Mortage Advisor - does this !!! up?

united4ever

Does this add up?

Had an offer on Thursday for my flat for the full asking price, now the Esate Agent put me on to their mortgage expert who reckons I can get a mortgage for 5 times my salary (around 150k....I earn 30k (or 35k with overtime). I have about 40k equity in my flat.

He worked out that it would roughly be about £750 a month if done over 28 years. I pay this much already on my flats mortgage so would be comfortable with that.

So, I am interested in pursuing this sort of scale of mortgage but I am doubtful I could lend this much. Maybe he's just telling me what I want to hear. I also have two kids.

Does this sound feasible? I have good credit I believe, permanent job too. Would like to look at houses around 200k and be purchasing for 190k if so. And of course, I will not get a mortgage through the EA, I shall go to an independent, whole of the market advisor to get the better rates. But the same question applies....can I really lend 150k based on the above?

ACG

I presume you probably also receive some sort of tax credits too?

I would say its probably possible if you do.

Also independent and whole of market are different - you need to decide on one or the other.

united4ever

yeah working tax credits and child benefit. Ok, well I need to do some research on mortgage advisors. I guess this website is a good starting point.

bigadaj

You're borrowing, the bank is lending.

Anything above four times looks stretchy, also higher rates will apply as you are more of a risk on a higher multiple and you will have a lower percentage deposit.

Also the amount you pay isn't guaranteed over 28 years, base rates will rise so you need to check repayments certainly at 7-8% and possibly 10% or more, as rates will no doubt rise before your mortgage ends.

Conrad

Impossible question. Apply and see how the score turns out.

Dave_Ham

5 * income is the maximum as a rule, although none of the top rated lenders will commit to these...

Unfortunately (not suggesting the case with you) people want the best rates tailored to their needs and the 2 are usually mutually exclusive.

The loan to value parameters are set at 75% 80% and 85% and the rates decrease significantly as the deposit increases.

Good luck

united4ever

Thanks for this useful advice.

Yes, regarding credit rating. Is there any truth in this theory.

I have 3 credit cards, two of which I use regularly and always pay off in full each month. The third one I never use but should I use it to make a couple of small purchases and pay off in full?

I heard that if you use and have access to credit it helps you credit rating, seems odd but I believe people who never use credit (who you'd think would therefore be a safer person to lend to) actually get less credit sometimes....is this right?