I am a mortgage wannabe (plus maternity question)

The_Big_Seedy_Bun

Evening moneysavers.

I'll cut to the chase and hopefully an eager number cruncher can help.

Missus and I want to buy a house. We are both in our early 30s and have a four month old baby.

Our financial circumstances are as follows:

I earn 32800 per year.
I owe about £3000 on my student loan. £130 comes out each month.

My wife is is on maternity leave until April 2010. She is on full pay until October on a salary of £26000. She gets half pay til December. Statutory til January. Then nothing til April.

She will then go back 2 days a week to a promotion on £17500 a year.

She has no debts.

As far as we know we have no bad credit and have about £58,000 in savings. I would anticipate using about £45,000 of this for a mortgage and associated fees and saving the rest as a backup in case the worst happens.

We are currently paying £1100 per month on rent. I think this will be a stretch when my wifes salary reduces - especially with child care.

My work is in West London so sadly nowhere commutable near anywhere cheap. Even if we go out as far as Horsham its slim pickings for a 3 bed mid terrace for less than £250,000.

What are our chances for a mortgage? Ive been on the internet sites and the rates of interest for less than 25% deposit seem very high on a fix. Doable on a tracker, but I'm mindful rates only have one way to go.

We'll of course make some proper applications but I'm hoping someone can give me an idea of what we may have to work with.

Many thanks all.

g_attrill

Reigate/Redhill have some cheap stuff, also out Aldershot, Farnborough etc. there are semis around that price (commute is ~40 mins by train to Waterloo). Woking too, but I think only the rougher areas are that price.

On mortgages - you will be lent around £145k on your salary alone, however I'm not sure what would happen with your wife's situation. It's possible that they will lend based on her existing salary but obviously you need to actually be able to afford the mortgage!

The fixed rates are indeed relatively high. It's either the lenders thinking the rates might go much higher, or they are upping their rates to replenish their funds. My decision is to get a tracker and hopefully overpay, then remortgage in a few years when lending is easier, hopefully the rates haven't shot up, but it's all a gamble.