Young Persons Little Mortgage.

OneDay

Hi Everyone! And thanks for reading my thread.

I'm Male, 19 years old, My Annual Salary including bonus's etc is aroundd £19000 and I have very little debt , I have a credit card which I got to build my credit rating when I was 18. I live alone in a privately rented flat and I pay about £490 a month on rent then theres council tax bills etc which all get paid etc etc.

Ive been thinking more and more of the idea of buying a property recently, I know the way mortgages are at the minute and the deposit required and I dont think I would be what mortgage companies are looking for (well I dont think so anyway) , I work for RBS and I am able to go through the staff scheme to get a mortgage which you still need a 10% deposit but theres no arrangement fees and you get preferential interest rates. The value of the property I want to buy is just a little terraced house starteing betweeen 30,000 and 40,000, Its in the North of England, It may not be the most glamorous of areas for that price but really wnat to get on the property ladder.

I have around £8000 in savings luckily but cant really save much more as I have to pay bills etc every month so theres not much left over. But I was thinking if say I got a property succesfuly for 35k and put down a 4k deposit then Id have a little spending money to make it all liveable, eg like a new boiler which would probably be needed due to the price of property etc then what would be my likely hood of being accepted ?

I have checked the mortgage calculator at work and based on the details above my mortgage monthly would be really good at just under £200 a month which would free more of my money up to put towards doing it up and making it home.

As I am thinking just a starter home eventually down the line I could rent it out if I decide to move on into hopefully bigger and better things hehe !

But just wondered everyones advice on this and fingers crossed its good new ! I just dont wnat to throw money away on rent anymore, Thanks for any help !

Thrugelmir

What rate of interest would you pay under the staff mortgage scheme. As you may well fall foul of the HMRC beneficial loan rules.

OneDay

To be completly honest I dont know the exact rate but when I was looking through the T&C'S it did say that what you have mentioned abov ecould happen and declarations etc would have to be made to HM Revenue I only browsed that area very quickly but would probably need to read more into it.

Well on these comparisons sites for the same sort of mortage etc those repayment were comeing out at around 250 where as staff was coming around 200 so I think the staff rate was around 7% but would need to double check this.

it was based on a 2 year fixed rate deal with 10% deposit, there was a 5 year fixed rate deal and also tracker option but those required higher deposits.

ACG

Hi,

I used to work for RBS too (about 6 years ago in spinningfields). The staff rate is actually quite good....but it was beatable. However, i quite liked dealing with yourbank they were always pretty helpful.

You should have no problems getting a Mortgage for that. Affordability isnt an issue, if youve not had much credit and that what you have had has been good it should be fine. Its a relatively small mortgage on your wage. If the property does need a lot of work doing RBS might do whats called a retianer (a boiler wont be enough for them to do this) its basically where they withold some of the mortgage until the work si done but as you have a decent amount of money anyway that wont be a problem.

Personally as you can afford it i would be inclined to try to get to a 15% deposit if i could - you will get a better rate.

OneDay

ACG wrote: »

Hi,

I used to work for RBS too (about 6 years ago in spinningfields). The staff rate is actually quite good....but it was beatable. However, i quite liked dealing with yourbank they were always pretty helpful.

You should have no problems getting a Mortgage for that. Affordability isnt an issue, if youve not had much credit and that what you have had has been good it should be fine. Its a relatively small mortgage on your wage. If the property does need a lot of work doing RBS might do whats called a retianer (a boiler wont be enough for them to do this) its basically where they withold some of the mortgage until the work si done but as you have a decent amount of money anyway that wont be a problem.

Personally as you can afford it i would be inclined to try to get to a 15% deposit if i could - you will get a better rate.

Thanks so much for your help , I really want to just really oush and get on that ladder lol ! I am trying not too rush things and reserarch every possibility, I hope they see me as a good risk I suppose lol !

The houses are prretty much liveable and sound throughout but just from going to look at them etc peiple are actually living there and stuff just moderninsing needs to be done and boiler needs replacing or woudl do eventually but I could move straight in and then obviously work round things and budgets until it was sorted. I dont know if you would know but with staff mortgages through your bank is it the same credit scoring etc they look at or because your an employee your more of a safe risk ?

Sorry for sounding docile if I do, Thanks !

ACG

Nah you dont, if you dont know you dont know. If i never asked when i didnt know something - id be dafter than i am now :P
Im sure there is a saying that a daft question is one you dont ask.

I never took a mortgage out through yourbank, but my understanding is that its exactly the same.Same underwriters, same principle etc. Get your application submitted, stop worrying. You might not pass an automatic credit check but once it gets underwritten i would be surprised if they declined you based on what you said. I cant speak about the property passing but based on what youve said if its a solid building and its just minor modernisation you should be fine - but you have the money there anyway so dont worry.

Also, you should probably still think about seeing an advisor, once you have responsibilities like a mortgage and bills you might want to take a look at Income Protection insurance. Trust me, once your free of the parents you wont want to move back...pizza boxes everywhere, women coming round, being a general scruff so if you were unable to work and had to give up what you had worked for you will be gutted. just a thought though.

Pont

Although I have no practical advice to offer you certainly don't sound 'docile', you sound like a very responsible young person who has the intelligence to weigh up their options in a sensible manner. Is there not a mortgage adviser at your workplace who could run through your options with you (you could always take this advice to a different mortgage provider to get the best deals available)? I actually consulted with an IFA which proved to be money well spent - wish I'd have done it at 19 though!

Good luck!

OneDay

Oh well thats one positive lol ! Im not docile well not quite hehe !

I thank both of you for the last 2 posts ! so thanks so much !

I think the best thing to do is take the plunge and phone 'yourbank' tommorow to see how to proceed and seek advice from them, Hopefully theyll think Im a safe bet and ill pass, If i did I would be elated hehe !

If I werent able to pass would I need to seek a broker or...? So that they could find me a mortgage , I hope its a lot simpler than this but just trying to cover all bases and sorry for another question lol !

ACG

IF you get rejected try and find out the reason behind it.
Then yes find a broker and go from there. Or come back on here post the info and we will see what we can do.

OneDay

ACG wrote: »

IF you get rejected try and find out the reason behind it.
Then yes find a broker and go from there. Or come back on here post the info and we will see what we can do.

Thanks so much ! Im really greatful to know that I can come on ask any questions hehe !

Thanks again !

Southernman

I have a yourbank mortgage and they tax me an extra £60 a month by HMRC due to benefit in kind. Quite maddening.