Bank of Scotland Tracker & Advice re: Moving

dialemma

Hi,
We have a BoS Tracker mortgage currently in negative equity to the tune of approximately 50,000. We have a lump sum deposit of 95,0000.00 plus I own a property (land with planning permission) to the value of 60,000.00. We currently rent out our mortgaged property and rent covers mortgage repayments plus small surplus. We have 20 years remaining on mortgage and are not in arrears.

We live in rented accommodation, paying 1050.00 per month in rent. I am in full time permanent employment earning 52,000.00 per annum, my husband is a company director and considered self employed, his earnings from the company is in the region of 25,000 per annum net.

We are now trying to consider our options and am looking for advice on what our options might be in terms of buying a new home. We will not be able to transfer our tracker as BoS on longer in the market. Has anybody any ideas on how other banks might view us or are there an measures we should be taking now to improve our chances of securing a mortgage.

I have a small car loan which could be repaid if required, and I have no credit card debt or any other debts, I also save a small sum on a weekly basis with the credit union. My husband on the other hand does have a credit card balance and does not make any savings. Would we be better to make our savings into a joint account? or would I be considered as a sole applicant? or would the property I own be considered as equity ?

TIA

Emma

D3PO

contact Killers1 on here. Hes a top notch broker and will be surely able to steer you in the best direction.

GavMan

For starters, get the Credit Card paid as its expensive debt and might be looked at as living beyond your means if you're not clearing it.

The car loan is not that big of a deal as its pretty normal finance, but it's obviously advantageous to have as little debt as possible.

Get your husband saving what he can regularly, keep up with your saving too.

In terms of advice, what is it you would like to do? Are you looking to keep renting the property from the BOS mortgage? Are you planning building on your land or buying something else? What is outstanding on the mortgage?

If you cleared the mortgage with savings and the proceeds sale of the house, you should have 50k approx left. That is still a very good deposit.

Where are looking to live

dialemma

Thanks for the advice, we are looking to purchase a family home in Meath, our existing mortgage is on a duplex property which no longer suits our needs. Property currently worth approx 180,000 with mortgage of 229,000. Never intended to have it as an investment property so would be relatively happy to sell if that was the most advantageous. However as we have a tracker on that property we are in the enviable position at the moment of being able to service the debt and so could envisage holding onto it if it didn't hinder us buying a family home. Won't be building on our land to live in as its down the country. Would be looking to buy something on the market in the region of 300,000.

GavMan

dialemma wrote: »

Thanks for the advice, we are looking to purchase a family home in Meath, our existing mortgage is on a duplex property which no longer suits our needs. Property currently worth approx 180,000 with mortgage of 229,000. Never intended to have it as an investment property so would be relatively happy to sell if that was the most advantageous. However as we have a tracker on that property we are in the enviable position at the moment of being able to service the debt and so could envisage holding onto it if it didn't hinder us buying a family home. Won't be building on our land to live in as its down the country. Would be looking to buy something on the market in the region of 300,000.

Cool, well obviously a bank will need to be happy enough with the 1st property being in situ but if you're paying the mortgage and rent is turning a surplus then you might be okay. But you wont know till you ask.

Assuming a deposit of 100k, a property worth 300k and a term of 25 years, you'll need to show affordability of about 1125 unstressed and about 1350 at a stressed rate. So make sure your rent and savings get to above the stress threshold. Make sure you're doing that or have been doing that for 6 months. With your family income as it is, you should be able to do that easily. Frankly, It would be a worry if out the guts of 6500 gross per month you couldn't do that.

Think your husband will need a 2 or 3 years of vouched accounts if he is classified as self employed.

The main red flag for me would be that credit card bill. If your family income is what it is, the will be asking why the balance has not been cleared. Get that cleared ASAP.

I would seek the advice of an experienced broker though as your situation is not straightforward

dialemma

Thanks GavMan, appreciate that. Will get cracking on the CC

murphaph

Yeah send a PM to killers1 and you'll surely be helped. He is very well regarded on here.