Im a first time buyer? am i suitable

powersellerirl

Hello,
Im looking to get onto the property ladder but I only 21years old. I have a good credit history and a small deposit ready to put down on a house.

Im on a salary of around £26500 and earn another £4-5000 through private work which I do in my days off.
Im concerned because of the credit crunch that I may not be suitable because I have the following

2x Credit cards with around £4500 available credit
1x Natwest student account with £1000 overdraft
1x HPI car for £8000

As I have always paid all my bills in time, do you think that I should first reduce my natwest account overdraft to 0 and ask for my credit card credit limits be reduced or should I just go ahead and apply for a morgage.

Am I am likely candidate to be accepted or is my finiancial status risky at present?

All advice helpful

jenny_13

We need to know more information.

How much is your deposit?
How much are you looking to borrow?

Thanks

powersellerirl

Im looking to borrow around 55,000 with a 5000 deposit

jenny_13

You normally need at least a 10% which is £5500. Have you also got money spare for valuation fees, surveys and solicitors?

LilacPixie

TBH I think you may struggle. You need a minimum of a 10% deposit but the bigger the deposit the better. so 55k mortgage +5k deposit is a 60k property so you would need at least another 1k deposit.

On your 2 card is the availible credit what you could spend or what you have already spent???

Dom3663

When I went to talk to Lloyds they told me I would have to delete the overdraft from my account. I had not money used in the overdraft, but £1500 was available, so I'd imagine you would have to clear it:)

I didn't go through them in the end, but at no point through my current mortgage application process did I get asked if I had a credit card, (I don't think) so I can't see that being a problem [However if that is 4.5k of debt its a different story]

Do you have a good employment history? Ie With a company for a length of time?
Also is your wage 100% fixed? Or is there any commission based in there? That could effect your application

TBH though, if you put up a 10% deposit I can't see you having a problem

powersellerirl

Sorry, the value of the house is £55,000 and Im would be putting down a £5000 deposit.
I have an available balance of £4500 but around £20 is currently used. I'll pay of my card in full every month. I have a full time job for a year now and is not relate to bonus. Its all salary.

So if I cleared my student overdraft, is that a more sensible option.

I have also seen 95% morgages although the rates are higher

Dom3663

The rates on the 90% mortgages are ALOT different to the 85%'s I looked at...the difference to the 95% mortgages are probably just as wide...
You are paying alot for the privelage of a 95% LTV
Also as your mortgage is so close to the value of the house negative equity is a large risk to both you and the bank.

Your also looking at £1/2k for possible arrangements fees, solicitors, surverys.
Personally I think its a little early for you to be getting a mortgage. On the salary your on, are you in a position to save pretty quickly??