mortgage for 78000 possible on 16500 wage?

DM1786

hi i am looking for some advise/help on getting a mortgage. i have been looking to buy a property from a family member, the property is valued at 86000, but would be sold to me for 78000 providing i can get a mortgage. my current wage is 16,500 i have no deposit saved. however, i could afford the legal fees. i am 22, am a FTB no loans or monthly outgoings etc; would it be possible to get a mortgage and if so any help on where to find it? thanks

Staciep88

Hiya, well all I can say is to go on a mortgage website and get a quote. What I did was got in touch with a broker (one who didnt charge fees) and he sorted it all out for me. The broker makes there money from the mortgage company - unfortunatly it all fell through but never less the man was really helpful

[Deleted User]

So, you want to get a mortgage for over 4.5x your income, with no deposit.. ? Might be a bit tricky - you need to call a broker

sdooley

The problem is not so much your income as that no lenders have 100% mortgages anymore (and they look at the actual price not just the valuation). Could you even scrape together a £4000 (5%) deposit?

Alternatively would the family member rent the property to you until you can afford to buy? They may not need to go onto a buy to let mortgage as you are family.

riad_2

For the amount you're looking for borrow, you're looking for near a 5x income multiple, which is quite tight in this climate, but it is possible so I'm sure a broker will be able to source something for you.

The real problem lies with that you haven't got a deposit. I'm sure the mortgage advisers can advise better on this, but from what I understand no-one is really lending 100% mortgages anymore.

If you can scrape together a 5% (apprx. 4000) deposit, perhaps get a deal with free legal fees (so u can put the money u had intended to pay the legal fees toward the deposit), that will really help you.

This will also help u with ur income multiples for the mortgage as borrowing 74k (after the 4k deposit) is 4.5x your income... which I expect a lot more lenders would go for than previous 5x.

I think the First Direct mortgages are completely fee free at the moment, but afaik their income multiples are quite low. I think Woolwich will lend up to 5x, but there are some fees. I would strongly recommend speaking to a mortgage adviser who will be able to better advise you which lenders will approve you and the various fees involved.

DM1786

on the halifax website using the mortgage calculator it said i would be able to borrow up to 78000, is this an accurate calculation or would it be lower when i actually went along with it?

sdooley

DM1786 wrote: »

on the halifax website using the mortgage calculator it said i would be able to borrow up to 78000, is this an accurate calculation or would it be lower when i actually went along with it?

Might be accurate but as above, you need a real deposit not just a higher valuation. Why does your relly want to sell?

DM1786

wants to sell becaure of other family commitments. using the mortgage calc im pretty sure i said i didnt have a deposite though. i have applied online at halifax for one, if they accept would it still be best going through a mortgage adviser or would it be easy enough going through with it on my own?

beecher

Halifax don't do 100% mortgages as far as I know - LTV has to be at most 95%. Why don't you give them a call to confirm this - waste of time for everyone if you apply online without them realising that you have no deposit. When you applied didn't it say 'up to 95% loan to value' on the mortgage you picked?

edit: just to add, the Halifax calculator won't ask you if you've got a deposit when saying you much they'd let you borrow. They offer different deals dependent on the LTV of the borrower, and you need a deposit to get any of them.

DM1786

yes but i thought if it was 95% LTV and the property was worth 85 and i was paying 78, then i would be ok?

beecher

DM1786 wrote: »

yes but i thought if it was 95% LTV and the property was worth 85 and i was paying 78, then i would be ok?

No that's not the way it works - you need a mortgage of 95% of the price you're paying. You need at least a 5% deposit.

edit again!: is this one of those 'vendor pays the deposit' schemes? I dont' understand them so maybe someone else will be along who can help - you need to make sure that you're basing your calculations on what the bank will value the flat at, rather than the Estate Agent though.

BTW, a £78,000 mortgage would cost you £545/month at 6.89% over 25 years. Is that a wise debt to take on with your wage?