5k short on mortgage - what can we do?

bananz

Hi there,

We have found a house we *really* want to buy, but unfortunately the owners are asking for an increase of £5k on our max offer of £100k.

What can we do (other than wait and hope they reconsider)?

Being recently self-employed, the max mortgage we can get is £85k + £15k deposit.

How would it work if we raised more cash? Would it have to be to increase the deposit and lower the LTV or as an extra to the mortgage? Sorry if this is a stupid question, but I am a complete novice!

Many thanks in advance!

chunkychocky

£75k mortgage, plus £15k deposit is £90k, so I hope you know how to get to your £100k.

Sorry I know nothing about mortgages nowadays so can't advise, but just thought I'd check you have your arithmetic right before you go any further.

Lou67

bananz wrote: »

Hi there,

We have found a house we *really* want to buy, but unfortunately the owners are asking for an increase of £5k on our max offer of £100k.

What can we do (other than wait and hope they reconsider)?

Being recently self-employed, the max mortgage we can get is £75k + £15k deposit.

How would it work if we raised more cash? Would it have to be to increase the deposit and lower the LTV or as an extra to the mortgage? Sorry if this is a stupid question, but I am a complete novice!

Many thanks in advance!

YEP, the totals DO come to £90K. Did you put a typo hun???

If you need an extra £5K, that is not much really, in the scheme of things... is there no way you could ask about maybe extending the term of your mortgage??? (ie; if you're planning a 25 year mortgage as most do, ask for a 27 year one..., so you can have the same monthly payments but borrow a higher amount) You could always pay more each month when you're a bit better off in a few years, to shorten the term back down...

Have you said anything to your mortgage lender?

bananz

Sorry - yes I meant to type £85k lol! Our mortgage broker has already stretched the term etc. to the max and the only way we can borrow more is if my husband's work provide some kind of written confirmation regarding his overtime which he's doubtful they will commit to. It's just so frustrating to be so near yet so far!!

ETA: we could borrow more in my husband's sole name, but my dad is helping us with the deposit and will only do so if it's in my name as well.

japmis

Don't buy it unless you can afford it

Something else will come along and it'll give you more time to save

Lou67

bananz wrote: »

Sorry - yes I meant to type £85k lol! Our mortgage broker has already stretched the term etc. to the max and the only way we can borrow more is if my husband's work provide some kind of written confirmation regarding his overtime which he's doubtful they will commit to. It's just so frustrating to be so near yet so far!!

ETA: we could borrow more in my husband's sole name, but my dad is helping us with the deposit and will only do so if it's in my name as well.

Oh dear I don't know what to suggest then

Maybe if you go back to your mortgage lender and say you will have to pull out unless they can find a way of raising what you're borrowing by 5K, they may be able to come up with something. £5K is so little isn't it really, when you think you're spending £100K.

Just go back to your mortgage peeps. Obviously, if it's a no, then you'll have to bow out this time. But the prospect of you pulling out, may push the mortgage lender into doing something or maybe they may ask the seller to drop the price a bit more. The prospect of *them* losing the sale may make them drop it: unless they have other interested parties.

Good luck xxx

bananz

The stupid thing is that we *can* afford it in that the repayments would be significantly less than the rent we're paying now on a 2-bed flat and I'm planning on going back to employment by the end of this year once my twins get their funded nursery place and the baby I'm expecting next month is old enough to go to childcare. As I said, very frustrating!

Lou67

bananz wrote: »

The stupid thing is that we *can* afford it in that the repayments would be significantly less than the rent we're paying now on a 2-bed flat and I'm planning on going back to employment by the end of this year once my twins get their funded nursery place and the baby I'm expecting next month is old enough to go to childcare. As I said, very frustrating!

That's a funny one! My neighbour got turned down for a £75K mortgage - last year - which would have been about £450 a month, yet they were paying £600 a month rent! So they could definitely afford the mortgage payment. Guess it's because you are borrowing a massive amount of money, rather than just paying a monthly amount of rent (which would be covered by benefits if you couldn't pay.) It's still mad though: how it works...

chunkychocky

A mortgage repayment does need to be lower than a rental payment since you will also have the cost of the upkeep of the house to pay for, including potentially unexpected expenses like a new boiler.

I hope something comes up for you.

bananz

It is a bit mad - especially as they'd lend enough based solely on my husband's income without me on the mortgage, but with my (albeit small) self-employed earnings contributing to it, they reduce it!

Ah well, if we have to let it pass us by then so be it I guess, but I won't be able to accept it until we've tried everything we can as there aren't any other houses I even feel tempted to view at the moment!

Kayalana99

I would tell the seller that the mortage people won't raise the extra 5k and thier is nothing more you can do.

Give them 24hours to mull it over, if they don't accept the 100k THEN start looking at ways to finance the extra 5k

If they realise that you just can't go to 105k they will either accept the offer because they want to sell or stay on the market and cross thier fingers.

Obvouisly you can then lie and say the mortage people changed thier minds...if you manage to raise the 5k but for now stick with the postion your in and try and get the house down 5k....I mean maybe 5k is affordable to you repayment wise but it will make life easier being 5k better on your mortage anyway :-)

Sure thiers no way for a 90% mortage with someone else if not?

I know how what its like we signed our papers today! Waiting for exchange date but we gave her an offer and said look we can't go higher and she accepted...I wish you luck, and like I said don't worry to much about them rejecting the offer as the house will still be thier tomorrow!