Mortgage Plus a loan??

charlieh_2

Hi all,

I've been doing a lot of digging but am finding it hard to find any information so need your help. I am a first time buyer with my partner and have a combined salary of nearly 40k, so have fairly good income but have some debts that are decreasing but we really want to get onto the housing market, quicker than they are especially as house prices are low at the moment.

So the question is really can we get a mortgage plus a loan say of 80k for a mortgage with a 20k loan on top to consolidate all debts so they are just in the one mortgage payment for example. We are comfortably paying back the debts at the moment (uni debts mainly on my behalf). We have both been in work for at least 4 years now. Also I have checked my Experion credit report and it comes up as being excellent, rated at 999!

Hopefully you may have some ideas as we want to get on the housing market, we ideally want to buy a home that we can rennovate and then after a few years move on, both our parents are builders so it all makes sense.

Thanks for your time
Charlie

_Andy_

Hi Charlie & welcome to MSE.

In short, no that's not possible.

brit1234

charlieh wrote: »

we really want to get onto the housing market, quicker than they are especially as house prices are low at the moment.

Hi, what makes you think house prices are low at the moment? By traditional trends they are very inflatted still and all the experts predict that they are about to start falling again into 2010, ie the double dip.

charlieh wrote: »

So the question is really can we get a mortgage plus a loan say of 80k for a mortgage with a 20k loan on top to consolidate all debts so they are just in the one mortgage payment for example.

In America they had them they were called altAs, all gone now causing the banks great loses at moment.

ViolaLass

Can we really say it's not possible without knowing first how big a deposit the OP has and what sort of price house they're looking at. (OP - presumably you have a deposit?)

_Andy_

Regardless - it isn't possible.

jassco

ViolaLass wrote: »

Can we really say it's not possible without knowing first how big a deposit the OP has and what sort of price house they're looking at. (OP - presumably you have a deposit?)

If they had a big enough deposit, I'd assume they could clear their debts with it.

charlieh_2

Hi all and thanks a lot for your comments and feedback, really appreciated.

Im glad you have confirmed my original sus!!!!ions. I have been thinking about this all weekend and come up with a good plan I think..

I do already have 2 loans and both are at very good rates, around 6.9% for one and i think around 8 for the other. I got good deals because of being a graduate. One of these ends in a year and a half and the other approx 3 years time.

The latter has around 7.5k left, the first has around 4.5k on it. My plan is to extend my loan which has 4.5k left on it which is with the Halifax to around 13k maximum, clear my other debts off and have them at a good interest rate. Then the outlay for me would be more like £350-£400 per month rather than around £700 per month.

Allowing me to save more for a deposit with my and my partner. At the moment we do have around 2k saved, but want to have between 8-10k as are aiming at a 80-100k max property which we can rennovate, so the property could be even cheaper all depends whats around at the time, we have seen plenty on the market at this price at the moment. The extra im saving each month will of course be saved to increase our deposit so we have that 10%.

Thanks for your info also on the double dip! I've never heard of this - actually this may work out well for me then as it'll allow me to get my deposit together. Realistically I think we would have our deposit quite easily in around 10 months time.

I think this is a good plan of action really, what are all your thoughts? I know it would be best to clear all debts off first but hey, we cant wait forever to get on the property ladder.

Cheers
Charlie

Berkshiregirl

Hi Charlie

Not wanting to burst your balloon - you've got a good plan there for saving money up for a deposit - but the banks will reduce what you can borrow if you have debts. For example, I needed to clear my car loan as a condition of my mortgage offer before they'd give me the funds.

That said if you're looking at £80k houses with a £40k salary you won't be so tight, but it is best to try and reduce your debts if you want to get a 90% mortgage.

Many people on here don't think house prices are going to increase quickly -many are expecting another fall - so you do have time on your side.

TrickyDicky

As a quick rule - always deduct what you have in existing loans from what you have saved when trying to work out what kind of LTV you will have.

So at the moment, with about 12k unsecured debts and 2k in savings, you actually have a negative 10k deposit. You would be much much better off killing these loans as quickly as possible and then start saving for a house.

ViolaLass

jassco wrote: »

If they had a big enough deposit, I'd assume they could clear their debts with it.

Well yes, but I'd also assume that OP would pay off all loans asap before saving for a deposit given interest rates at the mo and also that OP would realise what s/he appears to want is simply a £100k mortgage. I've learned not to assume on this board!

charlieh_2

Hey all,

Thanks a lot for your comments and thoughts again, they have made me think better about this.

Tonight i have applied for a Sainsbury's loan they offer an 8% advertised rate so this would be better than the Halifax's 12% advertised rate. I have gone for a sub 10k loan and this would go to just pay off my credit cards. I am still keeping the 4.5k loan, and have worked out that I can get this completely paid off in only 11 months by just finding another £125 per month plus the money I save from swapping over the cards to the loan. So in 11 months The 4.5 k loan will be gone and ill just have this new loan and may graduate loan left overall leaving me with an extra £300 per month in my pocket to kill off the graduate loan.

I've been realistic about this, and have the spare money each month to pay the halifax debt off.

I just now have my fingers crossed that sainsburys will accept my loan approach, this really is the key to the whole puzzle. My rating is 999 on experion so i just hope they see this and are happy with me. I can see some sort of light at the end of my uni debts tunnel at long last.

Ill post back as soon as i hear anything so fingers crossed.

Charlie