ftb loan , dont know who to turn to

scotsbhoy1

hi im hoping to find some advice here on a loan firstly il tell u a bit about myself.

im 21, living with the parents, full time employed as an electrician and i just became time served this month so im now on 23000 p/a(plus il be working away the next 9 months earning 2300 or 2700 a month depending on what shift im on)mycredithistory isnt a long one obviously.my credit includes my monthly gym membership,contract phone (had a contract since i was 18) paid off a laptop ,car ins and my overdraft which my wage pays off every month but ive never had a late payment,all my accounts have been satisfied ,on the electorial role, no negatives on my credit report and my credit score is 855.it usedto be 951 but looking for a loan has decreased it significantly.

have been looking for a 14000 loan to pay the deposit on a house(have a mortgage ok) and a car (i usemy dads) with some left over to do up the house.basically i keep gettin denied decent loans because my lack of credit, the most recent being zopa.i fall into the young category and genuinely thought that i would get a loan off them,i was quoted 10.5 % over 5 years, £300a month, buuut just got an email saying theve declined me.i dont kno why,i would class myself a a prime candidate but such is life.

bank of scotland are offering me 14000 at 20% for 7 years at £300 a month.as far as im aware,this is my last option. what im asking is, me being a first timebuyer and all, is there any other options i could consider, or any tips that would be helpfull for a loan?

thans. dave

chalkie99

First off, getting a loan for a mortgage deposit is probably not an option and the mortgage company will check to see where the deposit comes from.

Secondly, you seem to be heading down the fast lane here with a mortgage and a big loan, plans for buying a car, improving the house, etc,

That seems to be making a £23k wage go a long way! have you really worked out a budget?

Thirdly, you are already living in an overdraft, how caan you possibly afford all the repayments, not to mention the other joys of house ownership like rates, water, heating, lighting, etc......?

Sorry it's a negative response.

RichGold

All that sounds very, very optimistic. I'd sit down with your parents and cost everything out on paper. I think you'll be very surprised how quickly you'll be out of money and then out of luck.

And Chalkie's right, no mortgage company will let you use a personal loan as a mortgage deposit. The reason they want a deposit in the first place is
a) so they are not taking all the risk, it shows willing on your part.
b) it shows you can save money on your own.
Neither of which would be satisfied by you simply taking a loan to cover the deposit.

poppasmurf_bewdley

And on top of everything else, how are you going to pay for the Council Tax (probably £100 per month), water rates (£40pm), gas and electric (£75pm) TV Licence (£12pm) Broadband and landline (£20pm), Sky (£20pm min), Car Insurance (£1000pa min), House insurance, etc, etc, etc?

Caz3121

You should save for the deposit. As has been said mortgage providers will not accept a loan as a deposit and any loans/debts will affect affordability in how much you can borrow.
I assume you in a very cheap housing area if you can buy on £23k, unless you have a 20%+ deposit you are not going to get a very good mortgage rate.
As has been said sit down and do the sums and you may find that with all the outgoings that come with living on your own you may have to reset your expectations.

bodmil

I always think if I can't afford to put money aside for a deposit for at least a year, it's not the right time for me to buy a house.

scotsbhoy1

thanks for the replies and concerns.

this isnt something im jumping into all guns blazing you may think im young ,niave and out of my depth ,quite rightly so since the economic crisis now is due to the young and stupidly niave but this is something thats been ongoing since january,just so hapens that a house i was interested in is now massively discounted due to the lovely old lady dieing.ive crunched my numbers again and again and i can afford it.i work in the shipyards you see, currently on the aircraft carriers being built,so my jobs basically secure for the next 9 years.i walk away with 1400 a month and calculated(overcalculated) the numbers and i would be paying around 1050.this is calculated by my research into the variable outgoings in a month like food,gas,electricity,phone,broadband,petrol,tv and in getting an average price on each and adding £20 to that average.adding on the quoted loan and mortgage(il be paying the car outright with the loan) i get a total of £1050leaving around £300 to spend/save.i say my basic a month is 1400 but im not including my overtime that im pretty much guaranteed because i have not used overtime money in my monthly payment calculations(that would be stupid) and the fact that for the next year im working away which add another £1000 to my monthly total would help repay a loan faster.theproblems isnt that i cant affordthe loan, its just i dont want to, its a rip off.so im asking if possible, any ideas if i could get it cheaper anywhere else?any other placeslike zopa?maybe reducing the loan to 10000 would help andjust gradually modernize the house?.


few points ... i live in scotland so dont need to pay for water and im not sure about the mortgages in england but here, using a loan for a deposit is fine, as long as you dont say your using the loan for a deposit on a house in the actual loan application.

ViolaLass

scotsbhoy1 wrote: »

im not sure about the mortgages in england but here, using a loan for a deposit is fine, as long as you dont say your using the loan for a deposit on a house in the actual loan application.

So provided you commit fraud, it's OK.

Say it even works, what if interest rates go up? And if you haven't managed to save £300 a month so far, why will it be different once you've got a house to decorate and maintain?

ceegee

scotsbhoy1 wrote: »

using a loan for a deposit is fine, as long as you dont say your using the loan for a deposit on a house in the actual loan application.

:eek:I think that would make the loan application fraudulent, wouldn't it?

Sounds very risky to me.

_Andy_

The application would be fraudulent and I think you're underestimating the savvy of most underwriters.
Classic case of asking for advice, not liking the response but going ahead with it anyway.

ceegee

Also, if you are going to be working away for the next 9 months and earning even more, surely this would be a good time to stash away those extra earnings for a deposit? If you are going to be away, you don't need to buy a place right now either, do you?

I reckon the best thing would be to save everything you can over the next 9/12 months. Additionally, by doing it this way, it will be less for you to have to pay back in the future.