1st Time Buyer

ineedtosavemore

I wonder whether someone could help me.

I have a full-time job earning around £34k however I am on a temporary contract which ends in March 2012.

I have always rented in the past but I am now thinking of buying.

I could scrape together a deposit of say £11k (some of which would be my savings and some has come from my parents) but I know a mortgage will be difficult to find particulalry as I have a temporary contract. Do you think I would get a mortgage if my parents acted as guarantor?

I got my credit report from Equifax today and it looks good - except my electoral roll info is out of date - I am currently working on getting this updated. I noticed however that my gas and electricity payments are not on there and neither is my previous credit card. Is it possible that these could be ammended? And if so would it help my credit score?

Thanks for your help in advance - I am a complete novice so help is definitely needed!

allybee101

Hi,
I am going through the process of buying my first place (shared ownership so slightly different, and now waiting to hear if I've been accepted by the housing trust).

I had an appointment with an Independent Financial Advisor (IFA) (part of the process for S-O) and they did ask about work. Apparently the usual situation is for the mortgage provider to ask for P60 and 3 months wage slips. Some ask for bank statements too.

There was no question about fixed term contracts but I imagine that you would be advised to tell them about your employment status.
They might consider it a risk as your contract is so short. Are you likely to get it extended or go straight into another job? Would a new job keep you in the same area or would a relocation be likely (in which case is buying somewhere going to restrict your job prospects)?
Could you parents afford the monthly payments if you were out of work for a year/18 months?
It might be worht phoning an IFA or mortgage brokers and asking for their advice on how they view fixed term/temporary contracts.

I can't help with the credit report questions, sorry.

ineedtosavemore

Thanks allybee101 for your reply.

In reponse to your question. It is likely that another job opportunity will have arrisen by the time my contract expires and my wage should stay the same or increase slightly. I'm also likely to be working in the same area so it won't really restrict my job opportunities. However, if things don't go as planned then my parents would be able to help me out. I graduated in 2004 and omitting my year out to travel I have been in full-time employment so I can provide P60's and wage slips etc.

Good luck with your move!

ManicMum

what value property are you looking at? I would say if you are having to 'scrape' together a deposit and getting guarantors, I would be very wary even if you could get a mortgage. There is no guarantee you will have work next year - do you want to get into arrears or start owing your parents so soon? You say you graduated in 2004. I don't know your age but are you quite young? I'd wait and save some more money up. House prices probably aren't going anywhere at the mo so fret not!

ineedtosavemore

I'd probably be looking at something around £90-£100k. Believe it or not I'm actually pretty good at saving when I want something big. Since graduating I've been on a lot of holidays, taken a year off to travel, bought a pretty decent car, and paid off my student loan; all whilst paying my rent. I also have nothing on my credit card and although I occassionally use my overdraft I'm not in it just now and it's been a long time since I had to rely on my mum and dad for finances! I just thought I'd be renting for a while longer so I've never thought of saving a deposit which is why I'd be scraping one together now. Having said that, after reading the replies and also some other threads I'm thinking I should maybe just keep renting a while longer and see what happens next March. That way I take the pressure off, I'm not putting any pressure on my mum and dad, or their finances; and I can ensure I have a permanent job and some more cash in the bank.

I am still curious about my credit report question though:
"I noticed however that my gas and electricity payments are not on there and neither is my previous credit card. Is it possible that these could be ammended? And if so would it help my credit score?"
Does anyone know the answer to this?

beecher2

Utility bills aren't shown on credit files as you don't enter into a credit agreement with energy companies. I don't know about old credit cards as I've only ever had the one. I think you're wise to wait - can't see house prices increasing. Install propertybee and keep an eye on the properties in the areas you're interested in.

allybee101

Sounds like you're being very sensible about it all! March 2012 is only 8 months away, if you can keep renting then that sounds like the best way to go. And then if you find a fab job that's outside your commute-able distance you're not tied down.

It sounds like you don't need to worry about the utility bills, and if the card is quite an old account I wouldn't worry too much about getting this added. You could always ring Equifax and ask if it would help? I'm sure they'd be able to tell you.

I've had my application approved so I'll be getting an offer letter in the next few days! I'm getting rather excited about my own home!
From the past few conversations I have had I would suggest you also consider saving for the hidden costs of buying...
Solicitor's fees - £400-800 or more. If there are survey fees these might add more.
Mortgage brokers/ arrangement fees. Mine's going to be £250, you can get some costs added on to your mortgage but not all. The IFA was very helpful in explaining all the fees etc.
Insurance - contents & buildings insurance - you often pay an admin fee to update your details even if it doesn't increase. £25 upwards. Your buildings insurance is probably covered by your landlord at present?
Furnishings - curtains - new windows are bigger so I will need to buy curtains, plus random stuff like towel rail, loo roll holder, wardrobe etc (of course these aren't necessarily essential straight off - the towel can sit on the side of the bath for now, although I would like curtains straight off so I don't flash the neighbours!)
Furniture removals. Or do you have any friends/ family that would help in exchange for pizza and wine/beer?
Probably worth adding another £1500-2000 to the budget for the extras.