IS MY MORTGAGE LEGAL sign with no financial working income

[Lawbird Lawyer]

Dear Sarah,

Your loan is legal, yes. Banks have freedom to give or deny a loan.

I honestly believe I had made it clear in my first line in my reply to you.

As I wrote, mortgage loans have been granted in the past on the basis of self-certified mortgages, meaning there was no evidence whatsoever of the income of the borrower, such as in your case.

It all fell down to the assets he held and his word on what he earned annually. These type of loans are no longer accepted in Spain post credit crunch. The catch was that lenders applied much higher opening commissions and interest rates to these type of loans as they were deemed to be far more risky. Maybe that's exactly why you are now paying a hefty 5,75% interest rate for the privilege of a mortgage loan.

It's the bank's problem (and yours for agreeing to such harsh terms) if they lend money recklessly. But ultimately it will be all of us taxpayers who will pay for these blunders.

Another matter is what responsible lenders ask for normally to issue a binding offer (P60, last 6 payslips etc.). That falls to them, you are mistaken to theing every lender requests the same docuements or they follow the same lending criteria. A mortage loan is not illegal because they've failed to request your P60. Each bank had different risk tolerance thresholds and that's why many savings banks have run into financial trouble and are busy scrambling to merge with other savings banks.

Yours faithfully,
Raymundo LarraÃ*n Nesbitt

[sonia275]

HI Sarah

It may sound strange being able to take out a mortgage without having to produce proof of income - but this was a common practice around the times you are talking. We had similar "Self certificate mortgages" in the UK where you don't require borrowers to produce their monthly income payslips.

These mortgages existed, simply because millions of people cannot produce proof of income - they because are self employed, they have two jobs, they rely on bonuses or they work off commission. This doesn't mean they on't earn enough money to get a mortgage, they just can't show definite evidence - but self certificate mortgages were very common products in those days to help people who didn't want to show income.

So its very likely that your mortgage is legal. But now such mortgages have been stooped by many banks and that's why maybe friends are saying yours was not legal, which is simply untrue

cheers

[q070QBw]

Hi Sarah

I agree with the previous posts, a friend went through the same experience and it was explained to her through mortgage advisors exactly what has been previosuly mentioned. So no need to worry, if you need more advice you should search online for mortgage advisors and tell them about your situation.