Loan to cover moving costs?

japmis

Hi I'm a FTB and the lease runs out on my shared rented house on August 4th. I'm desperately saving every penny to get a mortgage together and whilst I can make a 10% deposit, I'm starting to panic about all the other costs like stamp duty, solicitors, removal van etc. I don't have any family that can help me financially so I have to fund everything myself.

If I take out a loan for say £3k to cover these costs, will this scarper my chances of getting a mortgage?

Should I apply for a loan now or wait until I've got the mortgage approved?

Is it possible somehow to add these costs to the mortgage?

Thanks in advance

Japmis
(30/female)

kingstreet

No. You can't add them to the mortgage.

No. You should not wait until the mortgage is approved. Standard advice is not to apply for any new credit from the point you apply for the mortgage until after it completes.

The monthly cost of a loan will be factored-in to affordability. For example, a £100 per month loan repayment will see your borrowing power drop by £4,800 if you use a lender which offers 4x salary. As long as the mortgage remains affordable, you should be able to borrow what you need. Use lender affordability calculators to check.

japmis

Thanks kingstreet; I'm not maxing my mortgage limit so I hope I'll be ok. My mortgage adviser has suggested I could get up to £200k if I had a deposit to match, but I don't and I don't want to stretch myself either so I'm budgeting for £150k house price value.

19lottie82

what's the rush? have you even got mortgage approval and found a property that you want to buy and can afford yet?

there are plenty of problems that can "trip you up" along the way, so to achieve the above and then have a move in date for mid august, is a big "what if" in my opinion.

surely it would make more sense to move in to another shared house, or somewhere as a lodger, where you can get a month to month contract, then you can save up the extra £ that you need and make the right choice in purchasing a property, rather than making a mistake and/or ending up in additional debt?

japmis

I'm viewing about 3-4 properties a week, and I have a second viewing today on a property that I like. I've put off applying for a MIP until my pay rise in April, altho that isn't the be all and end all if I find something I want to put an offer on before then.

I'm planning to be long gone before August; the other tenants all have parents they can move home to for a stop-gap but unfortunately I don't have that luxury. We have to give 2 months notice on the house; the 4th August is the drop dead date when my housemate's new build is ready.

I have furnished the house myself so moving to another house share would be very tricky, especially as I have a cat in tow, it's not really an option. (Not to mention house sharing for over a decade, I'm fed up with fighting over loo roll!)

I could move to another rental on my own for 6 months but that really would be worst case scenario "about to be homeless" option. Moving house once in a year is bad enough, but twice might push me over the edge. Plus having a string of addresses on my credit report isn't great, and I've only been in my current house for 15 months as it is.

Thrugelmir

japmis wrote: »

the 4th August is the drop dead date when my housemate's new build is ready.

This is far enough into the future to suspect that this date may well be moved back.

japmis

Thrugelmir wrote: »

This is far enough into the future to suspect that this date may well be moved back.

This is a concern, yes, but I'm not in the pisition to let her dictate my schedule. I can't risk not having some place to move to :-/

I understand that if she completed September / October then it would buy me more time but I really don't want to consider a rental unless I HAVE to.

MikeR71

I don't know but could you arrange an overdraft with your bank on your current account? Someone could correct me if I am wrong but an overdraft facility can be considered cleared funds and can be used to pay for the extras such as lawyers fees and stamp duty.