Mortgage Newbie - A few questions!

Chromium

Hi Everyone!


I have to admit I have been a non-registered lurker on these boards a little while but I'm now in need of some friendly advice


Myself and my partner are making the first strides into the house buying world - treat me kindly! - and I have a few questions that I have tried for the life of me to find the answer to but had no luck so far!


I'll give you some background as to our current scenario:


- Joint income of £38,000 gross
- We have been saving between 2-3 years and currently have £25,000 (We are aiming to have £30,000 by September and have both consistently hit our individual ISA allowances each year).
- We haven't yet settled on our price range (still early days in the process for us) but I'm hoping for a 75% or 80% LTV mortgage if possible.
- I am now starting the process of checking the necessary credit files to make sure all is good, getting on the electoral register etc. etc.


There seems to be a big emphasis lately on lenders having a focus on 'affordability' when making decisions - looking at income and outgoings.


We are currently living with my fianc!es parents and this has been a fantastic help in building our deposit (We do pay our fair share in rent to her parents but our outgoings are obviously a lot smaller than they would be if we moved out). I have experienced 'living alone' having rented my own flat a few years ago during my student days so I'm not totally defunct in the 'independence' department .


Given the above there are a few points that I would be grateful to pick your brains on:

• Given we are not currently renting our own place, how would we be viewed by a lender when they are doing their affordability assessments / lending criteria? I assume they would find it difficult to make an assessment (We don't pay any bills / council tax / utilities ourselves) and I'm not really sure how they would view the situation.
• Do you feel it is a worthwhile decision to maybe rent a place together for a year or two to help with the above point or stick with the current living arrangements and build more deposit at a faster rate? (There would obviously be benefits for us as we would have a better idea ourselves of how we would manage our finances when we have regular outgoings and give us a realistic idea of affordability).
• The above wouldn't be too much of an issue as I am fairly confident we could still continue to save while renting (albeit at a slower rate). The key here is that I don't want to be dipping into the deposit fund.

Really looking for anyone who has knowledge or experiences of the above. In my searches around the internet I have not really found any cases where the above situation has been described.


Happy to answer any questions if there are important points that I've maybe missed!
Thanks,
C

Gonzo33

Hi,

The lender will look at what your future expenditure will be based on national statistics or what the broker tells them as long as they are realistic. For example if there were no travel costs because you both walk to work, etc then the broker would need to explain that.

I have written plenty of mortgages for first time buyers that have never rented. Most importantly they will look for voters roll, any credit that you do have is paid in full and on time. Stability in job and address history.

toothhurty

Hi Guys,

i've just signed up to this forum, which i have been recently referring to and it has helped me and my wife a great deal as well as easing some of our fears.

i'm hoping i can ask you all a quick question..

My wife and i have been dealing with a mortgage advisor from the MAB and when we first met him we were told that his fee is £395. £195 on application of the mortgage and £200 on completion. Fine, that is all reasonable i guess, the only reason we decided to use a broker is because i have just become self employed, after being salaried for the last 4 years (only just, 2 weeks ago). We found that pretty much every mortgage lender who would have lended to us a few weeks ago, no longer will.

the problem is, the mortgage advisor is now essentially telling us, that we either pay £395 and take out mortgage protection with him, or we pay up to 1% of the mortgage fee (which would be around £2000),

now the issue here is that he only ever mentioned £395, and now after paying a hefty mortgage application fee with Scottish widows (£1499) i'm being told take out a !!!!!! mortgage protection policy, or cough up 1%.

surely that's not fair? what if i don't want a mortgage protection polciy, and one offered by him? we really feel that we were mislead and are bitterly disappointed.

we're not sure what to do and we'd really appreciate your advice. thank you in advance

Thrugelmir

Chromium wrote: »

- We haven't yet settled on our price range (still early days in the process for us) but I'm hoping for a 75% or 80% LTV mortgage if possible.

What's the mortgage as a multiple of your income. This has more of a bearing on what you can afford to buy. Rather than the LTV in isolation.

Thrugelmir

toothhurty wrote: »

Hi Guys,

i've just signed up to this forum, which i have been recently referring to and it has helped me and my wife a great deal as well as easing some of our fears.

i'm hoping i can ask you all a quick question..

My wife and i have been dealing with a mortgage advisor from the MAB and when we first met him we were told that his fee is £395. £195 on application of the mortgage and £200 on completion. Fine, that is all reasonable i guess, the only reason we decided to use a broker is because i have just become self employed, after being salaried for the last 4 years (only just, 2 weeks ago). We found that pretty much every mortgage lender who would have lended to us a few weeks ago, no longer will.

the problem is, the mortgage advisor is now essentially telling us, that we either pay £395 and take out mortgage protection with him, or we pay up to 1% of the mortgage fee (which would be around £2000),

now the issue here is that he only ever mentioned £395, and now after paying a hefty mortgage application fee with Scottish widows (£1499) i'm being told take out a !!!!!! mortgage protection policy, or cough up 1%.

surely that's not fair? what if i don't want a mortgage protection polciy, and one offered by him? we really feel that we were mislead and are bitterly disappointed.

we're not sure what to do and we'd really appreciate your advice. thank you in advance

Welcome to the forum.

Best to start a new thread rather than adding to a current one. As all gets very confusing to read.

Go to the main board for Mortgages and Endowments. Towards the top on the left hand side click New Thread.