Help! Will I be able to get a mortgage anywhere?

Local_Lass

Hi,

I wondered if someone might be able to give me some advice on whether I will be able to get a mortgage given my current situation.

After hubby walked out on my daughter and I, we had to find somewhere private to rent, as we had been in RAF married quarters. This meant we had no equity to split, and so I'm starting from scratch with only a tiny amount of savings. I'm managing to pay my monthly rental comfortably enough, but hate spending so much on rent when I've got nothing to show for it at the end. More distressing is the fact that I've got no guarantee how long we'll be able to stay in our current home, and this is keeping me awake most nights worrying, as we've already had to move once, and I'm terrified of being put in the same situation again.

So, ideally, I'd like to buy us somewhere, so I know we're safe and secure in that home. Some ex-RAF quarters have come on to the market locally at a very good price, and it seems the ideal opportunity to buy our own home. The problem is that my salary is pretty dismal, and so there's no way I'd get a mortgage on that alone. My parents, however, added my name to their house deeds several years ago, before my Dad died, and my Mum is happy for me to borrow against tthe house, as she knows how much our current situation worrys me, and she knows that the mortgage on one of these houses is going to cost around the same as I currently pay in rent, and so she's not concerned about me not being able to make the monthly repayments.

My problem is that I was told that mortgage lenders are unwilling to lend money against property given the current financial climate. Is this the case, or does anyone know of any bank etc who would let me borrow against the house my Mum and I own together? The mortgage on that house was paid off years ago, and it is worth more than the property I would be looking to buy.

I really would appreciate any advice anyone could offer, as I am desperate to get my foot on the property ladder, and buy us a home of our own so we can start to relax and concentrate on the future.

Thanks for reading my long post!!

beecher2

Salary multiples still need to stack up so more detail is needed.

What deposit do you have? what's your salary, and how much is the house?

Local_Lass

Thank for answering my post, I appreciate it.

My salary is a measly £13600 p.a. and this is topped up with around £850 per month in maintenance and tax credits.

I've only got £5000 in savings, but might be able to raise a little more.

The house in question is a 4 bed for only £100k - so you can see why I'm so loathe to let the opportunity pass me by! Going by the current market, the house I'd be borrowing against is worth around £125k, though I haven't had it formally valued.

The numbers don't stack up too great, which is so frustrating, as I'm currently managing to pay around £700 per month for our rental house, plus still manage to save £200 per month as well.

I just so desperately want to get out of the renting rollercoaster.

beecher2

You need at least a 10% deposit plus enough for fees. I don't understand how you can borrow against a house without selling it but someone else will hopefully be along to explain if that is a possibility. Maybe you should go to see a mortgage adviser to see if you have any possibility of buying at all.

maninthestreet

I'm confused - you want to raise a mortage secured on one property in order to be able to be a cash purchaser on a second property? Or is the money raised by the mortgage on the first property plus any deposit you have not going to be enough to buy the second property, and you will need a mortgage on that as well???

Local_Lass

Now I'm confused!!

I doubt very much that I will be able to get a mortgage purely on my income, so I perhaps another way of wording my question is if anyone knows if there is any way I can use my Mum's house (my name on deeds) as security in order to be able to get a mortgage. Does that make my situation any clearer?

Wh05apk

A new mortgage will be based solely on your ability to repay - affordability, security is only (or should be) a secondary consideration, unless you go to a pawnbroker!

Looking at the figures, it may work by remortgaging your mothers property to raise the deposit, or even the full amount (although that might be dificult if you won't be living there) if the lender will take the tax credits and maintenance into account, and presumably your mothers pension income, I would suggest finding a good broker as once they have all the facts it might be one they can run past the underwriters.

Local_Lass

Thank you so much for your advice, I really appreciate it. Now that you've reassured me that it may be within the realms of possibility I'm feeling more confident about approaching a broker without fearing making a total fool of myself!!

TrickyDicky

Local_Lass wrote: »

After hubby walked out on my daughter and I, we had to find somewhere private to rent, as we had been in RAF married quarters. This meant we had no equity to split, and so I'm starting from scratch with only a tiny amount of savings. I'm managing to pay my monthly rental comfortably enough, but hate spending so much on rent when I've got nothing to show for it at the end. More distressing is the fact that I've got no guarantee how long we'll be able to stay in our current home, and this is keeping me awake most nights worrying, as we've already had to move once, and I'm terrified of being put in the same situation again.

You have got something to show for it. You werent homeless! Owning is not for everyone.

And you do have a garantee when renting - you usually sign a 6-12 month AST, and the landlord HAS to give you 2 months notice to move out (even if its notice at the end - so you should always have 2 months before you need to find somewhere else.

chocsessential

Could you apply for a shared ownership property on the basis that you need to live near your mum? Could your mum lend you the deposit?

chocsessential

Local_Lass wrote: »

Now I'm confused!!

I doubt very much that I will be able to get a mortgage purely on my income, so I perhaps another way of wording my question is if anyone knows if there is any way I can use my Mum's house (my name on deeds) as security in order to be able to get a mortgage. Does that make my situation any clearer?

Do you mean you want your mum to act as guarantor?