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Choosing a Mortgage

Choosing a mortgage may be your most important financial commitment. The Society will provide you with information on the different types of mortgage product we offer so that you can make an informed choice of which to take.

Before you take out your mortgage, we will provide you with a Key Facts Illustration which will give all the details of your proposed mortgage. If your application is received via an intermediary, they will advise you of the most suitable product and provide you with a Key Facts Illustration. The Society does not offer advice and recommendation on any other products available in the market place.

The Society will only accept introduced business from mortgage intermediaries who are authorised by the Financial Services Authority. If you have dealt with the Society through an intermediary we will tell you whether we have paid an introduction fee and how much it is upon your request.

To enable you to compare the overall costs the Annual Percentage Rate (APR) is quoted for each product.

Where Do I Start?

Whether you are looking to set up home for the first time, hoping to move to a larger house, looking to improve your existing house, or even looking for a new lender because you are unhappy with your existing one, you need to establish how much you can borrow, and how much it will cost you every month.

So How Much Can I Borrow?

On the assumption that the property is being purchased as a private dwelling for owner occupation, the basic advance is normally 75% of valuation. Purchasers who have been unable to save the whole difference between the basic advance and the purchase price may obtain higher advances provided additional security is available and they have adequate income. This usually takes one of the following forms:

1. A mortgage on other property (not necessarily owned by the purchaser – e.g. a relative).
2. An endowment policy having sufficient surrender value.
3. Cash deposited with the Society by a third party (e.g. a relative).

If the amount you are borrowing is more than the maximum loan the Society would normally make on the property (i.e. 75% of the property’s valuation or purchase price, whichever is the lower), the Society will take additional security. This in no way affects your liability and promise to repay all monies owed to the Society in full, notwithstanding any claim that might be made by the Society in the event that the property is taken into possession and sold by the Society for less than the amount you owe.

Borrowing Capacity

The maximum amount that can be borrowed on mortgage will be subject to affordability assessed on your monthly net income and expenditure.

The basic maximum mortgage advance is normally* 75% Loan to Value (LTV). For loans over 75% LTV up to a maximum of 90% LTV: additional security will be required; refer to our Mortgage Department for detail.

*except First Time Buyer special terms (i.e. max 90% Loan to Value).

How much deposit will I need?

Unless you are purchasing as a sitting tenant and are therefore paying quite a lot less for your property than its current value, you will find that the Holmesdale Building Society does not consider 100% mortgages.

The most we will lend you - as long as you can afford it of course - is 90% of the lower of the purchase price or valuation and therefore you will need a deposit of at least 10%. Additional security will be required for loans in excess of 75% of the value of the property.

Right to redeem

The borrower(s) may exercise this without prior notice in accordance with the Society's Mortgage Conditions clause 20 subject to clause 5(f) and Rule No 11 and Additional Rule 4 (see below).

Affordability

Whilst you may fit the Society's criteria in respect of the size of mortgage you are considering, when applying for a mortgage you should complete a budget checklist. This will take into account all of your regular outgoings and anticipated purchase/moving costs so that you can be sure that you can afford the mortgage installments. Consideration also needs to be given to any increase in mortgage interest rates.

Redemption Fee (Rule No 11 and Additional Rule 4)

The Society reserves the right to charge up to 3 months' interest on either full or partial redemptions within the first 5 years. This is reduced by one fifth for each complete year that the mortgage has been in force or is waived if a new mortgage is taken out with this Society. Further the value of any discounted rate concession or benefit in lieu of the concession will be recovered, if applicable to the individual account. Redemption interest will not be charged in the event of early repayment of the mortgage for all mortgage offers issued after 26th November 2001 unless specified in your formal Offer of Advance.

Right of sale (Possession)

The Society's power arises from the Mortgage Conditions clauses 13 and 14 and should this action be taken the Society will close the account but without prejudice to any liability under the borrower's Personal Covenant.

Personal covenant

The borrower is personally liable for all sums due to the Society whether or not any security held by the Society is sufficient to meet that liability.

Cases of hardship

The Society will wherever possible give sympathetic consideration in cases of hardship and would encourage borrowers who find themselves in financial difficulty to contact the Society immediately.

Guarantees and Third Party Security

Any person willing to act as Guarantor must be aware that they are equally as liable for the debt as the borrower and that the potential liability is unlimited. Independent Legal advice is strongly recommended before entering into the undertaking to act as a Guarantor.

Data Protection Act 1998

Borrowers have the right of access to their personal details held on our computer files and within manual files, although we may make a reasonable charge for providing this.

Confidentiality

The Society will at all times exercise strict confidentiality regarding your personal details and conduct of your account, except as authorised in the mortgage application form.

Marketing

Please confirm in writing if you do not wish to receive advertising or general material relating to the services the Society or an associated body can provide.

Complaints Procedure

We hope that you are fully satisfied with the service you receive from the Society. However, if you are not, we have a complaints procedure which is designed to help resolve your complaint in a fair and speedy manner.

Making a complaint

You may make a complaint by any reasonable means, for example, by letter, telephone, e-mail or in person. All complaints should be directed to the Chief Executive and confirmed in writing.

We will send a written acknowledgement of your complaint within five working days (working days exclude weekends and bank holidays).

Within four weeks of receiving your complaint, the Society will either send you a final response, or a holding response which will explain:-

• why we are not yet in a position to resolve the complaint, and
• indicate when the Society will make further contact, which will be no later then eight weeks after the complaint was received.

By the end of eight weeks after receiving your complaint, the Society will send you either:-

1. a final response which

• accepts the complaint and, where applicable, offers redress;
• offers redress without accepting the complaint; or
• rejects the complaint and gives reasons for doing so, including information about your right to complain to the Financial Ombudsman Service or;

or

2. a response which

• explains that the Society is still not in a position to make a final response, give reasons for the further delay and
• indicates when the Society expects to be able to provide a final response, and
• informs the complainant that he/she may refer the complaint to the Financial Ombudsman Service if he/she is dissatisfied with the delay, and encloses a copy of the Financial Ombudsman Service's explanatory leaflet relating to complaints.

If you decide to pursue your complaint through the Financial Ombudsman Service you must do so within six months of the date of the final response.

Further information relating to the current Financial Ombudsman Service complaints scheme is available from this Society or direct from the

Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
London
E14 9SR

Telephone number: 0845 080 1800
E-mail: enquiries@financial-ombudsman.org.uk
Website: www.financial-ombudsman.org.uk.

Charges

These may be made in connection with the operation of your mortgage account, some examples are as follows:-

We shall be pleased to provide details of current charges on request.

Interest Calculation

The Society charges interest from the day money is released for the mortgage completion. Thereafter interest is charged on an annual rest as at the 1st April on the capital balance then outstanding. In respect of additional loans, interest is adjusted from the day of the transaction. Interest on capital repayments is adjusted from the day of receipt subject to any redemption interest that may apply.