Grainne Jordan, head of underwriting at Money Partners Touch
“Theresa’s relatively short length of self-employment may prove to be an issue with many lenders. However, there are exceptions to this rule.
At Money Partners Touch we would not require an accountant’s reference to progress this case. Rather we would take 50 per cent of her income into account in our affordability calculation ensuring that this covered her new mortgage payment and any remaining unsecured credit. We would also ignore the CCJ registered against her as part of our qualifying criteria.
With the Money Partners Summer Specials we could offer her our MPL Prime product on a two-year fixed rate of 5.99 per cent, with no overhang.
The £70,000 Theresa owes her existing lender will mean she should qualify for a free valuation. If she were to appoint the solicitor recommended by Money Partners to act on her behalf, all legal costs would be included in her completion fee.”
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Chris Clarke is from pi financial Dixon Sutcliffe & Co
“The cheapest option for Theresa would be to find out from her creditors what options she has to reduce her payments. She should also approach her current lender and ask for an unsecured loan or a further advance.
Her current lender allowed her a mortgage in the first instance, taking into account her CCJ. As long as her payment profile has been satisfactory, it may be willing to lend without any conveyance, broker or large fees. However, a valuation and admin charge will normally apply.
Should her current lender be unwilling to lend, Theresa should ask an adviser to source a non-conforming lender that would consider her on a self-cert basis. This may prove difficult as most will require at least 12 months of self-employment.
As a last resort, Theresa could apply for a secured loan from a third party, although the charges that precede these types of loans tend to be very high.”
Paul Suchet is managing director of Money Plus
“Theresa could go with Kensington on its near-prime self-cert range, as it ignore CCJs registered over 24 months. An application with a loan amount under £250,000 is processed on a ‘true self-cert’ basis and there is no minimum term of self-employment.
It has the best fixed rate options: two and three-year fixes through Solent and PMS at 5.80 per cent and 5.75 per cent respectively. Both allow an extra 0.10 per cent loading for flexible features, but have an arrangement fee of £1,995.
Her other option is LMC which also does ‘true self-cert’ on a loan of this size and loan-to-value and has no minimum term for self-employment. It has a two-year fix of 6.34 per cent with a £799 arrangement fee.
If she wanted a tracker, she should opt for LMC’s Base Rate plus 0.30 per cent two-year tracker with a £799 fee.”
