likelihood of being approved for a mortgage

celiao82

Hi all,

I am about to apply to take over my flatmates share of our joint mortgage.

Obviously I have to undertake a mortgage application with the woolwich to ensure that I can afford to take it over on my own.

I currently earn £45000 approx.
The mortgage amount is £92000.
It is shared ownership and the monthly rent is £500.

The total amount of outgoings (including all bills) associated with the flat currently is £1250 - approx 50% of my monthly salary.

I have a loan for which I repay £414 pcm (it is from studying as I was a foreign student in the UK so was not eligble for a student loan). This will be repayed in another 2 years.

I can afford all the outgoings and my partner will also be moving in. He obviously wont be included on the mortgage application but will be contributing to the bills.

I also have a £500 overdraft which I do use, I have just never got around to reducing it. In March I went over the limit by £4 for less than 24 hours. I had money available in a different account with the same bank at the time, I just forgot about a transaction that was due to go out.

I also have a credit card which will be fully paid off before the application.

I have the following queries:

When I show the bank my bank statements for the mortgage application will going over the overdraft limit adversely affect the application?

I had not intended in applying for a mortgage in the next few weeks so my spending has been quite enthusiastic on socialising etc. Would I be better off delaying my mortgage application until I have 2 months of "sensible" bank statements available? I have not been regularily putting money into savings recently.

I will endeavour to reduce my overdraft before the application also.
How long should I leave between paying off the credit card and overdraft and applying for the mortgage?

Is there anything else I can do to improve my chances of being approved for the mortgage? I will have savings available when I apply for the mortgage but they will be used to pay my flatmate her share of the equity/profit after the mortgage has been approved.

Thanks for the advice.

Thrugelmir

celiao82 wrote: »

and my partner will also be moving in. He obviously wont be included on the mortgage application but will be contributing to the bills.

If he doesn't "exist" then his contribution as far as your mortgage application is zero concerned.

Affordability therefore seems to be an issue. If your share currently of the mortgage and bills is already 50% of your income. How are you going to convince a lender that you can afford the entire 100% outgoing?

Wh05apk

Should have no issue, £45k inc less £6kpa rent, and £5k loan repayments = £34k, so less than 3x income, so should not be an issue with the lender. Don't worry about the o/d provided there are no returns/unpaids etc, that will not be an issue.

celiao82

sorry I meant that the £1250 will be my new total outgoing if I take over the mortgage. Currently I pay £675 for my share.

Thrugelmir

celiao82 wrote: »

sorry I meant that the £1250 will be my new total outgoing if I take over the mortgage. Currently I pay £675 for my share.

That makes far more sense.