First time buyer in debt!

chrisbailey

Hi All

I am currently hoping to buy my first house with my girlfriend in the next 6 months. We are currently both living with our parents. However, we are paying the following loans: Me 2 loans at £250 and £150 GF 260 plus student loan £80. My loans have 6 and 7 years left and my girlfriends 4. However, I took out a loan last week to replace the existing loan of £250 per month. It would have reduced the term by 18 months. However, if I use it to pay off my girlfriends, we can have the same monthly commitments, and have a £6000 instant deposit from the money left over. It does push her remaining term from 4years to 6 years though. THe only advantage would be that as she has CCJs from 3 years ago, she would now have no credit commitments. As she earns £25500 as oppose to my £19000, would she beable to get a mortgage in her name for around £105000, with the deposit of £6000.00? Many Thanks for your help

talksalot81

Dare I suggest that you get rid of your existing debt before getting yourself into a whole shed more - especially with the current level of uncertainty...

UK007BullDog

Oh boy, sorry, I will be brutally frank.

You both live with parents, have had CCJ's, have loans coming out of your ears and dream about purchasing a property.

All loans you have running longer than 1 year will be fully taken into account. That means the yearly payments due will be taken off your income.

Are the CCj's paid off/settled?

With the 3 CCJ's she might be able to get a loan but maybe not the 4x income salary. I think more 3x so you are looking at £75,000 but you have to take away the loans before you multiply so around £65,000. To reach the amounts you are looking for your income minus the loans have to be added as well.

Because of your credit records you might not be able to get a 100% or 95% mortgage. Probably more 90% but I suggest you check with a broker for the best suitable deal open to you both.

But on a more direct note I suggest you first of all get rid of the loans you have as living with parents you should really be debt free.

MortgageMamma

Whilst I agree with most of what ukbulldog is saying, I think being debt free is an ideal world and you should consider looking at a 125% mortgage and consolidating those loans within that mortgage. That is one way round it. There are a number of lenders who do mortgages such as this and I think you may get away with the defaults if your girlfriend has been good with her credit since. I managed to place someone with one of these lenders who had 2 defaults still unpaid from 2004 back in October, so never say never until you have had it checked over by a broker.

chrisbailey

What I meant was, if i take on her loan in my name, she would not have any debt. She has 4 CCJ's all settled, one 18 months ago and the rest 3 years

Robert_Sterling

MortgageMamma wrote:

Whilst I agree with most of what ukbulldog is saying, I think being debt free is an ideal world and you should consider looking at a 125% mortgage and consolidating those loans within that mortgage. .

Hope spings eternal here!

talksalot81

Robert_Sterling wrote:

Hope spings eternal here!

I have to be honest that I wonder whether someone without an interest in the overall market would give that advice...

MortgageMamma

Its not advice - I dont even know this person and have not assessed their circumstances- its opinion, and its not set in stone that I think he should do it, its an option for him.

A good adviser will explore all options for a client, explain the pro's and cons, and let them make their own mind up.

Like the title suggests. we are the advisers, not decision makers to our clients, so take your cynical thoughts and cast your aspersions elsewhere.

talksalot81

It is just amusing that those with 'mortgage advisor' very very rarely suggest that an individual would be best avoiding a large mortgage debt...