Mortgages, where to begin

Zola.

My partner and I are beginning to talk about mortgages and I was hoping to get some advice here from those with experience before speaking to someone official like a banker etc.

At the moment we have combined savings of about 30K, with a combined annual salary currently at 50k. My girlfriend has a base salary of 25k, but she gets commision on after sales, so sometimes her pay can be over 2k a month if they do well.

She is a good saver, I am ok. I can roughly save 1/3 of my pay a month if I behave (a little over 500 quid).

Our rent runs out in August. It would be nice to have moved into somewhere by then, but I am not sure how realistic that is, I know these things tend to take a lot of time.

Are we best finding a house we really like and then going to someone official?

Also, what do you reckon we can afford? I was doing a quick browse and from what little I know I guessed around 160k would be our limit to be able to still enjoy life!

I would prefer to be in a mortgage between 15 and less than 20 years if possible.

Any thoughts are much appreciated

engineer_amy

things have changed since I got my first mortgage in 2009, so other people may be able to steer you on the right course, but my action plan would be to see an independent broker who will discuss the affordability criteria and based on income, savings, outgoings etc may be able to give you a ballpark figure of what you can afford. Then you can start looking at houses in this price range. I would hate to view a house, fall in love with it then find out it is well beyond my financial reach once you start applying for the mortgage. In terms of timescale, I started looking at properties at the end of January, found my ideal house within 3 weeks, offered, accepted, mortgage applied for by the end of march, contracts signed at the start of april (bought my sofa on 10th april!!) then my completion date was 18th May. This was Northern Ireland, and mortgage was through Ulster Bank, I don't know how this timescale compares with typical processes in the rest of the UK.





Also as you have a bit of time before you have to leave your current rental, I would start making sure all your financial affairs are in order, clear up any lingering credit card debts if you can (ones that aren't being paid off in full each month) and if you haven't already, get copies of yours and your partner's credit files from all three CRAs (£2 statutory files from Experian & Equifax and free from call credit/noddle) and check there aren't any nasty surprises lurking, which you will now have time to sort out.

ACG

As a ball park you can borrow around 4.5x your basic income. That may be reduced if you reduce the term but it gives you a starting ball park figure.

Any bonuses/overtime would usually need to be evidenced in some form or another and lenders would typically take half of it and then multiply that by around 4.5x also.

The whole process from finding a property to picking up the keys takes around 3 months so August leaves you more than enough time.

I would suggest speaking to a broker, completing a factfind with them. They will give you an idea of what you can borrow based on your whole situation (you have given us the basics but the more info the more accurate).
Your then free to go and look for a property in your own time knowing whether you can get the mortgage required or not.

getmore4less

Start with a SOA for your current income/outgoings.

Then do another as if you had bought a place.

The shorter the morgage the higher the payment.
Bills will change
You need to factor 5-10 years ahead for bigger spends like cars

Do some what ifs to work out what you would be comfortable with.