Getting on the property ladder with existing debt!!!

superdudeoneill

Hi,

I need your help! I am 25 and still live at home with my parents, I really want to buy a property, but don't know if i'd be able to get a mortgage. Living away as a student, going travelling for a year and generally living way beyond my means for years, has resulted in me being about 10k of debt (not including student loan).

my salary is £17500 and although I have a lot of debt, it is alleither 0% (at the moment) or a low rate of interest. Me and my friend are hoping to buy a house sometime next year. He earns the same as me and has about the same amount of debt.

We both pay the minumum payment or more each month.

What are the chances of us being able to get a mortgage? Ideally we would like one that would consolidate our existing debt and attach it to the mortgage.

I think that my parents would probably borrow us money for the deposit, or even be guarrantor, but I really do not want to have to tell them about my debt. How can I get round this?

Please Help!!! I feel like i'm going to be living at home forever!

southernscouser

Hi dude and welcome to MSE.

Firstly I would be wary of securing your debt on to a mortgage! At the moment if you can't pay it you will get defaults etc. Should it be on your mortgage if you couldn't be your risk losing your home!

Secondly is there anyway you can pay it all or most of it off before you get the mortgage. £10,000 isn't a massive ammount (compared to what I owe anyway ).

Have a look at this thread then post back here with all the info and we will see how we can help you.

http://forums.moneysavingexpert.com/showthread.html?t=107280

Old_iron_balls

Your story is similar to mine.
Im 26 and want to buy a property with my partner ASAP.
However im in debt. Ive decided to clear all my debts before even looking for a mortgage.

If your not being 'thrown' out of your parents house why not work on clearing your debts so you can start a fresh rather than have skeletons hiding in the cupboard.

tomstickland

Get a grip on clearing the debt before thinking about houses.

johannamse

You will never never be in a better position to pay off your debts than now. I bet your outgoings are really low. If you don't learn the lesson now, you will be posting back here in 3 years time, with a huge mortgage and 30k on credit cards, going my girlfriend wants to get married, but I dont want to tell her about the debt.

I dont want to sound patronising, but listen to the lessons people have learnt all around the debt free wannabe board. Also, look at peoples outgoings who dont live with their parents. If you really put your mind to it, you could be debt free in a year, on your wage and living at home. You could then have another year saving for a deposit, and you will go into buy ing your first house with your eyes WIDE OPEN, telling your friend about all the bills you will have to pay, and how to change your gas/electric.

Post your current EXACT income and outgoings (I don't want "going out about 200 " and we will (happily) tell you where you are going right and wrong.

I dont care if I sound harsh. Debt is a VERY dangerous thing and if we can change your mind then fantastic. You have a real chance to change your whole future NOW. Please take it.

cath-w

I would also be wary about purchasing a house with someone who is also in debt. What happens if they cannot afford their part of the mortgage payments? If they default often enough could this result in you losing the house?

C.

Jen_Jen_5

dont buy the house until you are debt free, if you dont work to clear this you will see debt as acceptable and get more debt eg. need a new sofa, need a new bathroom, need plates, need etc etc etc

if you clear it now and save for deposit and furniture and fittings you should be able to manage for most of your life without debt, if you buy a house with 10k of debt, it will become 20k and then 30k bad news

dinkylou

Superdudeoneill,

I completely understand how you feel, I had to move out of home as was feeling like you do now. BUT and this is a big BUT, realistically, you cant afford to do it.

I bought a house 2 years ago with an amount of debt and its very very hard.

The costs are hard enough on their own without worrying about existing debts (and I earn more than you at present)

OK, so you said that you pay the minimum on your debts or more if you can, can you afford to pay back more? If the answer is no, then you definitely cant afford to buy.

So here is my challenge to you, which should hopefully help you get a better idea.

Work out the cost of a small mortgage between 2 people, not including your debts (I estimate approx £300 each) then add in £50 for council tax, £50 bills and £100 for food (this is each not between you and these are rough estimates)

Then try for a month to pay this extra towards your debts. If you cant afford this then you'll not be able to afford to buy and live (which is the most important thing) at this time.

Your debt wont just disappear by adding it to a mortgage, it ll cost you more in interest (which you are nt paying at the moment)

Honestly, I know it drives you mad sometimes living at home but stick it out as buying is not the answer to your problems, only the start of new ones!!!