Mortgage probability - FTBs employed and self-employed

CatchFazed

Hello all,

Potential FTB here with a mortgage question.

I'm in a permanent role with a salary of £36,500 (a relatively new promotion after a much lower salary) and my partner is a self-employed musician with over 7 years accounts, last three years making about £25,000.

I have around £7,000 on interest free credit cards which I'm currently paying off - should be finished by Feb next year. Have recently cleared my graduate overdraft and am now constantly in credit in my current acount.

We both have Student Loan Company loans outstanding - my partner has never paid anything off (so around £12k), I've got about £8k remaining.

We both have no defaults or arrears on accounts.

My partner has £10,000 in savings, I should have £3,500 by the time we apply next year. His mum has offered to help us with a deposit as an investment, though my parents can't contribute anything.

Two questions:

Do you think we would be accepted for a mortgage due to self-employed status and my previous debts (though no defaults/arrears and always being offered increased limits)?

How much deposit do you think we would be need to purchase a two bed flat (in this area around £230,000)? Ie, how much am I going to have to ask the MIL for?!

I know we can't get a completely accurate idea here, but any help you can offer would be great. We'll be heading to a broker this time next year to get a more accurate idea, but I'd like to know whether we're pie in the sky dreaming or we're really working towards something!

Many thanks

ACG

Previous debts are not a problem, presuming they were kept up todte and paid off before the mortgage if anything it should help your score.

As for the deposit/investment - this will cause a problem, 10-15% should be fine presuming you can show 3 years accounts.

CatchFazed

Thanks ACG.

I guess we should be aiming for around £35k deposit, plus whatever we need for fees - so maybe a loan/investment from the MIL of £25,000. Sheesshhhh.

Might have to try and up the savings a little more!

Gary123456790

Your mother in law will have to sign to say the money is a gift and she holds no interest in the property otherwise it will not be accepted by a lot of lenders.

Whether you pay her back later on is between you and her.

Gary.

CatchFazed

Thanks Gary - that hadn't even occured to me. I thought it would be included in the paperwork but it makes sense that they wouldn't want another person on the details.

I guess we'd have to draw up something separately saying it's a loan/investment? I would never skip off without paying it back (of course!) but I'm sure having it in writing that we'd pay her back would be better for all.

ACG

If/When you disclose this to the lender, theyre not going to accept it.

They do not want people not party to the mortgage having a say in the property.

CatchFazed

Thanks both - think it's best kept as an informal loan between my partner and his mum then, and listed on the mortgage as his part of the deposit (so not disclosed as a loan).

I assume lots of people must do this as FTBs?

Really appreciate your help here, thank you