Getting a mortgage with a partner who is self employed?

Daniyella

I'm confused? Merry Christmas to everyone btw!!

grifferz

Daniyella wrote: »

Quiet again?

What are you still waiting for answers on? A lot of the posts have been the opinions of other posters saying they would not necessarily advise 35 year mortgages and new builds. Those are people's opinions; it's okay to disagree with them as long as you take their views under consideration. There's probably not much point in further back and forth on that.

So, the only thing you've asked that hasn't yet been answered as far as I can see is:

Daniyella wrote:

what would happen if say my partners dad took a 0% credit card out and put my partners £7000 credit card debt on this for a couple of months would this effect our affordability?

I have heard of that sort of thing working for some people, but most of the time the lender wants to see your bank statements and details about where your deposit comes from.

If your partner's dad would be willing to give you £7k along with a signed promise that this was a gift which he did not expect to be repaid and that he would have no interest in your property (this is referred to as "a gifted deposit") then that would be fine.

If you can't do that then there is always a chance that the lender will see the payment from a third party and ask for details of what that is. Your credit reports will contain your credit card balances for the last few years, so they will show it all being paid off, and your bank statements won't have that payment.

Was there anything else you were waiting for answers on?

Daniyella

Ok thanks for that bit of info, what's everyone's views on the new build scheme? I'm a little bit confused on that, what's the pro's & cons?

geoffky

I think you need to do it with wide open eyes...Because i would do anything in my power to dissuade my daughter from doing what you want to do..
WHY?
Because i have done what you are going to do and i bought a brand new house when i was younger.And believe me it was a mistake..

Why do you think this scheme exists?
It is not to help you but for the builder to get the best possible price for it and here comes the catch,,
We will offer them to first time buyers only because they do not ask so many questions and believe we are doing them a favour but the reality is that we could not sell these houses for this price on the open market..
So to shift them we offer them to people who do not have a clue what they are doing and we will even make a lifetime mortgage sound like we are doing them a favour......

I hope you walk into this with your eyes wide open ..Good luck..you might need it..

You might want to check what percentage of the estate is social housing and where because some of it will be...

Daniyella

The mortgage payments ink change BT about £100 if we do it over 25 years so that's something to consider. I wish I had a larger deposit, but although we cannot save our rent payment is the first payment that leaves our account each month and we've never missed a payment, have u heard that mortgage companies are starting using these in there assessment on whether to hand out mortgages this will go strongly in our favour.

I'd still choose a new build over an old property, there is going to be a certain percentage of housing association homes on any site we choose that's just how it is nowerdays, the position on the site map is directly opposite Greenbelt land too.

Daniyella

Also this will just be a stepping stone my partner wants to move Back out to the country in a few years

hazyjo

Daniyella wrote: »

Yes I understand that hence why we are buying a 4 bed rather than a 3 bed when there is only 3 of us so we have space for a new baby too once we've had it so we will be in it for the long run, I'm thinking we will have a larger deposit the way we are going anyhow as I'm having urgent spinal surgery on Thursday thanks to the dimwit who drove into me!!

Daniyella wrote: »

Also this will just be a stepping stone my partner wants to move Back out to the country in a few years

Bit confused as to which it is - are you staying put for the long run, or looking to sell up in a few years' time?

Jx

Daniyella

Well say 5 years but our mortgage is 2 years fixed rate then we can change over to lower rate x

kingstreet

Daniyella wrote: »

Well say 5 years but our mortgage is 2 years fixed rate then we can change over to lower rate x

Some serious assumptions have gone into that statement.

You assume your current lender will offer you a new product, or you assume you'll have enough equity to be able to remortgage to a new lender in just two years.

You also assume rates will be at their current level, or lower.

Threads on here from others in your situation actually approaching that two year point suggest your confidence may be misplaced. Their current lender won't offer them another product for one reason or another, or the product offered isn't particularly attractive.

They don't have enough equity to remortgage elsewhere, as the newbuild premium is gone and their property value hasn't yet recovered. They haven't paid off enough of their existing mortgage to qualify for a lower loan to value product. I don't know a single lender offering a remortgage product above 90% and your chances of getting below that, without making significant overpayments each month, appear unlikely.

TBH, you're going to do what you want, so I'm going to leave it there. You know the risks and can plan against them happening to you.

thelem

Daniyella wrote: »

Well say 5 years but our mortgage is 2 years fixed rate then we can change over to lower rate x

Hold on for a second! Your interest rate is likely to decrease if:
a) The Bank of England base rate decreases. As it is 0.5% it can't decrease much more and may well increase.
b) You become a more attractive customer to them. You'll have lost the new-buy incentive that made them offer you the deal in the first place, and with a 35 year mortgage you won't have made significant capital repayments, so if anything you will be a less attractive customer.

Given the combination of these factors I would put money on your mortgage payments going UP after the end of the fixed rate.

It sounds like you are falling into the "rent is lost money" trap. Don't forget that part of your rent goes on the up keep of the property, including buildings insurance - you'll need to find that money yourself on top of any mortgage repayments.

If you get a mortgage, you will be paying mortgage interest and periodic remortgaging fees. These are "lost money" exactly the same way that rent is, and could easily exceed your current rent.

An advantage of owning your own home is that if rates remain low (and that is very unlikely to be the case over the next say ten years) then your monthly repayments do not increase, where as market rents are likely to increase over that time. If rates rise, they could rise much faster than rents. Also, if you are making significant capital repayments then that will reduce your monthly mortgage interest, so there will be less "lost money" each month. That means a shorter mortgage term (25 years or less) and/or regular over payments (if your mortgage allows - if not, save the money and use it when remortgaging).