Remortgage Query

agile83

Hi guys

I will be potentially looking to move into a bigger house this summer based on how much i am allowed to borrow.

Im unclear as to what salary multiples etc are in place for people who are not 1st time buyers. Is it still 3 or 4 x salary or do lenders tend to be more generous when dealing with people who are already paying a mortgage?

Im hoping to have around 30k equity in my flat this summer due to the outcome of a potential inheritance and would look to purchase a house for around 160k and have a brand new 25 year mortgage of 130k. I would comfortably be able to afford the payments even with a hideous interest rate, but my wife and I's joint salary of around 36k timesed by 3 would not be enough for 130k for example

Apologies if this is a "how long is a piece of string" question, but i have no idea how easier or harder it is to borrow money when you already have a mortgage and wondered what your experience was with this?

Thanks

kingstreet

This isn't a remortgage query. That's changing lenders by staying in the same property and raising a new mortgage to repay the old one.

You are simply a subsequent purchaser looking to buy a new home and take out a new mortgage.

Affordability tends to be unaffected by your status but your credit score may reflect your mortgage payment history and hence may get you a bigger mortgage. Halifax for instance has three score/lending bands, A, B and C. A reflects the highest score and also the higher maximum lending and less status requirements. B is slightly worse etc.

I suggest you have a play around in a few of the major lenders' sites to see what comes out of their affordability calculators without going to the extent of applying for a Decision in Principle which will leave a footprint on your credit file.

I keyed your data into the Halifax calculator and the following resulted;-

C Pass - £155,235
B Pass - £162,000
A Pass - £162,000

Assumptions;-

2 adults, no children
81% loan to value
No existing credit
25 year term
Repayment mortgage
Incomes 18k each