first time buyer's mortgage

anna01

Hi there,

I wondered if anyone knows whether benefits which are attached to wages (i.e working tax credit) are taken into account by any/many of the mortgage lenders?

I would've thought that although they might fluctuate slightly and current political chat makes it likely cuts will be made - tax credits are as guaranteed as jobs are, so taking them into account would be plausible. Or am I completely of the mark here?

Any help would be appreciated as I have my eye on a house for the same monthly price as my rent is now but don't want to be laughed out of the bank.

Thanks

pinkshoes

I wasn't aware that they took benefits into consideration.

What's your annual salary (before tax)? What size deposit do you have? How much is this house? Is it just you buying on your own?

anna01

That's what i thought.

I've split with my boyfriend, went into renting and had to apply for tax credits as i only work p/t which means I can pay my rent ok.

I've been quoted a mortgage price (on a basic general calculation) only £10 pm more than my current rent and was chatting to a colleague in a similar position who had to fight but did get her benefits taken into consideration. Unfortunately that mortgage broker passed away and with the climate how it is now, I'm not holding my breath.

The house is dirt cheap for current prices and I have the deposit, can afford the mortgage payments but as my money partly comes from tax credit, probably won't get the mortgage.

Bufger

is there not an option of going into full time employment? what percentage of your income does the tax credits make up?

anna01

I left full time employment to go back to uni & also have 2 children so I'm officially a single mum, full-time student and work 12 hr shifts sat & sun. I'm just going into my 3rd year but would need to study longer to practice in the profession so no guarantee (as much as can be) of full time work after anyway.

It just seems a waste to be paying the same price in rent as the mortgage for an identical property to the one I've seen. I think lenders like you to be in your current job for a while anyway before they'll consider lending to you.

anna01

Hi again

Just spoke to a friend who seems to think my bank might be more lenient regarding where my money comes from as long as I've not got debts etc with them (which i haven't).
Does anyone have any idea if there are strict guidelines that ignore tax credits etc or is it likely to be at lenders discretion?

Thanks

Bufger

To be completely honest im not too sure on the tax credits situation. Usually the general rule is you cant buy on benefits but there could be different rules for different situations.

I would advise that you think seriously about this though as your life at the moment isnt a clear path. Its a big responsibility and so is being at university and having 2 children. Can you really take all of this on at once? Would you rather tackle 1 at a time? If the chances of you getting a full time job after your degree are unknown then having a mortgage looming over your head isnt a good idea.

anna01

I see what you're saying but I've been a single mum for a long time so am not at all daunted by that prospect.
I could go back to full time work in my current role - I just changed and reduced my hours to concentrate on studying. It'd just not be anything to do with the subject I'm doing at uni.

I've never been very good at letting an opportunity pass me by especially when it's at a reduced price which would never be seen again. The way I see it is that going full time again would boost my finances but if I can get the mortgage in my current situation it would mean I have a house and the security which goes with that and anything above is a bonus.

Bufger

did i read that you're in your last year of uni? property prices take a while to rise but fall rapidly. There are predictions that they will fall again this winter and then begin to rise next summer. If you're in your last year of uni you wont have missed the boat at all so try not to consider it so much as a race.

How much deposit do you have towards your target? (if you have set one). If your deposit is small it will be just as beneficial to work on that and finish your studies and then be in a better position once you have got rid of one commitment.

sacred_2

Yes, Tax credits are taken into consideration with the majority of lenders, i had my mortgage approved with Natwest with them