FTB with complicated situation

SLH312

Myself and my husband are looking to purchase a property at 385k and have a meeting with HSBC next week to discuss a mortgage. We have 20k in savings and I am selling a share of a business I own and will pocket approx 80k after tax, so will have a 25% deposit.

My husband is paid 35k per year plus overtime and has 7500k on a credit card and car finance of £365 per month.

I am paid on a profit share only basis and this tax year should get approx 110k before tax. I take home between 5500 and 8000k per month and the mortgage would be approx £1170 pm at 75% LTV. I do have some late payments on my credit report dating back a few years, no recent ones and have no financial monthly commitments and 0 on any credit accounts I have.

I have approached HSBC as two colleagues (in the same profit only pay) position as myself have obtained mortgages with them in the past 6 months. My Mum is also a Premier customer with them and recommends their service.

I have a few questions/worries:
- will my late payments effect the application?
- should we pay off my husbands credit card?
- is 385k too much for a FTB? (we are hoping to future proof and stay there for a very long time)
- would a bigger deposit increase the chances of approval or is 25% sufficient

I am so worried that I am already loosing sleep and we haven't even started the process yet so any help or advice would be greatly appreciated :-) .

ACG

- Yes (But with 25% deposit maybe not a enough to get declined - HSBC seem to vary their stance from applicant to applicant going off some of the posts on here).
- Will this impact on the level of deposit and most importantly the LTV? If it will take it above 75% then probably not.
- Only you can decide that. I live in Manchester and you could probably buy a 3-4 bed semi/detached in a nice area for that or a street for half of it!
- Yes, but at 75% LTV you should be fine.

One big thing that stood out was that you are selling part of a business you own in order to raise (part of) the deposit. Once this is sold, what will happen to you income?

EDIT:
Can i suggest you speak to a broker? They cant usually deal with the likes of HSBC/First Direct but it might be worth paying a slightly higher rate and having someone look after it for you and take the stresses away.

getmore4less

Wait a year live of the £35k hubby gets and have a 50% deposit.

If you have been pulling in £100k a year where has it gone?

or is this the first year with no track record/history?

SLH312

Thanks ACG for your help :-)

My income will effectively drop by 20% once I sell the shares but in the past 3 years my income has increased by between 25-100% per year as the business is growing rapidly so I would expect for it not to actually make that much impact as it should continue to grow anyway, effectively I may end up taking home about the same amount next year as this year.

I live in the North West not too far from Manchester and the property we are interested in is a 5 bed detached in a desirable area, as I said we are planning to stay there for a very long time and make it our home.

The only reason I have gone to HSBC is because anyone else I have spoken to seems to see my job as an issue where as they have given mortgages to my two colleagues and understand the business and how it works, also thinking them knowing the business may make the selling of shares a more straight forward process too.

SLH312

getmore4less wrote: »

Wait a year live of the £35k hubby gets and have a 50% deposit.

If you have been pulling in £100k a year where has it gone?

or is this the first year with no track record/history?

As I have just posted in another reply my income has jumped massively over the past three years so I have not had this level of income for a long time. We also got married in December last year and that took up a big amount of spare cash. We only started saving this year because it was the first time we really could. To be truthful we were originally going to buy a much cheaper house but with the option to sell some shares coming up at the same time as stumbling upon our dream house it just opened up some doors.

ACG

That really limits where you are buying then as there are not too many places in that price range around here. Im going to have a stab at Bramhall/Wilmslow way? (Its ok, i dont expect you to say where on an open forum).

If its a one off purchase then you could argue the extra you are spending now will be saved in future house moves/stamp duty etc.

If HSBC are prepared to look at it then im sure others are - HSBC are not renowned for their lenient underwriters. At 75% LTV im sure there will be a few options even if HSBC do decline it for whatever reason so i would not be worrying too much if i were you.

SLH312

ACG wrote: »

That really limits where you are buying then as there are not too many places in that price range around here. Im going to have a stab at Bramhall/Wilmslow way? (Its ok, i dont expect you to say where on an open forum).

If its a one off purchase then you could argue the extra you are spending now will be saved in future house moves/stamp duty etc.

If HSBC are prepared to look at it then im sure others are - HSBC are not renowned for their lenient underwriters. At 75% LTV im sure there will be a few options even if HSBC do decline it for whatever reason so i would not be worrying too much if i were you.

Bit further out than that :-) thanks for your advice though, I really appreciate it!