90's. Needless to say I was kicking myself! Anyway, that's life...

Without digressing too much from the main topic...

I find myself in a smiliar position and I can identify with this. Whats worse is, as the prices keep sky rocketting, it makes the life of first time buyers even more difficult. I dont know if I can ever afford a mortgage for the kind of house I am living in. I also think new buyers should watch out for negative equity where you end up owing the bank a lot more then the house is actually worth because the bullish trend in the housing markets has reversed.

technician · Post by **technician** » Mon Dec 19, 2005 6:19 pm

Hello,

Never regret the past, instead learn lessons from the past and act accordingly.

Tech

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Mortgage advise

Mortgage advise