Can I get a mortgage? Help needed urgently

BEY

Hi all,

New to this forum and looking for advice/help/recommendations.

My situation:
FTB (in London) 10% deposit or well 13K looking for a flat in the region of 125-130K. I wanted to buy a property but thought it would be best to get an AIP before starting so that I can get a move on quickly. Thought it would not be an issue to get one with my bank (HSBC) who I have been with for 14 yrs but when push came to shove they told me they could only lend me 90K. nothing near the 117K (max) I would need.

Salary - Base 30K plus benefits of which I take about £200 in cash
Bonus - usually about £1K/1,200 but does not state it is guaranteed in my contract as it is based on a % but never lower than £1k.

Debts - none other than credit card of £4800 which I would have paid some of by the time I make the application.

How much can I actually borrow? Seems these affordability calcs are rubbish as they clearly are no reflection of what the bank can actually loan.

I have good credit according to experian (score 983)and equifax, no late payments in the last 12 months, no CCJs.

So where do I go next? Can I get a deal out there?

Spoke to a broker recommended by a friend, took my details said he would do a credit check etc and get me an AIP. Are they supposed to do the credit check? or the mortgagee?

He also has not called back and I have been chasing him for 2 days by the way!

Please any advice/broker contacts would be much appreciated. I have been eyeing a couple of properties and would like to move quickly if poss.

droiderm

No recommendations here but halifax would lend my wife 124 on 25k over 37 years.

Dave_Ham

Hi - you will be able to get a maximum of £150k based upon your basic income.

HSBC are well known to be tighter on income multiples, so do not worry.

Not sure why a broker would take details and not return calls, gives the industry a bad reputation which is frustrating...

Friends and family recommendations are usually the best sort to get a decent broker

Mrs_Z

Sorry but where do you think you will find a half decent flat in London for £130k?

I'd be surprised if you can find anything below £175k unless you're willing to refurbishment work.

From the figures that you posted and the lack of deposit, I don't think you can do it by yourself.

BEY

Thanks for the prompt responses.

Dont know of any other brokers so can anyone recommend in the london area?

BEY

Mrs Z - does that mean that the 90% LTV advertised by lenders does not actually exist? Or that I may not meet criteria?

Dave_Ham

Also be mindful in the London area that many of the Ex Local Authority estates in some parts of London cannot achieve a mortgage with many lenders.

The broker you are looking for should manage this for you, butworth mentioning as part of your search

kingstreet

The income multiple used by lenders takes your gross annual salary, possibly plus a portion of any variable earnings (subject to evidence) and then makes a deduction for loans, HP, credit cards, dependents, maintenance outgoings etc.

On your salary, the maximum you'll get is 5x your income, but only AFTER other outgoings have been deducted. The credit card debt, snapshotted today, will hit your borrowing power by £8,640 on a 5x income multiple.

If you haven't already done so, sit down and do a budget planner for your living costs after you move. Don't inadvertently shoot yourself in the foot by giving figures to a lender which are inaccurate as you may reduce what you can borrow in some cases, Santander for example.

happycamel_2

You won't get recommendations for specific brokers on this site, it's against forum rules. But google for your area and check out reviews online, most Independent Financial Advisors are mortgage brokers but it's possible to be a MB without being an IFA.

Mrs_Z

"Mrs Z - does that mean that the 90% LTV advertised by lenders does not actually exist? Or that I may not meet criteria?"

No, this is not what I mean. What I meant that I doubt that you can find a decent flat in London for £125-130k. In which area are you looking to buy?

R_P_W

Remember you will also need stamp duty, mortgage arangement fees, moving costs, legal fees etc.

I agree with Mrs Z - you are going to struggle to find something for your budget.