Annoyed Readers Question

by Readers Question

7:20 AM, 14th March 2017
About 4 years ago

Annoyed Readers Question

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Annoyed Readers Question

My cousin is 28 and an FTB in a relatively cheap area (2 bed terraces £125-135k). She has a 20k deposit saved up but due to her income of 20k she can only get a maximum of £82k mortgage – too short by about 25-35k. Annoyed Readers Question

I therefore thought that I could help. Relatively wealthy, good income. Could I guarantee her a loan for, say, £115k? Its easily affordable even in worst case scenarios. But no. Guarantees from anyone these days are not allowed, unless you’re a parent, and not usually then.

What if I went in as a co-mortgagor? What loan could she get then? (Frankly, I’ve got enough to buy the house in cash). She could get nothing more – of course! – because my property income, healthy though it is, cannot be taken into consideration! Why the hell not, its been going 20 years and is definitely on the north side of average?!?!

Eventually I find a lender who might offer us – combined, you understand – £118k. Whoopee-doo. But guess what? If Im a co-mortgagor, my cousin’s £200 SDLT becomes £4250 just because I’d be added to the loan. That’s REALLY helpful to a struggling FTB!

So some points become apparent:

*FTB’s are unable to get on the ladder because they cannot get mortgages, however well-backed they are.

*Given this is true, exactly which FTB’s are fueling the 100% increase in their numbers these last 6 years? Are they all incredibly well off? And if they are, renting from us clearly hasn’t harmed their prospects.

*Property income is worthless if you’re a lender, but is massively important if you’re a tax man. Funny, that…

*The new SDLT rules stink.

*Talking of SDLT, the government keeps on about making property equal to shares, yet stamp duty on shares of £135k is… £675. Not bloody £4250!



David Price

9:08 AM, 15th March 2017
About 4 years ago

Reply to the comment left by "Laura Delow" at "15/03/2017 - 07:34":

Never fear HMRC will no doubt find some way to tax the gift ! ! ! !

David Price

9:11 AM, 15th March 2017
About 4 years ago

Why not take your niece's £20k and give her a private mortgage for the rest of the purchase? It would seem to be a win win situation for all save the commercial lenders (who can rot in their own financial hell as far as I am concerned) and HMRC. You get a much better return on your money and she gets a much cheaper loan. The downside is that your capital is tied up for 20 years.

Gillian Schifreen

9:32 AM, 18th March 2017
About 4 years ago

We've come across this a lot when hubby was employed plus we had the rental properties, all on long term lets, giving us good returns we were told we could only borrow against his salary. Why can't the rental income be taken into account? Well we were told you might lose your tenants. Well he might lose his job but as least with the former we've got a house!!! It makes absolutely no sense.

Chris @ Possession Friend

18:32 PM, 18th March 2017
About 4 years ago

Speak of the Devil, did you hear that the London Evening Standard has appointed him ( Ozzy ) as Editor !!! this week.
What on earth possessed them ?

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