Natwest - Dreading Affordability Check

barker196

We've accepted an offer on our 3 bed and are looking to buy a 4 bed. Current mortgage is with Natwest and only a few months ago entered into a new 2 year deal so don't really want to leave them or would have to pay the exit fees.

Before starting this moving process I got an agreement in principle from Natwest about how much they will lend us and have had an offer accepted on a property based on that figure plus the equity we currently have.

Rang Natwest last week to meet a personal mortgage adviser but its a 2 week wait and told to expect a 2 hour meeting. I'm dreading the affordability questions so would appreciate any help from anyone with experience of what they might ask me and is there much of a chance they will reduce the amount they offered in principle? Do Natwest go through bank statements?

Any help appreciated.

DevCoder

With the new rules, Natwest are stricter.

They will expect you to be able to show that you could meet repayments at a 7% rate (their "worse case" scenario).

They will also perform an I&E with yourselves, if you already bank with them then they will go through bank statements, else they will probably ask for 3 months worth.

They will expect you not to have gone overdrawn for 3-6 months, their view of keeping your accounts "in order"

barker196

Anyone been through one of these recently? I spend £37 on mobile phone contract, £500 on shopping, £200 on petrol. It's a hypethetical question but is this likely to have an impact? I'm pretty worried the house we've had an offer accepted on based on the mortgage in principle is going to be jeapodised. 2 weeks for an appointment is a lot of worrying time!

Edi81

Spending is relative to how much you earn and personal circumstances.

Without knowing your salary and if you have any dependants it's impossible to say if those are excessive.

nearlyrich

If you do the budget planner recommended on debt free wannabe you will be able to work out how much slack you have in your budget...£500 on shopping ..groceries? is a lot but it depends how many you are feeding. You can also downgrade things like Sky and telephone contracts.. Personally I would rather live in a house I can afford whatever happens but seeing the real picture of your finances is a good idea for anyone at least once a year. Do two budgets one as you are now and one in the new house with maybe bigger utility bills council tax etc..

Thrugelmir

What's on your bank statements that concerns you?

barker196

Thrugelmir wrote: »

What's on your bank statements that concerns you?

No XXX rated subscriptions lol. Just everything really. Live to your means so I draw money out to spend with my kids on their bike hobby such as days out etc, the odd take away, car servicing, things for the house, clothes etc, savings. Things that could be cut back to afford a bigger mortgage.

Also Gas and electric, car loan, water companies, mortage protection, mobile phone, council tax, hair cut, home phone line and broadband.

Basically I'm looking to get a mortgage which is an extra £400 per month but don't always have £400 left at the end of every month if you get me.

Edi81

barker196 wrote: »

Basically I'm looking to get a mortgage which is an extra £400 per month but don't always have £400 left at the end of every month if you get me.

Now that is going to be a problem!

Remember, the mortgage is £400 a month extra at current interest rates. Even if you fix that will come to an end eventually and rates are inevitably going to be higher still.

nearlyrich

I would be very careful OP if interest rates rise, and they will, just how much more than £400 might you need to find? Better to be financially comfortable in a smaller place than over stretched and miserable in a house you just exist in...

Horseunderwater

Why do you need to move from a 3 bed to a 4 bed house? Can you not do a loft conversion or extend sideways or at back to get the extra space. My maternal grandparents brought up 7 children in little more than a 2 bed shed that he built out of wood & lined with asbestos panels - he scraped by & died when I was 2 1/2.
Seriously - you need to gather up a TRUE statement of affairs. Work out what luxuries you either do not need or can downgrade somewhat & know where every penny gets spent. Use the mortgage calculator on this site to do the affordability tests & if you cannot comfortably afford it now stay put.

Edi81

Horse underwater - how true. In years gone by you had whole families in small properties. Why does everyone think that they automatically need to move to a bigger property?