FTB - Help and advice please!

rhionm

Me and my partner are looking to get on the property ladder soon. We have just seen a house that is Sold STC but have heard that the people buying are going to pull out. We would be very interested in this house but if the house did come back on the market in the next few weeks (or if another suitable property did) would it be better to be seen a IFA now so we have everything in place or do we do this after putting in an offer?

We are looking for houses around the £125,000 mark (avoiding Stamp duty if poss) and we have a 10% deposit. Neither of us have any debt, im on £20895 and she's on £9000 (with pay rise due in Sept/Oct 06).

Would we have a good chance of getting a decent mortgage with these figures?

Thanks a lot people

Omertron

It would be worth going to see an IFA, if only to understand what your maximum price would be and what your re-payment options are. You can always then get a AIP (Agreement in principal) that will allow you to sound more serious when putting an offer in as it can sometimes take a week or two for mortgages to get organised.

I don't know what the current working out is for joint mortgages, ours was 3.5 times the larger salary plus the other, so in your case about £82k, but your IFA would be able to find the deal for you.

Good luck

Heth_2

I'd go and see an independent mortgage advisor, or talk to your bank, just to get some ideas about how much they will lend you. Make sure the service is free, all you really loose then is some time!
I would say you are being a bit optimistic with what you want to borrow (and are you sure you can afford the repayments?). When my husband and I started looking at houses we had a 10% deposit, he was on 21k and me 12k and we were still limited by being able to borrow just over 100k (my husband has a fairly small car loan, so that did affect us, but possibly as much as the difference you would need).

Have you also got money saved for all the house buying costs? Not that mortgage advisors care about that, but it's good to put in your 'what can your afford' thoughts.

rhionm

Yes we both have enough to pay a 10% deposit (say around the £12,500 mark) and have around £2000 each then to cover legal cost and any other costs.

We have made a spreadsheet of the likely costs involved with keeping a house i.e. utilities, food, insurance, mortgage payments, phone, tv licence etc and we both could afford this with some money spare at the end.

Think ill have to go and talk to an adviser as soon as then!!

lightspeed

Try Alliance & Leicester and Nationwide. Both these work on affordability and off the top of my head should be able to lend what you are asking. As for repayments, i would expect them to be around £630 per month on a repayment mortgage or £430 on interest only (these are at 4.59% fixed).

We are in a similar position to yourselves (wanting to borrow that bit more to secure a home for the long term future instead of one we will want to move out of in a couple of years) in that we earn approx 40K between us and are borrowing 138K (3.45 times joint income). According to our spreadsheet this is do-able leaving us with what i think us more than enough disposable income between the 2 of us.

The main thing that you must consider is that if IR's increase, e.g. double,will you be able to afford the payments? The fact is that if IR's do increase by that much you wont be the only one finding yourself a bit short, however, it is important to understand potential future happenings when borrowing any amount of money, particulary an amount of that size.