First Time Buyers?

elsen_2

Hi there,

I am 26, with a credit rating that swings between "fair" and "good" (back in the good for the first time in a year, yay, up to 912!), one defaulted account since settled from 5 years ago. My partner is 30, with a "fair" to good credit rating as well (although not sure what his exact details are, rating wise).

A one bedroom flat with garden, garage and parking space for £90,000 has just come up in my area and my parents have offered to fund the deposit. We have an annual income of about £57,000 before tax (I'm on £24,000 a year and he's on £33,000 pre tax).

Before I get too excited, I just wanted to know - will we get a mortgage with only "fair" credit ratings? I don't want to get too excited only for the excitement to be pointless, as it were.

Thank you for any advice!

Sophie

kingstreet

Lenders pay absolutely no attention to these good, bad fair, or numerical ratings given by credit reference agencies. They are a money-making venture for the CRAs and are nothing more than indicative.

You can have a "999 credit rating" and be declined a mortgage because you have no job.

A £90k purchase price. You say a deposit being gifted, but not how much and loan to value probably has more relevance to the chances of a mortgage than anything else.

You also don't mention the size of the default, or when it was satisfied.

This is a details business. If you have not already done so, obtain the £2 paper copies of the credit files you don't have and put all three in front of a good whole market broker to see what is possible. At 95% this will be a more difficult to impossible job than it would at 75% when it would be relatively easy. The broker will get you a mortgage and at the best possible rate.

Equifax

https://www.econsumer.equifax.co.uk/consumer/uk/order.ehtml?prod_cd=UKSCR

Experian

http://www.experian.co.uk/consumer/statutory-report.html#orderReport

CallCredit

https://www.callcredit.co.uk/stat-report-online/index.php?action=basket_add&tpl=setRegister&package=63&amount=1&mode=clear

monty-doggy

Well I just got a mortgage on my own with a fair rating. It's not just the rating taken into account its also outgoings, debts, security of employment, affordability etc. see an independent whole of market broker, you will get a much better deal and they will find a lender to suit your circumstances.

Good luck!

elsen_2

Ah, rightio.

The deposit will presumably be 10% or 15%. I satisfied the default 5 years ago and it was only for about £50, on my student credit card.

I'm mostly just looking to know if getting a mortgage at ALL is something we can do, if it's likely we can we can look further forward at who and where etc etc.

Thank you

monty-doggy

I'm sure you will be fine. Up until last minute I was convinced they would reject me but I had the formal offer today. It's daunting, but the best feeling knowing I'm moving into my forever home in a few weeks!

R_P_W

What is your living situation now? Living with parents or renting?

Do you havevanybsavings for deposit and fees?

elsen_2

I have about £1,300 in savings, my partner has none. He rents at the moment, on his own, a two bed house. I live with my parents paying very low rent (just £100 a month, he pays £525 a month).

My parents are very helpful so will assist in any way they can I think. The deposit is covered by them so in an ideal world we would be using that for furniture and I suppose fees. It's a ground floor flat.

R_P_W

So if your on 24k and living at home why such low savings? And him none at all?

Bufger

Solicitors fees can be as much as £1000 for a half decent solicitor. You'll need conveyancing at £200 ish. Moving fees unless you're doing that yourself (even then renting a van costs money). Product fees for your mortgage, sometimes you can find a fee free product but it normally has a higher interest rate.

Most people say you'll need about £3k for just fees, the cost of moving etc. Then you'll need some furniture and any DIY materials to do the place up to a standard you can live in.

My First opinion: Dont buy a flat. People outgrow flats very quickly. If you get pregnant within the next couple of years you'll be stuck in a stituation where you dont have the money to move but your place is too small. Flats are hard to sell on etc etc.

My second opinion: Dont move until you have a reasonable amount of funds behind you. Get used to living on the amount you will be paying out on a mortgage and bills. At 26 and 30 if you have next to no savings and earn a combined £50k per year you will really need to have a look at your lifestyle and change it. Save some money if you want the responsibility of a mortgage and get used to what it feels like. Your saving potential is massive if you only pay £100 per month rent so it'll only take you 6 months to save a decent amount if you try hard enough. You also need to make sure your partner has the ability to save money, if you do the saving and he does the spending it'll cause friction down the line.

Lots to think about. Good luck

somethingcorporate

You living with almost no overheads, a good salary and NO SAVINGS would ring massive alarm bells for any lender and rightly so.

You should be able to put £1k aside per month, what are you wasting your money on? If you save hard you would be able to save your own 10% deposit in less than a year and be in a much better position, plus in a year your default should be off your credit file.

elsen_2

Wow, lots of "friendly" negativity here, thanks.

My partner spent 8 years in a relationship where he looked after himself, his partner who had "depression" and refused to work and her two teenage children. Yes, this was his mistake to make, and he is now paying for it. He has a large amount of debt, mostly credit cards, due to this. He has spent the past three years trying to get out of this debt, so his spare cash every month is spent on trying to pay off his debt.

My outgoings each month go on running a car, living 200 miles away from my partner and commuting to and from work. I also pay for all my own bills at home - phone, food, drink, pet insurance for three animals.

I don't understand how I would put 1k aside a month if my take home is 1,400 (I am paying in to a pension scheme as well as tax). I am also paying off my own credit card debts of £300 a month.

I will not be getting pregnant in the next couple of years. This is a fact. The flat has a garage, a garden and a second parking space. Moving costs are minimal (the flat is 3 houses down from my current home), furniture is all already bought (as my partner's house was unfurnished on renting and therefore everything in it is his). Tools are also not a problem, as my parents have all the tools we need and *want* to help.

Thank you to those offering advice, to those making derogatory comments, no thanks given at all.