Financial advice for first time buyer

sudi

Please could someone give me some advice for my daughter. She is 21 years old and wants to apply for a mortgage with her partner who is 23.

They have a combined income of £35,000 (£18,000 my daughter) and the house they are thinking of buying is £123,000 and they have a suitable deposit.

My question is this:-

• My daughter took out a loan £177/month, of which I pay £100 towards it, in Dec 06 for 48 months to buy a car with no missed payments.
• She also has a credit card with a balance of £900 and has 1 late payment due to bank direct debit/date error.

Do you think she would qualify for a loan as she is only 21 and has the above commitments? She is about to go and see a financial advisor with her partner and is worried she will be turned down. Does anyone have any advice to offer?

Many thanks
Diana

_Andy_

Sums look do-able. You haven't stated the percentage of the deposit so impossible to state if the missed CC payment will be an issue.
In terms of the credit commitments these won't be a problem

nw_man

Her age should be of no relevance.

Her commitments will be taken into account when any lender calculates what they are willing to lend. In fact, having commitments and showing lenders that the are repaid on time and in the correct manner will go in her favour.

The late payment may be a concern to some lenders.

sudi

Thank you. I think they have 10% mortgage. How do they work out mortgages these days, do both incomes get taken into considereation of just the mans income?

_Andy_

Both incomes.

Idiophreak

sudi wrote: »

bank direct debit/date error.

You mean it was the bank's mistake? If so she should push to get this removed from her credit file ASAP

sudi

Thanks Andy. With your knowledge who would you say is offering the best deals for first time buyers. Her partner works for HSBC.

StuTheDon

Hi - where is the deposit coming from? I ask because there are so many examples on these forums of people splitting up and there being real issues with who pays what etc.

It may be worth pointing out to your daughter that if they split up, and are both on the mortgage, that the bank can come after either of them for the whole amount. So if her partner stops paying she is liable for the lot potentially.

Sorry for the doom and gloom - just want to make sure you consider all aspects.

sudi

I am not sure as they both have savings but I will show her your response! Her main area of concern at this point in time is that she will not be able to get a mortgage.

Thanks

daily_2

Pay off the credit card (and maybe the loan) with the savings first. Buying and running a house is hard enough, without having debt before you start.

_Andy_

sudi wrote: »

Thanks Andy. With your knowledge who would you say is offering the best deals for first time buyers. Her partner works for HSBC.

Her partner would get a small mortgage subsidy from HSBC but it won't affect the rates etc.
Plus whilst the base rate is low the subsidy is pretty minimal.
They would be best off speaking to a broker.