First time buyer, need a mortgage - no deposit!

Flyboy152

hoggums wrote: »

no deposit = no mortgage. End of.

Start saving.

That's not quite true.

Jo_2k

Hi, I'll try and be constructive with my comments (unlike some!)

From my experience (which I don't have much of) but I have done a lot of research, if you really are serious about getting a mortgage without a deposit then the only way to do it really is with a shared ownership scheme. There are a lot of new builds in my area where you basically don't need a deposit as you are only taking a mortgage for approx 70% of the property, this means that a company/builders would own 30% of the house and they give you the option of paying off that 30% after say 10 yrs. Obviously, it's not ideal but might be worth considering. Don't forget though that you would need to save for the 10 yrs to pay off the builder. Also there would be solicitors fees, removal costs and furnishing costs (if you are in a funished rental property).

I do agree with some of the other posts though as I feel on a £30k salary and only renting, you should be able to save some money per month. I have a mortgage which costs £700 per month and am only on £27k but still manage to save approx £300 p/m so unless your rent is extortionate, it would be worth looking at your outgoings and trying to tighten your belt.

Hope this helps and good luck

TimBear

My salary is £16.5k, but with commission I come out with around £22k (ish!) before tax.

I rent a house with my partner, with rent and bills for my share coming up to £400 per month. I am able to save £450 per month minimum of my salary (not including commission earned - if I earn commission I can save more than this).

Granted, I don't lead a frivolous life and don't treat myself too much but I get by and still have nice things and meals out etc.

Are you sure you can't cut back on your current spending to save a portion of your salary?

Even with this saving, my aim is to buy a house in around six years, so it's most definitely a long term plan!

I think you will find it very, very difficult to get a mortgage with zero deposit, even on the shared ownership schemes.

Odette

Like TimBear I am on about 23k gross and save at least £200 a month. I have a good quality of life etc.

If your priority is to get a mortgage, stop spending extoritionate amounts of money on whatever you are spending on. Or if you live in central London say, move to the suburbs.

You can work it out, it is that simple.

Yorkie1

Analyse your spending - go over to the debt free wannabee board and post a statement of affairs (SOA) which details your income and outgoings. They will help you identify areas where you might start to make savings.

Consider cutting your current housing costs - cheaper rental or go into shared accommodation.

You really really do not want to buy a house without spare money for the things which will inevitably need doing. I knew the house I've bought very well, and yet there have been unexpected expenses. If you can't save for a deposit, you're going to struggle to pay for these emergency things. Also, as others have said, as soon as interest rates go up, you will struggle to meet the repayments (either on a tracker or at the end of a fixed rate).

brit1234

danielley wrote: »

What about a shared ownership scheme?

Its a scam and now even with this scheme you now need a deposit with the very few lenders participating.

The original poster just needs to save.

chanie

As well as a deposit, you may have to factor in solicitors fees, stamp duty, mortgage admin fee's.... (the list goes on).

Then, when you move in - furniture, white goods etc.

Whilst saving for a deposit (OH and I lived with our own families to save up) I started to stockpile for my 'bottom drawer' so I got stuff on offers e.g. crockery, bedding, towels etc. However, we still had to pay out for stuff we hadn't accounted for like new carpets (the stuff they left was old and ripped). This was on top of stuff that our familes had donated (bed, sofa's, dinning suite).

As most people have said, they best thing you can do is save as much money as possible. This could mean moving back with family (if possible) or renting somewhere cheaper. Having a mortgage is a big commitment and does mean big sacrifices - there is no easy option. If you start saving now, you'll get used to not having as much disposable income (believe me, when you get your mortgage, you'll feel it).

Daisy4567

Meeper wrote: »

Being a homeowner is not the golden goose that people think. It is often better for some people to rent instead, so don't get caught up with the idea that home ownership is something to aim for. It's not the 1970's any more.

I second that

TheAllanCadenhead

Meeper wrote: »

Being a homeowner is not the golden goose that people think. It is often better for some people to rent instead, so don't get caught up with the idea that home ownership is something to aim for. It's not the 1970's any more.

I third that.

Doshwaster

Even if 100% mortgages made a magic return to the market you would still need a few thousand in savings to cover legal, moving and house setting up costs. On top of my deposit I went through another £5,000 in no time at all.

Hopefully the days of the 125% mortgage will never return so the only option is to save, save, save.

I understand the problem. As your income has grown so have your outgoings and somehow at the end of the month all of your money has gone. If your rent is affordable then it's too easy to get into a comfortable lifestyle with lots of treats as you don't have to worry about looking after the house - it is someone else's problem.

I have found the best way to start is to keep a diary of every penny you spend over the course of a month. Every penny. At the end of the month you will be shocked at where the money is going - those coffees, sandwiches, takeaways and magazines all add up.

The next stage is to see what spending you can totally cut out and what you can cut back on. Maybe limit eating out or a takeaway to a once a month treat or only buy essential replacement clothing. See what you can save per month.

There's no way around it. The first few years of house owning are tough so you are going to have to get used to a more frugal lifestyle anyway.