Advice.. 1st Time Buyer

united_road_68

Afternoon fellow forumists, i could really do with some perls of wisdom from some of the more experienced property owners on hear.

The background:
Im a Graduate of 8mths now looking to buy a house with a sibling. only way to do this is via a 100% morgage as the prospect of raising a deposit is unrealistic.
Circumstance:
I earn 18000 per year , my brother ears approx 23000 inc bonus
we have combined student loans (debt) of 26000.

1st port of call, need to get the biggest morgage that is available?? any hints or advice greatly recieved.
2nd, the property will will end up buying will have two spare bedrooms that will be rented out, they will bring in approx £200 p/m each this will go into paying the morgage with the excess being paid by ourselves.

If 2 rooms are rented out which wont be a problem is it in my best interests to inform the morgage company?, obviously my ability to repay the morgage is enhanced via this extra £400 p/m and wont be reflected in my morgage offer.

realistically i may need to borrow upto £140000.
Any advice on any of the elements i have raised will be fantastic as i have lots of ideas and unanswered wuestion running through my head.

Cheers in advance

ec9wrr

Alliance and Leicester managed to give me 5 times my salary - not sure on joint mortgages.
It is worth noting that as you have just graduated you are therefore on the new Student load repayment system that automatically comes out of your salary each month. Most banks don't seem to take this into consideration when looking at how much to lend you.
If you are getting a 100% mortgage I wouldn't recommend buying a 4 bedroom house when only two mortgage payees will be living in it. I understand that you will rent out two rooms. However it is worth considering that if house prices do suddenly drop in real terms you would end up thousands of pounds worse off than if you had purchased a smaller house for just the two of you. I realise the proportions would be the same it's just quite a bit more of a risk.

united_road_68

any further advice would be great

AndrewSmith

Scottish Widows Bank,

Graduate Mortgage, and will also allow a Guarantor.

Andy

ec9wrr

Let us know what you decide on! good luck!

rchddap1

Remember that you will still need some savings for the following:-

Legal fees
Searches
Stamp duty (depending on the value of the property of course)

and then there's... furniture and/or moving costs.

MORPH3US

If you have a HSBC graduate account (either of you) then they do 100% mortgages fixed at 5.19% which is a very good rate for a 100%.

The best we could find, even mortgage brokers were telling us how good it was and in the process knew that they would lose our custom because they couldn't beat it!

You should get £140,000 off them no probs. Myself and the gf eventually negotiated 145k on 19k each a year with 100 a month each going out on loan payments!

Don't forget that if you rent out 2 rooms, you will be liable for income tax on them but if you rent out only 1 room, you may come under the threshold and not have to pay any tax on it!!!

Also, you might need to think about responsibilities having a paying lodger in terms of health and safety!!!

M