Own Home Scheme Pros and Cons

cowgirlmoo

tek-monkey wrote: »

Everyone has the right to buy a house, if they can afford it. I earn £22k and am single, and I am questioning if I can afford one. On £15k there is no way I could get anything I wanted, even without debts and my pension that would mean 15x4.5 (best the co-op will do for a single person) so with a full 40% equity loan that'd be about £105k? Round here thats a 2 bed semi or a 3 bed fixer upper. Not that I'd want to fix it up, as they'd own 40% of any increase in value. So it'd have to be a house I was happy with from the start, which there aint many round here for that price. It would also mean the mortgage/bills/council tax/water/insurance etc. I'd be pushing £800 a month or so, leaving me little to live on. I'd be too scared of the interest rates going up to put myself in that situation.

Its not condescending, its mathmatics. I'd be too close to not affording it to take that risk, especially with rates currently at rock bottom. If someone wants to take that risk though, its their decision. I'd advise not to, but I'm not a financial advisor.

Just to point out - i stated i would be looking for a 60k mortgage (20k Ownhome loan) - your sums are way off. 60k should cost about £400 at most to pay per month - leaves me with £600 for bills and to live on plus my partners income once he gets a job (ofcourse we will not be taking out the mortgage until he has secured a new job.)

pors99

why? are they destroying lives forever?

Seacow_2

punkymunky wrote: »

Hi guys, applied on 5th March and am still waiting, just wondered if there was anybody else in the same boat? Have rung them a couple of times and asked how long the wait is and they've said 8-10 weeks but this is week 15 for us now so getting a bit worried!

I applied on the 19th of Feb, and a mate of mine applied a day later. We haven't heard from them either. My friend phoned them at the beginning of May, he was told that everyone who applied in Feb should receive letters in a couple of weeks, we're still waiting.

katelu

Well, just an update on my "appeal" for my mortgage offer of 56K. Since my mortgage offer I have had a wage increase of 4k per year (putting me at 31k a year) and a windfall due to re-claimed ppi of just under 3k. I have used £500 of it to pay off the store cards and have put £500 away in savings where should I put the other 2k for maximum impact to aid my appeal. My MBNA card is on the highest interest of whats left and at its limit but would it look better to have paid off my lloyds cc in full?

The co-op said that they would adjust my offer following appeal info so I didn't need to restart the process (which is good!)

I have downloaded the fsa budget sheet and the co-ops own mortgate calculator to show ingoings v's outgoing and have a letter from my employer with my wage info. I also have my maintainance agreement from my ex (although who-ever I spoke to at the co-op said it wouldn't count as it hadn't gone through the court although it has been legally signed and dated by a solicitor??) and will include my updated experion report as requested from the co-op as soon as it has been updated. Anything else? Should I include current rental info? Copies of bills?

Thanks in advance for any helpful (none judgemental) advice.;)

superfran_uk

katelu wrote: »

Well, just an update on my "appeal" for my mortgage offer of 56K. Since my mortgage offer I have had a wage increase of 4k per year (putting me at 31k a year) and a windfall due to re-claimed ppi of just under 3k. I have used £500 of it to pay off the store cards and have put £500 away in savings where should I put the other 2k for maximum impact to aid my appeal. My MBNA card is on the highest interest of whats left and at its limit but would it look better to have paid off my lloyds cc in full?

The co-op said that they would adjust my offer following appeal info so I didn't need to restart the process (which is good!)

I have downloaded the fsa budget sheet and the co-ops own mortgate calculator to show ingoings v's outgoing and have a letter from my employer with my wage info. I also have my maintainance agreement from my ex (although who-ever I spoke to at the co-op said it wouldn't count as it hadn't gone through the court although it has been legally signed and dated by a solicitor??) and will include my updated experion report as requested from the co-op as soon as it has been updated. Anything else? Should I include current rental info? Copies of bills?

Thanks in advance for any helpful (none judgemental) advice.;)

Could you possibly use the 2k to pay off the lloyds card, and then do a balance transfer of the other one and any remaining balances to a single 0% card?

Might do to wait a while, you do seem to have a lot of debt (judging by your signature) and it might take a few months for everything to get recorded and fed through to your credit report anyway. I'd say be patient, as too many mortgage applications will decrease your credit score - if you're not happy with the revised offer (assuming there is one - have not heard of anyone appealing before) you might have to re-apply later anyway.

katelu

I am going to be patient and try and hold open the co-ops offer as long as possible so a new search doesn't have to be done. If need be I am prepared to wait as my rented house is fine for now but if I can push it through early even better. If I do have to wait will I need to reapply from the beginning or can I hold on to my Places for People agreement? Also with my wage change will I need to go back to PFP anyway for a new agreement amount (don't want to be accussed of being fraudulent or anything!)

