Advice please.

slim06

Good morning, i need some of your wisdom if it is not too much to ask..

I am currently shopping around for a mortgage, but fear i am limited to where i can go. I get £17,000 a year and my wife £13,000 a year, but have outstanding debts. I have 2 cred cards at £900 each, a bank loan of 3,800 and car finance of approx 3,000. With my loan and car finance, i have 2 years left to pay. I pay £120 a month of my loan off, £106 a month off my car, and minimum payments on my cards stand at £20 each, but i try to pay more.
My wife has a credit card balanced at £3,000 with monthly minimum payments of £85 and a loan of £5000 which has 5 years still to run, monthly payments of £150. Also she has a student loan of £1200 outstanding, but she just pays off £20 a month on that. Do we have any hope of finding a mortgage? We have recently got married which is why we have some of this debt, and we were gifted £10,200 from a well off relative as a deposit. Am i better off looking for a 50% ownership house/mortgage, and use some of the deposit money to clear a little? We do not struggle with our payments, and do not miss payments. Also our current monthly rent is £525 a month.

Any help is greatly recieved, Thankyou.

slim06

not a good sign....:o

clearing_out_my_pockets

Personally (and this shouldn't be taken as advice as I'm not a financial advisor) I would use the money to clear debt although I understand this may be tricky if yourrelative exoects if to be used as a deposit. The reason I say this is that lenders will typically deduct a year's worth of payments from your annual salary when deciding how much they are willing to lend you. In your case, they'd probably deduct around £6,000 from your combined salary.

Without wanting to sound rude, you say you "try" to pay more than the minimum payment off your credit card - have you looked at how much your monthly payments might be? Are you currently saving yourselves or would the relative be your only source of a deposit? Sorry for all the questions!

Also (speaking from a personal point of view) I wouldn't consider shared ownership. There are too many unknowns with the rent you'll pay, who you can sell for etc.