New BTL affordability rules

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    #16
    Hi Boletus
    Thanks for your points.

    Luckily you don't have to have a separate income with BM. They are one of the lenders who do not require it. Otherwise they could have said No straight away. I simply failed the affordability test because I had to include all our expenditure (for the whole family husband included) but was not allowed to include his income.

    When I took out the BM mortgages we didn't have a joint personal mortgage (I don't know what PPR stands for). I had a house in my name with the mortgage in my name. I also took out 4 BLT mortgages at the time and this was when they wanted copies of my husbands bank statements. I have since paid of 2 mortgages and am left with 2. You would think they would see me as a safe bet. The 2 existing mortgages have a LRV of about 42%. I really am not a risk.

    The BLT properties were in joint names when we bought them and we were advised that the only way we could get competitive mortgages was to have the flats in my name (leasehold) and for my husband to own the freehold. We also had to set up a management company. And as I said before it cost us a pretty penny.

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      #17
      You sound like a safe bet to me.
      IMO BM have gone daft with their "computer says No" policy instead of using common sense.

      Originally posted by slooky View Post
      Luckily you don't have to have a separate income with BM. They are one of the lenders who do not require it.
      They do for new lending;
      For all applications, at least one of the applicants needs to be in receipt of earned income and/or pension income
      Perhaps you didn't need it as you're an existing customer.

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        #18
        slooky,

        I suggest you sell one of your mortgaged properties and try to pay off the other mortgage loan so as to have 4 mortgage free properties.

        Then no more hassle.

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          #19
          Originally posted by slooky View Post
          So is it reasonable to assume that my husband will leave me or die. I thought this was harsh considering they looked at our family income when I took out the mortgages and for some reason the mortgage end date was set to my husbands 65th birthday. I find that very strange.
          Without being too harsh, your husband will definitely die - the death rate for humans is 100%.
          And (as a married man in his 50s) the stats aren't great. Men die earlier than women.

          One of the problem with affordability now is that rent is usually treated differently to other income - some lenders ignore it altogether.
          Which is odd, because it seems more reliable to me than wages.

          It might be worth looking at the portfolio as a whole and funding that, or (as above) sell something to pay down the borrowing.

          When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
          Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

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            #20
            HI Boletus - It appears I'm not up to date with BM criteria. They must have changed them again. I know when I took out the mortgages they didn't require a separate income and then they changed it to a minimum salary of £25k. When they extended the loans last year in October the criteria said no other income required which is why I didn't think I would have a problem. They have obviously changed it again since.

            If my properties were not in the same building I would consider selling one. But my flats are all in one building hence the freehold / leasehold work done. We find this very convenient for many reasons and I can also control who lives in the building. If I sold one to pay of the other 2 mortgages I would lose control and also have to deal with a management company. We know that is an option if we were desperate. But we would have to be very desperate.

            jpkeates - thanks for stats on death rate!

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              #21
              Originally posted by jpkeates View Post
              Without being too harsh, your husband will definitely die - the death rate for humans is 100%.
              Actually a significant number of humans have not died. The overall death rate may be closer to 97%.

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                #22
                More like 93%, if you use the figures in https://www.prb.org/howmanypeoplehaveeverlivedonearth/

                But that id only the proportion who have died, rather than the proportion that had or have a finite lifespan.

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                  #23
                  Originally posted by PJackson View Post
                  Actually a significant number of humans have not died. The overall death rate may be closer to 97%.
                  The incidence is 97%.
                  The rate is 100%.

                  But I admire your optimism!
                  When I post, I am expressing an opinion - feel free to disagree, I have been wrong before.
                  Please don't act on my suggestions without checking with a grown-up (ideally some kind of expert).

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                    #24
                    The figure is estimated so is only approximate. Anyway 93 is closer to 97 than it is to 100, so what I wrote would still be correct if 93% is the correct proportion.

                    It is certainly true that some humans have not (yet) died so the death rate is less than 100%.
                    It is also true that that there is no good evidence for a human living to the age of 123. It is a reasonable extrapolation that all humans will die, but it is also probable that at some time someone will reach their 123rd birthday.
                    It might also happen that a way to extend life indefinitely will be invented.

                    My main point is that there is a lot of misuse of statistics going on, especially related to housing. One needs to be very careful to check exactly what is being referred to, especially in secondary sources where the qualifications that appeared in the original might be missing. I am thinking of a recent report by Shelter that was technically accurate, but everywhere that it was reported a greatly exaggerated imprression was given by apply the main conclusion more widely than the report justified.

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