£91500 mortgage

mikeandrach_2

i know al about the credit crunch and housing price crash etc, and have been adamant to rent and wait for the drop. but, we have just seen a house that would be suitable for us for years, in a village we both really like for £91500. its a newbuild which i don't think has been lived in. my question is would we be likely to get a mortgage in the current climate. our credit ratings are less than perfect, we could borrow a 5k deposit from a provider such as welcome finance on an unsecured loan. (i know its expensive, but its a short term debt we could repay in full within a year). i am a retail manager earning min 25.5k, ote 37k, and my partner is a teacher on 21k, so the multiple of income would be pretty low. would mainstream lenders be likely to lend to us?

Debt_Free_Chick

Your salaries are fine, but you are unlikely to get a mortgage if you have to borrow a deposit.

And, ideally, you need a 10% deposit

And your credit records won't help

And, for a new build, it's unlikely that the value of the property will come up to £91.5k. That price includes all the brand new fittings, carpets, white goods etc which do not count in the valuation. Essentially, the lender is only interested in the value of the "bricks & mortar".

See what others say, but I think you'll not be successful- sorry

mikeandrach_2

the house is supplied pretty bare so there would be no element of the appliances etc building up the value. also, would a mortgage company worry if the deposit was a loan, especially such a small one? even in the current climate it is really cheap, its mid terraced but an almost identical semi is 40k more, so i think it is still very good value. also at 91.5k i would still try and haggle by a couple of thousand or so which may help. halifax seem to ask for a 5% deposit which isn't too bad

Debt_Free_Chick

Effectively, you are borrowing 100% of the purchase price so many lenders will treat this as an application for a 100% mortgage. In effect, it's no different as you'll have two lots of repayments to make.

You have no savings - and less than perfect credit records. To a lender, this looks as though you can not manage your money and you are likely to be a higher risk.

This is what the credit crunch is about, for housebuyers .... lenders get fussy about how much they lend and to whom.

If the house is "bare" is there no fitted kitchen? If not, how are you going to finance that?