Mortgage advice

Redimp_3

Hi everyone!

This is my first so please be very gentle with me!

I've been lucking for a while and read some excellent advice which I've used for my own situation and needs.

This time I was after some advice and hopefully I can get an answer to confirm if this is an option or not.

Basically me and my wife have moved into a new part of the country and we are currently in rented accommodation. We have found a house we would like to buy but I'm not sure if we can get a mortgage for it. This is where I need some advice. Can we get a mortgage or not?

Our situation:

I earn £27k a year and my wife doesn't work. Take home is around £1600 per month. We have 2 kids under 5, that's why my wife is at home because childcare is stupidly expensive!

We own a property that we rent out and the rent covers the mortgage and insurances plus around £50 extra per month. We will be keeping this on as there is only a small amount of equity in it and we have a long term good tenant.

We have £20k to put down as a deposit and the house we want to buy is for sale for £160k.

We don't have any credit cards but I have a personal loan which I pay £250 per month and the current outstanding balance is £13k.

The question is, will there be any mortgages out there that would consider us? Would we be able to use a parent as a guarantor?

What are our options? Is it a non starter?

I hope I've made sense! Any help, advise or guidance would be great.

Thanks red imp

ACG

I dont think this will work.
If you didnt have the loan, i would be saying you might be able to get borrowing around £120-130k. With the loan and technically 3 dependents that will come down.

Does your wife/you receive any tax credits? If so could you detail them and how much?

Guarantor mortgages are more for first time buyers, there arnt that many of them around, ive never had to use one for a homeowner, so im not sure what the criteria is but i imagine that it wouldnt get looked upon too favorably.

Redimp_3

Thanks for your response.

We don't get any tax credits. We have been told we earn too much?!?! We just get the £30 or whatever per month family allowance.

I only ask about guarantors as I noticed there are a few new types of mortgages available. I guessed they were for ftb but I had a slight hope that it might extend to people that are moving up the ladder.

Could I get a joint mortgage with a parent or, because they won't be living in the property, be a no no? My parents are mortgage free and at least 10 years from retirement and have a combined income of £50k. I could afford the mortgage repayments as our rent is £825 per month. I would only add them to hopefully help us get a mortgage, if u see what I mean.

I guess that it looks like we are going to miss out this time, unless my parents income could be used.

I will have to send the wife back to work and pay off my loan!

Thanks again, but any more advice would be good.

Redimp

katejo

Also are you paying the tax on your rental income from the rented property? You can only offset the tax on the mortgage interest not on the whole mortgage income.

Redimp_3

Yes, I do a self assessment each year and only the interest.

I declare the 'profit' when the tax credit renewal comes and each year it comes back with nil entitlement!