How much could we borrow

poozer140604

Before we go to a mortgage broker for real I just wanted some idea what size of mortgage we might be allowed to borrow. Here are our details!

My gross annual salary - 32400
Husband's gross annual salary - 24000
Husband's student debt - 8200 (still deferrable)
Money available for deposit - 20000 (there is another 5000 set aside for fees etc)
Monthly amount we can afford to pay - 800

We have no other debts.

I believe I have a good credit rating while my husband's application for a credit card from his own bank was recently rejected (we are planning to get details of his files etc soon). I am a 1st time buyer but my husband has his name on a mortagage on a flat his sister lives in but that was paid for & guaranteed by his father. We make no contribution to this & his dad will 'buy' my husband's half of the mortgage when we find one of our own.

We were planning to start on an interest only option initially.

We are looking to buy in SE London (the cheaper parts!) as our jobs are here but this will obviously depend on what we can borrow.

Thanks to everyone in advance!

herbiesjp

You could look at somewhere between £250k and £280k

However the actual figure will depend on your exact circumstances and what credit score you get with the lenders

I think it is important to get your credit files, just to find out why the card was rejected - it could be nothing but it could also highlight other problems

You should show those details to your broker when you see them.

Also please remember that although you may be able to get tis mortgage amounts agreed, you would really need to make sure that whatever mortgage amount you opt for is affordable to you both on a monthly basis, not only now but in the future if interest rates have increased

HTH

JoeK_3

poozer140604 wrote: »

Before we go to a mortgage broker for real I just wanted some idea what size of mortgage we might be allowed to borrow. Here are our details!

My gross annual salary - 32400
Husband's gross annual salary - 24000
Husband's student debt - 8200 (still deferrable)
Money available for deposit - 20000 (there is another 5000 set aside for fees etc)
Monthly amount we can afford to pay - 800

We have no other debts.

I believe I have a good credit rating while my husband's application for a credit card from his own bank was recently rejected (we are planning to get details of his files etc soon). I am a 1st time buyer but my husband has his name on a mortagage on a flat his sister lives in but that was paid for & guaranteed by his father. We make no contribution to this & his dad will 'buy' my husband's half of the mortgage when we find one of our own.

We were planning to start on an interest only option initially.

We are looking to buy in SE London (the cheaper parts!) as our jobs are here but this will obviously depend on what we can borrow.

Thanks to everyone in advance!

Looking at your figures and the prices of property in the south, you may be better off looking at a shared ownership mortgage.

This is based on your affordability of £800 pm, as a £200,000 mortgage at 6% interest only would cost you £1,000 pm.

Shared Ownership is a part buy, part rent scheme, which enables purchasers to buy a home in stages. Purchasers can buy an initial share between 25% and 75% of the value of the property and pay a subsidised rent on the remaining value of the property. Shared ownership properties can be provided by housing associations, housing trusts and local authorities.

These organisations try be as flexible as possible with regards to the initial share purchased, but this may be as much as 50% of the market value at some of their developments.

A service charge will normally be payable to cover the cost of communal maintenance. The service charges payable can remain the same whatever percentage you own of your home and continues to be payable should you purchase your home outright where possible.

You will need to have sufficient savings to cover the initial cost of home ownership: legal fees and stamp duty for example. You will need to be able to meet the costs of rent, mortgage, service charges and other associated outgoings.

As your income increases, you can buy further shares of your home until you could own 100% of the value and no longer share the ownership with the housing association or trust. The greater the percentage you own, the lower the percentage on which you pay rent. However, if you do not wish to buy more shares in the property, you do not have to.

Obviously, the more you own, the less you pay in rent. And, if you can buy your home outright in the future, then no rent will be payable.

JoeK