Mortgage advice - should we even bother?

skattykatty

Any advice/thoughts will be gratefully mulled over! Husband and I would like to buy a place in the next year. He's self-employed but is completing first year of accounts now. I've got a part-time job, but am looking to get another part-time job to augment earnings. Between us I understand it will look like we won't be able to make it BUT we've been renting for 3 years and have never had a problem paying all our bills. We are lucky that family can give us a deposit of up to £35000 and I don't think we would look at any property over £175000. Does that sound reasonable?

Do we have a hope in getting a mortgage? We know that,in time, we will be earning more between us but also know that we will be able to cope with mortgage repayments up to £750 a month. We know we are reliable and we certainly don't want to bite off more than we can chew, and in this climate we wouldn't be able to anyway. Should we even bother? If so, who can we approach?

grogdog

it all will depend on your husbands accounts and your salary along with any other outgoings you have, but 140k over 30 years repayment will cost about 850pm @6%

_Andy_

What is his net profit for the year and what's your gross annual salary?

Do either of you have any adverse credit?

skattykatty

Thanks for giving an idea about repayments. So £120000 over 30 years repayments????

I only earn £9050 and I don't think his first years accounts will add up to much (I was supporting us on a much higher salary at the time). I think he said not more than £12000. I've been scrupulous with money over the years! I've had a student loan, which I paid off years ago and have a credit card (which I've only recently acquired). However, my husband became bankrupt over 3 years ago. Since then, and since we've been together, we haven't had any major problems. We've never lived beyond our means. Now that I've written it all down, it sounds like a lost cause..sigh...

Anyway, I know that he's been steadily been earning more each year since becoming self-employed, even if, as yet, this won't be official!

_Andy_

The amount you're wanting to borrow in relation to your income isn't going to be possible.

skattykatty

hmmm..yeah..thought so. Is there NO WAY? I mean the fact that we have ALWAYS paid up everything? Just find it really upsetting. We are not going for anything we know we can't handle. :mad: Frustrated but not surprised. Would even self-certified mortgage be out of the question? What if we had a guarantor? A friend of mine got a £200000 mortgage with an income of £25000...So, no hope then?

_Andy_

Well if you want to lie about your income and commit mortgage fraud, go right ahead.

skattykatty

Well no...Been cautious has cost me a stab at owning my own home...fifteen years of renting other people's property does pale...:(

milliemonster

Your combined income will be around £20k, with a deposit of £35k on top of this you should be looking at houses around the £100k mark, at least it would be a step onto the ladder for you.

The fact your husband went bankrupt 3 years ago will hinder you getting a mortgage though, expect to have to go sub prime and pay much higher interest rate

skattykatty

Thanks mm for your constructive comments. SO don't understand money stuff so have to ask: what's sub prime? We know that we'd prob have to pay more interest. Will bankruptcy ever NOT be an issue? It's been 3.5 years!

As I will, hopefully, be getting another job at some point and my husband will, hopefully, make more contacts in order to secure more work, we should probably wait for another year before trying to get anything. And yeah, we don't even dare to look at a house over £150000!!! BUT we have to also be realistic in terms of space. He works from home and there's no point buying a house for the sake of owning one if it means he doesn't have room to do his job.

All food for thought. Thanks again

Northants_Simon

I don't want to sound nasty. But really, you shouldn't be considering buying at the moment.

I'm self employed and had to submit 3 years audited accounts to the bank, plus a letter from HMRC confirming my income. I also had to provide 3 months business account statements. The bank then lent me 3.3x income on a squeaky clean credit history.

I'd suggest you wait until you can afford a house on 3.5x income and have 3 years accounts from your husband's business. I don't mean to be harsh, but I don't think it would be a good idea to buy a house in your present circumstances. I don't think many banks will lend at present on just one years accounts.