PLEASE recommend me some mortgage advice!

bruffyboy

Hi all,
Basically I am currently renting but have had a pay-rise to £38,500 and am thinking about buying a house in this current market. I have no savings and no way of getting a deposit together other than to take a loan out My questions are:

1) Can I get a 100% mortgage? I can't find a definite answer on this anywhere online!
2) Would it make sense to get a loan as a deposit and then get a mortgage?

I currently pay £600 a month for rent, could go up to £900 tops if needs be, but would rather stay at around £600! Would be looking at buying around £125000-£145000.

I know this is a massive topic but some start-up advice would be massively appreciated

Thanks

_Andy_

1) there are no 100% mortgages
2) No - no lender will accept a personal loan as a deposit so not possible either.

You need to accept this isn't possible at the moment and start saving. On your salary this should be feasible.

dunstonh

1) Can I get a 100% mortgage? I can't find a definite answer on this anywhere online!

no.

2) Would it make sense to get a loan as a deposit and then get a mortgage?

You have no choice. You need a deposit.

With a small rent of £600 and an income of £38,500, how is it that you dont have any savings or cant build up any deposit?

opinions4u

You need a deposit of between 10% and 15% of the purchase price. Get saving, not borrowing.

josievg

Do you have loans or credit cards that you are paying off?

With your salary and rent you should be able to save a 10% deposit in a year to 18 months based on the info you have given so far.

Are there some other essential outgoings you have that are preventing you from saving a deposit?

beecher2

Post a statement of affairs on Debt Free Wannabee for help in budgeting in order to get saving. Shouldn't take you too long.

Mrs_Z

Hi,
I agree with all of the above and don't forget it's not just the deposit you need - you will need to pay for surveys, possibly mortgage application fee, solicitors fees, removals, building insurance, after moving you might want to get new furniture...depending on the property you may want to change the interior, do DIY, believe me, the list is endless!!!

Bigger your deposit = less you have to borrow = better deal = more money in YOUR pocket to spend as you choose...

bruffyboy

Hi all. Thanks for that- just what I needed to know. In answer to some points- we could save if we wanted to, but are currently enjoying the fruits of a good wage and enjoying ourselves (wife has a horse, I collect Tolkien books). We live below our means and finances are fine, I just don't have any inclination to save a deposit for a house- maybe in a year or so. Thanks again.

Thrugelmir

bruffyboy wrote: »

I just don't have any inclination to save a deposit for a house- maybe in a year or so. Thanks again.

Don't bank on the mortgage market getting any easier in that time frame.

bruffyboy

OK well father has just raised an interesting point- if he was to give me the deposit could I pay him back out of the mortgage? Let me give you some numbers to make it make sense:

The house I want to buy is £80,000. It would require another £30,000 to get it up to scratch. If I get a mortgage for £110,000 would the money simply go into my bank for me to spend as I like? so could I give dad his £15000 back as Soon as I had the mortgage?

Also, do you have to show how you will spend the money, or will they simply OK the amount as long as my earnings are acceptable?

Thanks again

dunstonh

if he was to give me the deposit could I pay him back out of the mortgage?

no.

The house I want to buy is £80,000. It would require another £30,000 to get it up to scratch. If I get a mortgage for £110,000 would the money simply go into my bank for me to spend as I like? so could I give dad his £15000 back as Soon as I had the mortgage?

You cannot borrow £110,000 on a house worth £80,000.

If you buy the house worth £80k, your £15k deposit would mean the maximum you could borrow is £65k.

Also, do you have to show how you will spend the money, or will they simply OK the amount as long as my earnings are acceptable?

For a house purchase going to the maximum loan to valuation then they will only lend for the purchase of the house. Nothing else