Affordability Calculator

Kc1983

I'm really confused and miffed off with the new affordability calculator. I don't get it at all. I've put £80 travel costs per month with Nationwide offered £99,100, took it off and it goes up to £111,000. How can this be right?

carolineb23

Because if you weren't spending that £80 a month on travel costs, you would have available money to spend on a mortgage, therefore you can afford to borrow more.

amnblog

It goes to prove that affordability calculators are not simple beasts

Kc1983

So spending approx £960 a year equates to being lent over 10,000 less. I hate these calculators! It's not just the petrol either, anything you put into it multiples it so you can hardly lend anything. We got a dip in Feb for £97,000 now we would be lucky in getting 45,000.

amnblog

The extra £960 could be tipping your total outgoings over a threshold which impacts on other factors in the calculator.

Kc1983

I just can't believe the change in lending in the space of a couple of months. It's really damaged our chances of buying a home. There must be lots of people this is effecting. Is there no other way?

amnblog

Not legally.

The FCA believe MMR will not damage your chances of buying a home but will increase your changes of keeping it.

Clearly the changes will cause a number of applicants to have to rethink their budget.

Kc1983

We have a £30,000 deposit and want to buy a home worth £120,000. No chance at all. We would be lucky to get one £75,000. It's really crushing.

HappyMJ

Kc1983 wrote: »

We have a £30,000 deposit and want to buy a home worth £120,000. No chance at all. We would be lucky to get one £75,000. It's really crushing.

You do have a chance. One way to get around the affordability calculator is to set the loan term to the maximum you can. 40 years may be possible if you are young enough. Set your retirement age to 70 (even though in reality you may want to retire at 60). Then if you afford it overpay the mortgage and you should be able to clear the mortgage in half the time or the original time that you wanted anyway. A £90,000 mortgage (over 40 years) should require about £600 disposable income per month so reduce your expenses so you have that amount available each month to pay towards the mortgage.

Kc1983

My husband is 38. It's just not going to stack up.
How honest do you have to be on the calculators?

~Beanie~

Kc1983 wrote: »

We have a £30,000 deposit and want to buy a home worth £120,000. No chance at all. We would be lucky to get one £75,000. It's really crushing.

£120,000 less £30,000 means you need to borrow £90,000. You said earlier that Nationwide offered £99,100 - that's enough isn't it?