Any way to get a £150k mortgage on low salary?

maninthestreet

150K mortage, over 50 years at 5.25% p.a interest works out at £707.82 per month for a repayment mortgage. In 2 years you would only have paid off approximately £1200 pounds, in 4 years £2650. Your buying/selling costs will greatly exceed even £2650, so your only way of making a profit is to hope house prices keep rising in the same way they have done for the last few years, which may not be the case.
I have a BSc in Computer Science, and have worked in the IT industry for 22 years - I'm not aware that there is a great demand in the commercial arena for IT graduates specialising in AI, this is still very much the realm of research, though of course that is not to say jobs do not exist that demand
this knowledge.

J-Llo

movieman wrote:

You'd barely be paying anything off of a 50 year mortgage; almost all the money you paid would be going into 'someone else's pockets'... i.e. interest to the mortgage lender.

But hey, go ahead: just don't come back and complain if you're bankrupt in 2 years.

I wouldn't be bankrupt as I would just sell... the apartments are very sort after properties, a lot of actors, celebrities, footballers own apartments in the same building.

I never said this is what I am going to do, I merely pondered the question of '.. is it possible..'

tigerminxy

J-Llo wrote:

The only reason I wanted to buy instead of rent is that renting is just putting money in someone elses pockets.

Same thing applies to interest payments to a mortgage lender. If you're thinking about selling up in 2-4 years then you need to factor in the costs of buying and selling into the equation:

- stamp duty
- conveyancing costs
- removal costs
- agency fees
- mortgage redemption
- &c.

Also you've got the regular costs of Council Tax, home maintenance, gas, electricity, telephone, insurances. Have you really considered these costs on top of just the mortgage payments? You also need to give yourself enough to live on.

If you think this flat is such a good investment, if your parents have the money/equity, how about getting them to take out a buy-to-let mortgage on the basis that you and your friend will be renting and coming to some sort of arrangement with them?

J-Llo

tigerminxy wrote:

Same thing applies to interest payments to a mortgage lender. If you're thinking about selling up in 2-4 years then you need to factor in the costs of buying and selling into the equation:

- stamp duty
- conveyancing costs
- removal costs
- agency fees
- mortgage redemption
- &c.

Also you've got the regular costs of Council Tax, home maintenance, gas, electricity, telephone, insurances. Have you really considered these costs on top of just the mortgage payments? You also need to give yourself enough to live on.

If you think this flat is such a good investment, if your parents have the money/equity, how about getting them to take out a buy-to-let mortgage on the basis that you and your friend will be renting and coming to some sort of arrangement with them?

Yeah I had thought about that too, and I'm glad you have brought that up too. Like I said above I'm just merely asking the question to you all and getting advice.

If I decide that I do want to buy then I guess something around 60K would be more realistic.

AndrewSmith

Sheffieldstag wrote:

Just try enquiring with a number of the mortgage companies to see what is available. I guess they'd offer nothing due to the huge amount.

Dont do this as it will lead to multiple credit searches being carried out and showing on your credit file potentially damaging your credit rating.

MoneyGirl_2

>> I wouldn't be bankrupt as I would just sell...

But if prices were to fall say "30%" to give a previous example, and you "just sell.." then you would be 30% in negative equity. Who pays that 30%? No one, you'll go backrupt or repossessed. It's so easy to forget about negative equity.

It's up to you, but I think you're just trying to find a way to do it. You'll be better off renting a room for quids and saving any surplus for a future deposit. This is not the time for you to invest. *

* In my opinion.

angelfire

Have you considered buying with a friend rather than on your own? it would be easier to raise (and afford) a mortgage for £75k than £150k....

Seems to me you're trying to run before you can walk - there's lots you may want - all at a certain 'level', but you need to start at the bottom and work up. At the minute you're working on a series of ifs and buts - assuming that you'll a) walk straight into a job and that b) it'll be really well paid. Both of these things may not even happen!

My advice is to lower your sights until you are in a more secure position income-wise, then start at the bottom and build up!

ollyk

J-Llo wrote:

I'm majoring in Artificial Intelligence... companies in this field take on graduates at really good salaries due to the nature of the subject matter.

Have you considered a degree in 'Artificial Common Sense'? - I suspect demand for graduates of this type will increase shortly. Besides all the people working on Artificial intelligence will soon be making themselves redundant :rotfl: ...

J-Llo

MoneyGirl wrote:

>> I wouldn't be bankrupt as I would just sell...

But if prices were to fall say "30%" to give a previous example, and you "just sell.." then you would be 30% in negative equity. Who pays that 30%? No one, you'll go backrupt or repossessed. It's so easy to forget about negative equity.

It's up to you, but I think you're just trying to find a way to do it. You'll be better off renting a room for quids and saving any surplus for a future deposit. This is not the time for you to invest. *

* In my opinion.

Thanks very much... I appreciate your reply. I agree on the negative equity aspect, thats something every first-time buyer has to risk. But i do realise the size of the mortgage would be too steap at this moment in time.

cheerfulcat

J-Llo wrote:

Thanks very much... I appreciate your reply. I agree on the negative equity aspect, thats something every first-time buyer has to risk.

Not just first time buyers. Anyone with a mortgage. But as your plan is to sell within a few years of buying, and as you would be buying at what could well be a market peak, you would be taking on far greater risk than most.