Northern Rock Mortgage Calculator

chucky

Dan: wrote: »

Most people buy with their partner/spouse. It has always been the case that a single person wanting to buy would need to have an above average salary.

correct and this basic salary thing is assuming that these buyers ONLY have their deposit and have not benefited from a bonus, inheritance etc...

by the above logic only people on £300k a year will buy a £1m property

twirlypinky

It's so frustrating being single, it really sucks. I'm going to be waiting forever to buy a house, I earn £26k.

I don't think these things should be based on xyz times your salary, it's not a fair calculation. They should base the figure on the amount of money you have left a month after bills that you can afford to pay back on a mortgage. So if I can afford £650pcm on a mortgage, that's £7,800 a year, over 25 years is £195,000 total repayment. If the rates are 6%, they can lend me £130k. Ish. That's a lot more than my salary x 3.5.

Graham_Devon

Dan: wrote: »

Most people buy with their partner/spouse. It has always been the case that a single person wanting to buy would need to have an above average salary.

You are correct.

But try putting the spouses earnings in also. They count for .5 of the mortgage on NR.

baileysbattlebus

Graham_Devon wrote: »

Thing is, average salary is not 35k (I know it was just used for that post). Not in any part of the UK. They say its 27k. Which will bring the 60% down to around 65% drop based totally on the above post.

It's not even 20k in my area (official figures from last year). Its £19,800 roughly.

The median salary where we live (Wokingham Council areas) is £29.3k according to ASHE

mean salary is £34.8k

and you can buy nothing for 3 times median salary.

property is not particularly cheap

baileysbattlebus

twirlypinky wrote: »

It's so frustrating being single, it really sucks. I'm going to be waiting forever to buy a house, I earn £26k.

I don't think these things should be based on xyz times your salary, it's not a fair calculation. They should base the figure on the amount of money you have left a month after bills that you can afford to pay back on a mortgage. So if I can afford £650pcm on a mortgage, that's £7,800 a year, over 25 years is £195,000 total repayment. If the rates are 6%, they can lend me £130k. Ish. That's a lot more than my salary x 3.5.

The Nationwide used to do it like that - I'm not sure if they still - it was called affodability

twirlypinky

baileysbattlebus wrote: »

The Nationwide used to do it like that - I'm not sure if they still - it was called affodability

[twirly scribbles this down on notepad of hope]

Thanks, that's good to know. I really think it makes loads more sense than the other way of doing things. If i was loaning someone that much money I'd want proof they can pay me back more than anything else.

Dan:_4

twirlypinky wrote: »

It's so frustrating being single, it really sucks. I'm going to be waiting forever to buy a house, I earn £26k.

I don't think these things should be based on xyz times your salary, it's not a fair calculation. They should base the figure on the amount of money you have left a month after bills that you can afford to pay back on a mortgage. So if I can afford £650pcm on a mortgage, that's £7,800 a year, over 25 years is £195,000 total repayment. If the rates are 6%, they can lend me £130k. Ish. That's a lot more than my salary x 3.5.

To be honest most now use something called affordability, which works exactly how you describe. NR is very cautious at the moment.

Try Halifax - A quick check on there calculator shows they may lend up to £128,500 on £26K assuming you have no other credit commitments. That’s almost x5.

twirlypinky

Dan: wrote: »

To be honest most now use something called affordability, which works exactly how you describe. NR is very cautious at the moment.

Try Halifax - A quick check on there calculator shows they may lend up to £128,500 on £26K assuming you have no other credit commitments. That’s almost x5.

Thanks, also good to know. I've not been looking that hard at the moment at mortgages on offer because I'm not in a position to do anything yet, but I am pleased that things have changed a bit since I last bought a house.

PasturesNew

A single applicant with no debts and one salary of £15,000 can borrow £43,500.

Two applicants both earning £15k can borrow £84,000.

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Graham_Devon wrote: »

You are correct.

But try putting the spouses earnings in also. They count for .5 of the mortgage on NR.

Glad to see the second persons income used as only .5, when I first bought it was 3.5x single + 1x spouse, or 2.5x joint. Using that calculation, the sh*t didn't really hit the fan with repo's in the early '90's until interest rates were well into double digits.

Yet because of the reckless lending (and borrowing) that has happened, repo's this year are likely to exceed the early '90's, with interest rates at 1% and dropping, go figure, it's not rocket science. I would like to see capping at the historical multiples, it may help stop the sorry mess we are in now, that's set to get worse throughout the coming year.