How much deposit to save for FTB?

koloko

Hi all

I would like to buy a house at the end of the year as a first time buyer.

I am 34, my wife 29, I would like to borrow £230,000ish. Our situation is below:

My salary: £44,000
Wife's salary: £31,000
Debts: None (occasionally use overdraft)
Savings: None
Wife's credit history: Clean
My credit history: Bad in 2004 and 2005 (2 missed credit card payments, large debts to income ratio - £40k debts, £20k income at time) however everything has been clean from 2006-present day. All debts were paid off in 2011.

Because of my problems in 2004/5, my bank did not allow me to own a credit card from 2008 until last year, and even now I can only get a limit of £800.

We have the ability to save approx £2,000 a month for a deposit.

How much should I consider saving before approaching a mortgage advisor?

Thanks in advance.

Thrugelmir

Have an informal chat with a broker now. As they'll be in the best position to review your circumstances.

The larger the deposit, the lower the LTV. Accordingly the better the interest rate.

If you can save £2k a month then shouldn't be an issue to hit the target within a reasonable amount of time.

koloko

Thanks. I will book a meeting.

I'm just looking for a ballpark figure - I know nothing about FTB deposit %s. I was told they start at 20% for todays FTBs - meaning I would need to save £46,000. Is that right or is it a bit high?

R_P_W

Normally would say miniumum 10% of the purchase price for a deposit, with some of the finanical history you have explained you may need 15% ideally 20% (plus fees, stamp).

If you can really save £2k a month then thats great as you are then looking at 1-2 years of saving

koloko

20% is about right then?

Thanks for your help. Saving £2k a month doesn't sound like fun to me but at least I know it is what's necessary.