Unlocking the collateral in my house.

theredguy

theredguy

theredguy

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Hi i'm after some advice please.

Basicaly i bought my house with cash almost 7 years ago and so have never had a mortgage, i am now at a stage where i want to start modernising it and want to borrow against the property to do the work.

This is where i seem to be having the problem, i have talked to the company who i have a small loan with and they have said that because i don't have a mortgage they can't help me even with a secured loan as they see me as a fist time buyer, is this the reaction i am to expect from most lenders and if so has anyone got any recommendations for companies that have policies in place to deal with people in my situation as it really seems very odd that in order to get anywhere i have to buy the house from myself or so it would seem.

Many thanks.
 
you can get a mortgage against the property i would have thought.

you may well have to prove that the changes you want to make will up the value of the property by the same amount.

surely you owning your property is a whacking great advantage when getting money.

seek financial advice from your bank manager.
 
lozza23_uk said:
surely you owning your property is a whacking great advantage when getting money.
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I would have thought people would be bending over backwards to lend the OP money secured on the property which has no other debt! Maybe try a few other places?

You may find that as you haven't had any debt, you actually don't have a good credit record as you haven't proved that you can handle it.
 
Wow, I'm kinda surprised at the response from the company where you've got your loan. I guess they've got their reasons, but it seems a strange stance to take. Is it a high street bank kinda place?

Considering the amount of mortgage you'd be looking to take compared to the value of the house, I'd have thought that they'd be jumping at the chance to offer you something.

Even if you wanted the cash to buy a car and go on holiday, say for example £20K, the risk to them is minimal, becuase if you default they've got the value of the entire house minus the £20K you've spent on fast cars and fast women... no matter where you live in the UK (with maybe the exception of Sellafield..?) your house would be worth much more than you're looking to borrow. It's a no-brainer for them, I'd have thought.

I'd pop in to your local bank or building society and see if they have the same hang-ups.
 
goto an independant financial advisor.

any financial instituion will lend you money secured against your property.
 
A "Secured loan" can be called a "Second Charge" in the industry, the "First Charge" is held by the Mortgage Lender. So, as you don't have a mortgage, no one can lend u a loan secured on your property. (u need a first charge to set up a second!)

A mortgage is abit more complicated than a secured loan because initially you will have various checks done on the property by solicitors and a survey. A secured loan is simpler to set up.

You have to apply for a mortgage, this doesn't have to be set up as a first time buyer or anything and u don't have to sell your house to yourself. It should be fine to set up if you have a job and half decent credit record.


(i work for Abbey in mortgages BTW!)
 
fishlick said:
A "Secured loan" can be called a "Second Charge" in the industry, the "First Charge" is held by the Mortgage Lender. So, as you don't have a mortgage, no one can lend u a loan secured on your property. (u need a first charge to set up a second!)

A mortgage is abit more complicated than a secured loan because initially you will have various checks done on the property by solicitors and a survey. A secured loan is simpler to set up.

You have to apply for a mortgage, this doesn't have to be set up as a first time buyer or anything and u don't have to sell your house to yourself. It should be fine to set up if you have a job and half decent credit record.


(i work for Abbey in mortgages BTW!)
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Thanks for that it explains a lot, well i now have two more stumbling blocks in the shape of me not having the best but not the worst credit record and my house is made of concrete rather than brick. :(
 
just apply for a mortgage, if your credit record is a problem, it'll be picked up early on before u pay any fees and get your hopes up.

if your house is concrete, you will need (and should have from when u purchased ) a valid "PRC certificate". this should be picked up on the survey and might cost you £200-500 if u need to get it done yourself. If you have a certificate, it shouldn't be a problem to get a mortgage.
 
theredguy said:
Thanks for that it explains a lot, well i now have two more stumbling blocks in the shape of me not having the best but not the worst credit record and my house is made of concrete rather than brick. :(
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Prefab concrete or formed?
 
Have a word with your bank/any bank/any building soc. We (HSBC) tend to like these sorts of things as lending is generally judged on the % of loan to valuation (£100k house and £30k secured loan giving 30% LTV) and also disposable income. Financial Services Authority are getting stricted on lending so you will have to prove how much you earn and what your iutgoings are.

For something like this, you will also have to have avaluation done via the financial institution (c.£150) and other costs associated will be charged (sols fees etc). Then again, should only take a few weeks beginning to end, a bit more if any issues are thrown up.

Adam
 
As far as i was aware you couldnt mortgage a concrete prefab unless you did some structural work.

So if the house is worthless to the bank,if they can sell it on(not a lot of people want to pay cash), then they dont want to know.
 
Jonny ///M said:
As far as i was aware you couldnt mortgage a concrete prefab unless you did some structural work.

So if the house is worthless to the bank,if they can sell it on(not a lot of people want to pay cash), then they dont want to know.
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Why cant yu mortgage a concrete house seems a little odd? :confused:
 
You need...

cv3tcm1864747vi2.jpg
 
Tefal said:
Why cant yu mortgage a concrete house seems a little odd? :confused:
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Yep. I want to know the answer to this one, too. I wouldve thought that a concrete house is stronger and will last longer than a brick built house. As an example, apartment blocks usually have a concrete skeleton due to the strength it provides.
 
Odd, reminds me of a similar time when HSBC were spamming me to upgrade to a student account so i can get a credit card. So i applied in the end as a credit card is widely accepted when compared to a solo card. So after numerous trips to the bank, etc, they then send me a letter a week after my application telling me that basically because im not in debt (or having ever been in debt) they would not let me have the student account.

So makes me think, why were they spamming me to upgrade? Surely me not being in debt is a good thing? But of course the bank is there to make money so they want me to be in debt to them....
 
Because you cant get a mortgage on a concrete house (or rather, very few companies lend on such a property).
 
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