Wanna buy my first house,but dont know where to start

MortgageMamma

I would be happy to assist as would andy, but I'm afraid I could not advise unless client took advice on lending limits.

alirob12

thanks loads for all the comments, we are going to pay off the outstanding balances on the CC, and I guess we can stretch and have 20000£ for the deposit, is there a chance we can get a mortgage for additional 95000£- 100000£? As I said I will be changing a job for something with a minimum of 1,400£/month and my girlfriend is also considering a career change. Additionally I have recently started my own business (there is not big monye in it yet but I already make additional 200£ profit) I am hoping that this business within a couple of years will be my main income and within a few month I will acquire a newish car (1 year old worth about 6000£) which will be my own, however the company I do business with will make all the lease payments., as a result of which I will have a car for which I dont pay, can this improve my credit rating? and would it help in obtaining a mortgage of about 100000?
thanks guys!!

Phil_rich

If you go and see an independant mortgage adviser they will be able to tell you what you can get, i earn £18000 + £3400 bonus + £4000 overtime and i have been offered a mortgage of £126,000.

So there is hope for you, you need to seek professional advice though, and look for a mortgage adviser who is free of charge.

Phil

jo_b_2

alirob12 wrote:

we owe about 8000£ on credit cards but also have about 17000 in high interest account

It might not be what you want to hear, but I would suggest using your savings to pay off your credit cards before you think about buying a house.

Arch-Angel

AndrewSmith wrote:

Not true,

Regardless of the size of the deposit, lenders will still have criteria that you will have to meet. Be this either by income multiples or by affordability.

Every lender will have it's own criteria to apply, if you don't fit it, you don't get the mortgage.

It is not simply a case of proving you can afford to make the payments.

But would it be accurate to say that a lender would look more favourably on a borrower with a higher deposit but a questionable financial history? Or is it irrelevant - the financial history would be the deciding factor for a lender to say "yes", with the deposit only influencing the (fixed) interest rate.

This was a recent "debate" in work - the more the deposit, the better the "questionable" person's chances of getting a mortgage...

AndrewSmith

Arch-Angel wrote:

But would it be accurate to say that a lender would look more favourably on a borrower with a higher deposit but a questionable financial history? Or is it irrelevant - the financial history would be the deciding factor for a lender to say "yes", with the deposit only influencing the (fixed) interest rate.

This was a recent "debate" in work - the more the deposit, the better the "questionable" person's chances of getting a mortgage...

It will vary from lender to lender so I will give a very generic answer. Before the bashers jump in with their individual contradictory tales please note that I am saying this is a General Statement.

The answer is that they are both an over-riding factor as to what exact mortgage product you will get.

A Mainstream full status lender will look first at credit history and income as the main criteria for deciding if they will lend. The size of deposit will affect only the product selection available. There are however some lenders who will offer slightly higher income multiples on a sliding scale for larger deposits. It is marginal though in most cases.

A sub-prime or non-conforming lender will generally be more concerned with deposit size when deciding to lend, using the credit history purely to determine the product type and rate.

In short, the answer is yes and no. This does highlight the fact that no two cases are the same.

AndrewSmith

Phil_rich wrote:

If you go and see an independant mortgage adviser they will be able to tell you what you can get, i earn £18000 + £3400 bonus + £4000 overtime and i have been offered a mortgage of £126,000.

So there is hope for you, you need to seek professional advice though, and look for a mortgage adviser who is free of charge.

Phil

The difference is that you are 'salaried' on an employment contract. Plus you get higher multiples for single income than you do for joint.

Arch-Angel

AndrewSmith wrote:

It will vary from lender to lender so I will give a very generic answer. Before the bashers jump in with their individual contradictory tales please note that I am saying this is a General Statement.

The answer is that they are both an over-riding factor as to what exact mortgage product you will get.

A Mainstream full status lender will look first at credit history and income as the main criteria for deciding if they will lend. The size of deposit will affect only the product selection available. There are however some lenders who will offer slightly higher income multiples on a sliding scale for larger deposits. It is marginal though in most cases.

A sub-prime or non-conforming lender will generally be more concerned with deposit size when deciding to lend, using the credit history purely to determine the product type and rate.

In short, the answer is yes and no. This does highlight the fact that no two cases are the same.

No bashing here - thanks!

As a follow-up though is there any generic description for the level of adverse credit that mainstream lenders are content with? I suspect not - as you've already pointed out "no two cases are the same" Is the case of one default on file = sub-prime lender only? Or do some lenders look at the whole picture (i.e. past problems but recent credit history (2-3 years) is fine)?

Hoping to win my workplace argument!!:D

AndrewSmith

Arch-Angel wrote:

No bashing here - thanks!

As a follow-up though is there any generic description for the level of adverse credit that mainstream lenders are content with? I suspect not - as you've already pointed out "no two cases are the same" Is the case of one default on file = sub-prime lender only? Or do some lenders look at the whole picture (i.e. past problems but recent credit history (2-3 years) is fine)?

Hoping to win my workplace argument!!:D

God I love questions like this

It depends on the severity of the Adverse credit, when it was, is it satisfied, what was it for:

Eg

£15,000 CCJ non payment of a loan issued 6 months ago unsatisfied, then yes, definately not high street.

£350 CCJ unpaid water bill 4 years ago satisfied 1 year after it was lodged, then I would expect this to go high street without much problem at all.

Interesting point: Defaults are more likely to stop you going High Street than CCJ's.

A CCJ is merely where a County Court Magistrate Judges that you owe another person money. It doesn't necessarily indicate delinquency on a credit agreement.

A default on the other hand is issued where delinquency has occured and the terms of a credit agreement have been broken by continued non payment.

Andy

regularsaver1

do you mean £1400 after tax per month - as £15k before does not equate to £1400 take home

you sound very vague that you are going to change your employment - is it that easy?

what do you mean by that you both earn £800 each but thats spening money - what happens to other commitments?