Am I likely to get any kind of mortgage? Please help.

Lilacblue

Hello

I have been posting elsewhere regarding my situation, but I am hoping that someone out there may be able to answer a question for me.
I have just seperated from my partner (we were together 19 years but never married) and we have two small children. I am really panicking. I need to know what sort of mortgage I may be able to attract (if any). here goes...

Our existing house is worth £250k with a £187k mortgage that is currently interest only as we planned to do all sorts of development to this place and hadn't got it sorted yet. We have been with the same lender since 1995, which I hope is a plus if I go to them but who knows.

There are two scenarios. The first is that I end up with about £30k equity from this property. I earn £20,500 for 24 hours a week and have been employed there for years. I have an extra £5k in ISAs and although I might be able to scrape together some more, that's basically it.

The second scenario is that I have £60k equity, which is less likely but still possible if i can persuade my ex-partner that he owes it to his kids to walk away giving them the best help he can (He earns good money, he could start again from scratch much more easily than me, and would need a much smaller house).

I know there's a lot more to it than this, but what are your initial thoughts? I'm 39 so could handle a 25 year mortgage ok. I am really good with money and have no credit card debts or car loan etc thank god, but I do have childcare to fund, and can't work extra hours.

Thank you.

_Andy_

What kind of property values would you be wanting?

Lilacblue

Hello Andy

Round here I'd need at least £160k but probably more. There are properties for less but not anything you'd want to live in unfortunately.

Thank you.

Lilacblue

Oh, and also my parents might be able to help. When we moved last time they said they could lend us up to £30k to fund a project. They haven't made this offer this time which makes me think they may no longer have it but even though it would be awful I'm not too proud to ask them.

_Andy_

Ok to give you an idea of lending, 4x salary, possibly more, should be achievable.
Make sure when you budget for this you factor in things like legal fees, valuation fee, cost of moving, estate agents fee for the sale of existing house etc.

SandC

Lilac do bear in mind that your childcare costs should be taken care of by child tax credits so do get in touch with them to find out what you are entitled to.

Lilacblue

Thank you both, that's great. I need to get on to the tax credits people and get something sorted I phoned the council tax office this morning and burst into tears. Bet they hadn't expected that! The lasy was so kind it just made me more upset:o. I've been worrying about money all day, and although I know these things take time I need to find out what my 'mortgagability' is (is that even a word? If it isn't, it should be). I also need to know what to tell my lender about my situaton now.

All advice gratefully taken on board. Thanks again.

dimbo61

You also need to look on the CSA website to get an idea of how much you EX should be paying you each month as child support.
15% for one child and 20% for 2 until they are 19 years old
thats net take home pay !
Keep any old payslips
If you go through the courts the equity in the house wont be split 50/50 if he earns more than you ( which he does)
You would get more of the equity maybe 70/75%
At the end of the day you cant afford that big house ( big mortgage )
He cant buy somewhere else while still on the old mortgage and you cant move on with your life.
Many lenders now take into account child support so that will help in getting a new mortgage for a smaller home that is yours.
Good luck and try and keep it friendly for the kids sake.
Much better and cheaper to sort out the finances and child access together rather than pay solictors a fortune in fees

zzzLazyDaisy

Some lenders will also take into account tax credits as income.

But please don't discount renting - if you have an interest only mortgage you are effectively renting from the bank, and you may find private renting is much cheaper. The down side is that you don't have guaranteed long term security.

You may also qualify for shared ownership through a housing association. If you search the forums you will see mixed views about this. All I can say is that from my own experience, my cousin has two children and a lowish income, she couldn;t afford to buy outright and in fact shared ownership was cheaper than renting in her case, and she got security which was a major deal for her.

Caz3121

dimbo61 wrote: »

If you go through the courts the equity in the house wont be split 50/50 if he earns more than you ( which he does)
You would get more of the equity maybe 70/75%

As the OP and ex were not married it is a straight 50/50 (unless he voluntarily decides to give more)

zzzLazyDaisy

Caz3121 wrote: »

As the OP and ex were not married it is a straight 50/50 (unless he voluntarily decides to give more)

Yes, that is correct.

Sadly many people do not realise how few rights and protections the PWC from a cohabiting relationship has, compared to when a marriage breaks down.