Very confused about Mortgages/buying a property in general!

laurap83

Hi,

I am looking at buying a property with a friend in the next couple of months and our situation is that I am a first time buyer, and she currently has another mortgage and is renting the property out (she is in the army so is travelling a fair bit). Does this rule out FTB mortgages? (I assume so, but I am just checking!) Our joint income is around £60K and I have been looking at property around the £140K with a 10% deposit.

• Is this a realistic expectation to be able to borrow in the current climate?
• Is the deposit going to be large enough?
• Roughly how much/what are the associated costs with buying a property? (I am such a newb and would ask her from her past experience but she is currently in a desert somewhere and her paperwork is in the UK!)

I have a slightly tainted credit history (the usual late teens/early twenties terrible with money time) slowly the late payments etc are falling off my credit history, but I have found getting a credit card with a good interest rate tough. My parents however are willing to guarantor my half of the mortgage, and my debt is less than £2k

Any help or guidance will be really welcome as I have no idea where to start! But before I start lining up appointments on her return I need some idea of whether we will actually be able to do this!

Thanks
Laura

beecher

There are plenty of guides online whjich tell you about the process.

Why the hurry? If you wait til you've saved up a 15% deposit and cleared your debt you'll be in a stronger position and elilgible for better deals. From what I've read on here, 90% deals are only available for people with spotless credit histories. To me there's no point in diving in now when prices are still falling, when you're able to improve your situation by saving.

laurap83

Ah, the rush (this has been discussed between us for a number of months – hence saving the 10% deposit) is because my friend is back in the UK from March – Augustish, and is then due to be gone for another 6months or so and she wants to be a part of buying/looking for somewhere to buy process (understandably). She has a faultless credit history, and by the time we buy (a few months) my debt will be cleared. As she also has another property with the rent covering the mortgage payment I would’ve thought this would weigh somewhat in our favour. According to Nationwide we can afford to borrow up to £195k (ridiculous if you ask me) with a 15% deposit, but Halifax (who are her current provider) will accept 10%

beecher

Is the existing property on a Buy to Let mortgage as you'll need to sort that out if you're taking on another property.

If your credit history isn't good then I'd say you have a limited chance, and will be paying a high rate if you only have a 10% deposit. But that's just pure guesswork on my part - maybe the best bet is to find a mortgage adviser who can talk you through everything and explain the bits you're unsure of.

Seems to me that the best option would be to postpone buying anywhere until your friend is back in March 2010 and your deposit is bigger and credit file cleaner, but I realise this may not be an option.

Robert_Sterling_3

There is a lot to be said for reading a Which" book, from library, or abut £10 from "Which" called "Buying a House" or something similar.

....................................

CLAPTON

Just a couple of things:

You will have to get a joint mortgage...

So your parents would have to guarantee (if needed) the entire mortgage and not just your share... you wont be owing a share; you will both be jointly and severally responsible for the entire mortgage (as of course will your parents).



once you get a mortgage, you and your friend will be financially linked... so your poor credit history will adversely affect hers.