Can't seem to get a mortgage....

yorkshire_terrier_owner

Sorry to be the bearer of bad news, but the amount you are looking to borrow is simply too much. If you go on to Santander’s web site and use their mortgage calculators, you will see how much they are prepared to lend you based on your income. I’ve just been on and based on the numbers you have provided here, it states “The amount you may be able to borrow is £216,600”. That is without taking into account your credit references and children. These days, lenders perform a more complex affordability calculation than the rudimentary 3.5 times your income that they used to. Any dependents will reduce your affordability. Santander may accept the carer’s allowance but only 50% as it is a secondary income. Throw into the mix a credit history that is slightly shaky, and yes, you are aiming to high. Sorry to be blunt, but I will tell it straight!

If you want to find out how much you can borrow, you need to use the mortgage calculators on individual lenders's web sites, but bear in mind that this does not take into account the affordability calculations they do at the point of application.

RenovationMan

We borrowed £300k in 2010 from Abbey/Santander and it worked out at 5x my salary, which is comparable with what you are trying to do. However, I didn't have any CCJs and my deposit represented 33.33% of the house purchase, so perhaps both of these are going against you? In your position I would wait out the 2 years while your credit record sorts itself out and in the meantime I would get saving up to increase your deposit, but more importantly to give you a buffer when you buy the house and to cover moving costs.

Incidently, on a £360,000 house, your stamp duty will be £10,800. Will that be paid for via additional savings or do you intend paying it out of the £60k? This might also have an impact on your lenders decision because as well as having a deposit, we had additional savings to cover these sorts of expenses.

dimbo61

Could you not look for something smaller say upto £250K ( dont know the area you live and WORK! in )
1% stamp duty and more chance of getting the mortgage you want at 25% deposit ( nearly )

Hello123_2

The issue is the AMOUNT you want to borrow, not the actual borrowing itself.

Just look for a cheaper house.

I know you WANT a £300k house but it's not gonna happen at this moment in time I'm afraid. I know it's probably a little disheartening but think at least you will be on the property ladder paying for your own house not renting, and your monthly payments will be less, and you will have less debt.

There are still some fantastic buys out there for the £200k bracket.

Also consider buying somewhere a little run down for say £200k, spend a bit on it say £25k getting it how you want and for all you know it could be worth £300k then!

PM if you need anymore advice. Good luck :-)

ACG

I agree with hello123.

Did you find out why your applications were declined? Was it CCJs, Credit score or the amont you want to borrow? Im guessing its probably the last.

At best you are looking at around 4 times your income....but to be safe i would stick to about 3-3.5x (as a general guide). Add on £57k and thats what you should be looking at as a maximum. This leaves you a bit more for solicitors, surveys etc

dunstonh

I have a credit rating of good - 700 points. Probably not the best but I do not know how to get this higher right now.

With respect, you dont have a good credit rating. Forget any marketing score than a couple of the credit agencies give you to encourage you to pay their monthly cost. Lenders do not go by that.

You have a couple of settled CCJs in the last 4 years. That makes you a riskier option than someone with a clean record.

The fact you have £60k available should help mitigate that to some extent as you can put down a larger deposit. However, the biggest problem is that you are looking to borrow too much. You should be looking at around £250k as the price range with borrowing of £190k ish. Not buying £360k with borrowing of £300.

There is no way that a mortgage of £300k on repayment basis could be viewed as affordable. You would be paying over 50% of your take home pay to the mortgage. And that is on current low interest rates. When they return to more normal levels, you would be put under severe financial stress and could well end up being repossessed. Now that sensible lending has returned, you cannot see what you want being sensible.