The snowball calculator says I should be debt free by Feb. 2010 (so 8 months) - any ideas on maybe restarting the application for then?

superfran_uk

katelu wrote: »

I am going to be patient and try and hold open the co-ops offer as long as possible so a new search doesn't have to be done. If need be I am prepared to wait as my rented house is fine for now but if I can push it through early even better. If I do have to wait will I need to reapply from the beginning or can I hold on to my Places for People agreement? Also with my wage change will I need to go back to PFP anyway for a new agreement amount (don't want to be accussed of being fraudulent or anything!)

The snowball calculator says I should be debt free by Feb. 2010 (so 8 months) - any ideas on maybe restarting the application for then?

Personally I think you'll be in such a strong position next year, when you've paid off most of your debts, your credit score will be massively improved and with your wage now you could probably get double what you were originally offered for a mortgage. On a month by month basis it will cost you more for of course, but you'll have a much better house in the long run.

This is what I did - I waited for my payrise to take effect (slightly over 5k) and we managed to get a budget of about £16k extra on top of what we had been offered by Moat three weeks previously - I assume the two are roughly similar.

It depends how 'desperate to own' you are. If you CAN wait, I would say do. Personally, I would apply a few months in advance of april (new financial year) so you are pretty much guaranteed the funding will be there, and keep an eye on the house prices.

ladybird3

Superfran is right about the time of year to apply, ownhome get their funding renewed at the beginning of the financial year (April 1st) so assuming the waiting times stay at a similar level then going on the waiting list in jan/feb time is the most sensible option.

I went on the waiting list middle of feb and had my letter about 4 weeks ago, waited 2 weeks for an interview which was exactly a week ago today and 3 days later found a flat, had an offer accepted and am now waiting for the mortgage to go through-all happens very quick when it does happen! Dont spend ages looking around for your deram home, the funding doesnt last forever so just find somewhere that fits your needs at this point in time and go for it. I sacrificed the condition of a property for location, the place I have offered on is in a bit of a sorry state in that it needs totally decorating, carpeting, new bathrm and new kitchen. But it is livable and nothing a bit of paint and some ikea love wont sort out!

My mortgage application has been refferred although im told by the co-op not to worry as it happens to 50% of all applications at the moment due to the economic climate. They also said that sometimes they may have to ask you to take the mortgage out over a longer term rather than the standard 25 years if they think you're a bit of a risk but they try to find ways to offer you the mortgage-it's in just as much their best interests at the end of the day!

Katelu if you think you'll be debt free by 2010 feb then go on the waiting list then-by the time your appointment comes around there should have been a few months to get your credit score sorted. Worth remembering that if you have any credit cards or store cards that have nothing on them or you dont use them then close those accounts down. It does affect your credit score negatively if you have a ton of cards and accounts open even if they have nothing on them. Lenders want to see that you're responsible and good at managing your money rather than leaving behind a trail of financial carnage!

katelu

Luckily although I have a lot of cards/credit, I have never been in areears etc and so other than having a lot of credit my credit history is good (2 searches in the last year including the co-op, no late payments, no defaults etc). That means that other than closing accounts and paying money off etc there is little else I need to do to improve my credit score.

Also for those interested, I applied at the beginning of Jan and had my interview mid May so I will do the same next year (if I need to go down that route)

Oh and ps. My mortgage was refered and I was told I had nothing to worry about etc etc and they offered me 56K thereby not refusing me a mortgage but disqualifying me from the whole process as PFP said I needed to take out at least 78k worth of mortgage. So good luck ladybird,hope your all goes smoothly.

ladybird3

oooh you've got me worried now! they gave me an agreement in principle of £115k but now only need to borrow £104k
as far as i know i have a clean credit history in that i dont have any defaults, have 1 card which is paid off monthly and am only a tiny bit into my overdraft, had a couple of late payments over the years but only 1 or 2 days late
my only debt is a loan which i took out a while ago and always make the monthly payments, other than that i dont even have a student loan so im not sure why my application has been reffered my job isnt at risk and there is a definate progression of salary over the next few years so am worried and confused about it

guess will just have to wait and see