Another Affordability Query

mhill11

Hi all,

New to the forum although lurked around for a bit. Just looking for some advice on affordability and if it is realistic. Looking for a 30 year mortgage in October time of about £245-£260k on a max £400k property (so roughly 65-70% LTV) as will have a deposit of about £140k-£155k from selling my property. We're both in our early 30s and have joint wages of £60k. I'm aware this is just above 4x income which is perhaps the top end of what lenders are happy with so potential hurdle but with afforability being another factor too, would be interesting what you guys think.

- Stamp duty/legal fees/application fees for the sale and purchase all covered. There should still be £20-30k in savings left after the sale which I would prefer to not use as would more than likely want to do some work on the future property. However shows I won't be on the limit.
- Credit card balance at 0 (paid off every month)
- Car loan of £70/month finishing in December this year so presuming this won't be taken into account. Not allowed to pay off early.
- No other loans
- No dependents and no plans for children (not quite sure how you prove that!)
- No gym/tv subscriptions
- No mobile phone subscriptions (free work phone)
- Internet bill reimbursed by work
- Partners credit history is fine. Mine was too the last time I looked although will get an up-to-date report soon.
- Rarely go out/holidays, certainly nothing on any bank statements this year. Yes our bank statements look pretty 'boring' but we both enjoy life the way we live.
- Will be a house so no service charge/ground rent

Income after tax = £3800/month

Combined monthly costs: Pension £230/month, life/accident insurance £40/month, predicted council tax £140/month, travel incl all car costs £250/month, food £250/month, utilities £70/month, buildings/contents estimated £50/month = £1030/month

Using mortgage at the higher £260k figure and at 7% = £1665/month

So about £1100 leftover each month when at 7% rate.

All costs can be proven on bank statements although have upped the utilities/building insurance as they will very likely be more.

I have been on intermediary sites and the majority say it is affordable but just looking for a 'humans' advice!

Be grateful for any opinions

Thanks

sleepyshell

Hi

We have just received our mortgage offer and have similar figures to yours. Main difference is the house price and LTV. We are having 95% LTV on a property worth £257k, so borrowing £244k. :eek:

We're a few years older than you. Income is approx the same, we have a car loan of £159 per month ending January, both of us have contract mobiles but other outgoings look similar to yours.

My calculations only show that I have £300 per month left, but in my spreadsheets I added in a monthly figure to save for birthdays, christmas, car maintenance, etc. I just have to make sure that I transfer this to the savings account each month so that we don't fritter it away! It's quite a big step from what we are currently paying, but we know the move and expense is the right thing for us.

I think our bank statements are quite boring too...although I do have flights and hotels on mine over the last few months but that's purely travelling to Belfast for work so nothing fun!


Good luck!!


Oh, I don't recall anyone asking us to prove we had no plans for children!!

antonyc79

Our situation is similar combined salary about 62k but higher pension payments of about £650 combined and two kids. We just scraped affordability on a woolwich mortgage ( aip ) of 237k on about 49% ltv but they had to take child benefit of 136 a month into account for it to fit. So might be at the upper end of what they consider affordable.

I know woolwich only used pension and council tax as outgoings ( and loans etc but dont have any ) didnt ask about phone bills holidays etc as i think their system calculates all this for you.

mhill11

Thank you both for your input. It is a bit more reassuring to know that the figure isn't so far out of reach although I know it can vary widely from lender to lender. Well done on the offer sleepyshell!

We're going for a 30 year mortgage to maximise chances of being accepted although I intend to overpay immediately as if I was paying a 25 year mortgage.

In my circumstances I actually would prefer if they did ask for mobile bills as that figure is £0 as opposed to one they might assume it to be! Every little bit helps

Hope all goes well with the mortgage application antonyc79

Thanks