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[crumpet]

Hi Everyone,

I'm hoping to buy a house this summer. I have heard it is a lengthy process in the UK and so I'd like to get going on it soon so I can move before or during the fall. As a first-time buyer and an American, I feel a bit out to sea with the process here and could use some general and specific advice!

I'd like to sort out the mortgage component so I can make sure that my own financial calculations are realistic. Do any of you have any suggestions about how to find a good one? I'm interested in something fixed rate and fairly conservative/dependable.

Aside from that, are there any general words of wisdom about how the process progresses?

[fourhats]

I am also an American, and spoke to my UK bank last year about a mortgage.  They told me that despite being a long customer, I would need to have 18 months of UK salary history (they wouldn't count my American salary), with taxes shown, before I could be considered for a mortgage.  In other words, I would have to be working there for a year and a half before I could even apply.

[daniel_von_flanagan]

I moved there in the 80s as a postdoc, and got a 100% mortgage at a building society based on my University connection.  The total time between my decision to buy and moving in was around a month.  Times seem to have changed!

I do suggest a local building society (if such still exist) rather than a national bank.
- DvF

[reflexivity]

Hello crumpet, just to add to DvF and fourhats' points:

As far as I can tell, 100% mortgages are now almost unheard of (I wish it was still possible, DvF!). I am house-hunting too, and generally, you will need at least a 10% deposit. Mortgage deals also seem to get better the higher the deposit you can offer (up to around 40% of the purchase price; there seems to be no difference after that).

When it comes to working out the mortage deals, most banks (there are very few traditional building socieites now) have online calculators so you can work out what's possible. Here is an example:

https://mortgages.hsbc.co.uk/mortgage-calculators/

The following link offers a good checklist of the house buying process in England and Wales:

http://www.home.co.uk/guides/buying/

Unsurprisingly, the site is trying to sell stuff too, but you could ignore that!

If you are looking for a house in Scotland the system is different. The Scottish Government provides a guidance leaflet here:

http://www.scotland.gov.uk/Publications/2001/03/8678/File-1

I am local, so I have not had the same experience, but I think that fourhats point about a minimum residency period may be typical. I wonder if a large deposit (less risk for the bank) might make a difference, but you would need to check with individual lenders I guess.

[chaosbydesign]

Do you want to buy my house, Crumpet?

[fourhats]

It wasn't just a residency requirement; I was already living in the UK but it didn't count toward the 18 months requirement because I wasn't paying UK taxes during that time. You also need a UK (not US) credit history, and a good down payment.

Chaos, where is your house?

[chaosbydesign]

It wasn't just a residency requirement; I was already living in the UK but it didn't count toward the 18 months requirement because I wasn't paying UK taxes during that time. You also need a UK (not US) credit history, and a good down payment.

Chaos, where is your house?

PM'd you.

[wegie]

When I was last looking, I used the comparison tools at Charcol.

Mortgages where the rate is fixed for the lifetime of the mortgage, like you have in the US, are very rare here (as you've probably found out). The best you're likely to get is a fix for the first five years, and they're looking pretty pricey at the moment.

[scotia]

When I was last looking, I used the comparison tools at Charcol.

Mortgages where the rate is fixed for the lifetime of the mortgage, like you have in the US, are very rare here (as you've probably found out). The best you're likely to get is a fix for the first five years, and they're looking pretty pricey at the moment.

Not to mention that they can be expensive to get out if you decide you want to move and not take out another mortgage with the same company.

[wegie]

When I was last looking, I used the comparison tools at Charcol.

Mortgages where the rate is fixed for the lifetime of the mortgage, like you have in the US, are very rare here (as you've probably found out). The best you're likely to get is a fix for the first five years, and they're looking pretty pricey at the moment.

Not to mention that they can be expensive to get out if you decide you want to move and not take out another mortgage with the same company.

Oh yes.

Something like five grand in early redemption penalties when we paid off the mortgage on Wegie Towers I.

[expatinuk]

Go to an independant financial advisor and let him/her to do the work of getting you pre-approved for a mortgage. That will make your house buy experience a lot easier and faster.

[crumpet]

It wasn't just a residency requirement; I was already living in the UK but it didn't count toward the 18 months requirement because I wasn't paying UK taxes during that time. You also need a UK (not US) credit history, and a good down payment.

Chaos, where is your house?

PM'd you.

Let me know too...

[crumpet]

I have been in the UK for almost two years so I think I'm okay with respect to my credit history. I had hoped to buy a house upon arrival and then found out that I had to build an entirely new credit history. There are all sorts of things like this that didn't occur to me at first and make me a bit more anxious now.

Hello crumpet, just to add to DvF and fourhats' points:

As far as I can tell, 100% mortgages are now almost unheard of (I wish it was still possible, DvF!). I am house-hunting too, and generally, you will need at least a 10% deposit. Mortgage deals also seem to get better the higher the deposit you can offer (up to around 40% of the purchase price; there seems to be no difference after that).

When it comes to working out the mortage deals, most banks (there are very few traditional building socieites now) have online calculators so you can work out what's possible. Here is an example:

https://mortgages.hsbc.co.uk/mortgage-calculators/

The following link offers a good checklist of the house buying process in England and Wales:

http://www.home.co.uk/guides/buying/

Unsurprisingly, the site is trying to sell stuff too, but you could ignore that!

I am local, so I have not had the same experience, but I think that fourhats point about a minimum residency period may be typical. I wonder if a large deposit (less risk for the bank) might make a difference, but you would need to check with individual lenders I guess.

Thanks for all of this. It looks really helpful! I have felt a bit lost trying to find a good place to get a mortgage and a lot of my local friends bought houses prior to the collapse so the rules were completely different back then in the glory days!

[snape]

I got my mortgage through London and Country (recommended to me by a friend). http://www.lcplc.co.uk/ A 15 minute chat on the phone should be enough to determine whether or not a mortgage might be possible.

[drspouse]

I've used the online comparison tool at moneysupermarket.co.uk - similar I imagine to the Charcol one.

It makes various helpful suggestions including costing your mortgage over 5 years because that is how often most people change their mortgage (note: not how often they move).

We have an offset mortgage - which we love - a current account and mortgage in one.  We have done some home improvements, added a portion to the mortgage to buy a rental property, and paid off a chunk with an inheritance, and we're about to pay off another chunk with an endowment that's going to mature, all without lifting a finger to change the mortgage, but also saving a lot of money. Basically you get your savings at a mortgage rate, and you get a small loan at a mortgage rate too.