A little help needed on mortgages!

The_Palmist

I think Banks are more interested in the amount of deposit you have compared to what you are earning. Income still plays a vital part but from my recent research, it seems they will lend about 3-4 times the deposit on an income in early twenties.
For every extra 1K you add to your deposit, bank will normally put in 3K.

First and foremost you need to decide on the budget of the new property. Have a few viewings and then see a bank manager [or check online mortgage calculators]. It would give you a very good idea on how much you can borrow.

It might be a good idea to wait and increase your deposit.

If you struggle to borrow as much as you need then it might be worth looking in to the home buy schemes, which are normally for new build properties. This will open up another debate in your head [new build vs old].

You can get a very clear idea of monthly by using so many online tools available.

The_Palmist

To get the best rates, you would need a deposit of 25% or more.

Yorkie1

I'd be a little concerned about the fact that you've not managed to get any more savings together in 14 months, when you've been working for 9 of those months. This isn't a criticism, but a reality check for cashflow issues if and when you do buy.

£10K gives you a £8K deposit plus £2K for fees. The minimum deposit you'll need is probably 10%, thus a house worth £80K. From personal experience, the expenses in the first few months of house ownership can easily stack up. You won't have any savings left to pay for that, nor if the boiler breaks down etc.

I am not an expert in mortgages, but I wonder whether your partner's income will be taken into account if she is only on a temporary contract? I also suspect that banks will be unlikely to lend on the basis of what might happen in the future re her exams / job.

TheBombadillo

Yorkie1 wrote: »

I'd be a little concerned about the fact that you've not managed to get any more savings together in 14 months, when you've been working for 9 of those months. This isn't a criticism, but a reality check for cashflow issues if and when you do buy.

£10K gives you a £8K deposit plus £2K for fees. The minimum deposit you'll need is probably 10%, thus a house worth £80K. From personal experience, the expenses in the first few months of house ownership can easily stack up. You won't have any savings left to pay for that, nor if the boiler breaks down etc.

I am not an expert in mortgages, but I wonder whether your partner's income will be taken into account if she is only on a temporary contract? I also suspect that banks will be unlikely to lend on the basis of what might happen in the future re her exams / job.

Thanks for being very honest! Ok, seems I'm gonna have to save for a while longer, and more prudently. Thanks for all the info guys.

The_Palmist

regarding partner's income, it depends on lender. I was recently having a meeting with one of the advisors and he was happy to consider partner's contract letter [she is starting next month].
I would strongly suggest seeing a bank advisor. After all its what they get paid to do.

funky1471

Me and my partner are just putting in an application for a mortgage, it was accepted in principle. Told him to do the full application on Friday around 5pm, so expect to hear soon. I am starting a new job next week and I provided my new contract, my partner supplied a number of payslips for her proof of income.

The_Palmist

goodluck funky