Hi All,

I am a first time buyer. My plan is to buy a flat/house to live in it and to rent out a part. I'm pushing my project from different sides, and my priorities sometimes not ideal. Now I feel the need to ask about financing, as it bothers me)

In October I need to apply for the UK indefinite leave to remain visa (my current visa expires in October). If the application will be successful, I can apply for the mortgage.

In the meantime I:
- explore the area of my first buy (SE of London).
- network
- educate myself
- look for the demand

My questions:
1. Does it make sense to talk to a mortgage broker / mortgage adviser before visa application?
From a mortgage broker I would like to get:
- information, what kind of mortgage I can afford / to get with my income (income is not straightforward, as I am a contractor)
- approval in principle
If yes - can you recommend someone?

I think (maybe wrongly), that talking to a mortgage person will give me more clarity about what kind of deals I should look at.

2. Do I need to think about mortgages at this stage at all? Or maybe there are other things I would better do? According to Vanessa's guide for novices, a mortgage broker appears only at step 5 - stacking the deals. I'm far from it.

Please share your thoughts.

Thank you!

Julie,

The mortgage broker can explain your options in terms of financing. There might be some things you need to address in the credit file so having early warning is a positive. The visa issue is not really a block to having the conversation.

Knowing what financing will work in your situatuon will definitely shape what you look at, the areas that are likely a good fit economically and how a lender will treat the idea you will be renting out a room. All good things to know before you start looking for a property.

I did not look at Vanessa's list before replying. I would expect there are a few items on the list that can be handled in multiple different orders.

If you are in London, I run a monthly RE meeting. Or we can meet one to one if you want to discuss further your specific situation. Not that we have to do so. Just an option if it would help.

Hi Julie

No lender will consider you until you have secured Indifinite Leave to Remain status. Some lenders do consider Visa status but not with such a short time left until it expires

Being a contractor and not a permanent employee will deter some lenders but a mortgage broker can source those that will lend to contract workers. The length of time remaining on the contract will be a factor; as will the length of time you have been there already and if the contract has been previously renewed/extended.

The size of your deposit will also be important and should ideally be at least 15%.

I think (maybe wrongly), that talking to a mortgage person will give me more clarity about what kind of deals I should look at. I agree, it will help to give you greater clarity so you can search out a property that may be suitable

Do I need to think about mortgages at this stage at all? If you can't get finance, it makes the rest of it a waste of time really....so yes

Kevin Wright
07889 526979
kevinwright@thinkpositive.co.uk

John and Kevin,

Thank you for the answers, it helps.

John, I would be glad to meet for tea and a brownie (my treat)) in your secret place at London Bridge. I can make this Thursday-Friday during the day or the next week. Please let me know in PM, how it suits you.

My pleasure Julie

If you want to find out exactly where you will stand on getting a mortgage you are welcome to call me for a chat and I will give you the benefit of my broking experience.

Best wishes

Kevin

(23-08-2012 08:02 AM)Kevin Wright Wrote:  If you want to find out exactly where you will stand on getting a mortgage you are welcome to call me for a chat and I will give you the benefit of my broking experience.

Kevin, thank you for your time today.
Our conversation helped me to understand where am I, how much can I borrow and when, and what my next step will be. It's much better, than anxiety)

I am in the process of setting up a property investors resource website that will provide financing information, lender criteria & questions that will need answering to allow a DIP and or lender quotes to be provided. It will focus on HMO,BTL,Property Development, Refurbishment. I have been funding property deals for 15 years.

thanks

1st things first; sign up to http://www.noddle.co.uk and and send a £2 cheque to Equifax and Experian for your statutory reports.
This will not be that easy as you WILL have to send ID verfifiacation id you have never received a credit report.
Ensure ALL your data is correct.
If not make sure it is amended to reflect comlpetely accurrately your status.
Don't even think of formally applying for a mortgage until your files are correct.
Even obtaining DIP's are a waste of time if you have NOT confirmed that all the CRA data is correct. as by the time the info has been corrected the DIP will have time expired.
Remember under the DPA CRA's have up to 28 days to change info and lenders sometimes only send info once a month.
So it could take 2 months to update info and then you have to find out again whether the files are correctly amended.
If you request statutory reports then this could take another 2 weeks.
This is why noddle is so useful.
It is totally free and provides the same info generally as on the other 2 CRA's
Indeed you can compare the files to ascertain which ifo is not on all the files.
The other thing to ascertain is to ask the lender which CRA they use.
On an application only put the CRA info down that a lender would see.
It is their fault if they choose a CRA which does not have all your info.
Ask this as a general question to a ;lender; do not identify yourself..

However to be absolutely sure that al your info is correct obtain reports for all the CRA'ss.
You don't need one from Callcredit as that is who noddle are.
Now you can see that if reports come back incorrect you have to have things amended again.
So 6 months is how long it could take if they carry out the amendements correctly the 2nd time.
You have to do all this before even entertasining the idea of soucing finance.
A credit file is the foundation of any successful application.
Make sure the foundations are correct and then if you fail, it will have been on the basis of accurrate info.
If you fail you may ask the lender in general terms why they refused you.
Remember more than 2 formal mortgage searches a month would sound warning bells to mortgage lenders.
Therefore do NOT waste your recorded credit searches on speculative formal mortgage applications.
Recorded credit searches are valuable; do not waste them.
You should follow this CRA procedure everytime you apply formally for credit of ANY sort.

Julie,

Independent of your status today on in the near future, it sounds like Kevin was able to frame what is or what will be possible in a few months time.

To all,

As a general rule, it makes sense to speak with a mortgage broker so a future buyer has a sense of their budget before shopping for areas or specific properties.

It's been said but definitely worth talking to a broker first. I spoke to a couple of first time buyers who'd done all their own research and deduced they could buy properties in the region of 400k. As it turned out the most they would be able to buy was about 250k! A massive difference to their plans and and had they have spoken to a broker first they would have saved themselves a lot of time and disappointment.

Lisa
http://www.keys-mortgages.com