Could we get this level of mortgage?

Alarae

I have been looking at various affordability calculators but they seem to give vastly different numbers.

My partner and I are hoping to get a house next year, but unfortunately the area is expensive and we will be looking at £250,000. We will have £50,000 deposit, gifted from his dad.

His income: £23500 (+bonus, this has been around £1000 the past couple of years)
My income: £18000 (+ quarterly bonus, has been an extra £650 every three months)

I know we will be looking at a mortgage of around £200,000 which will be pushing the salary multiples a bit but would we have a shot?

Neither of us have any debt (mine is at 0% and i will be paying it all off in January once my fixed savings mature) and the only commitments we have are £20 in phone bills. The cars are fully paid off and insurance has been paid off annually.

We would look at smaller places but ideally we would love a 2 bed place so family can stay and an actual house for the garden!

ACG

Alarae wrote: »

Neither of us have any debt (mine is at 0% and i will be paying it all off in January once my fixed savings mature)

Thats a contradiction, either you do or dont. Assuming it will be paid off in January prior to any mortgage completing then its not a problem.

The amount lenders lend does vary and sometimes by quite a bit.

£200k (5x income) should be achievable but not with all lenders. You are pushing the upper limits there.

amnblog

Affordability cannot be accurately assessed without knowing your full outgoings.

You probably need to hone your requirements as £200,000 sounds too ambitious. Somewhere between £160,000 and £195,000 would be my guess depending on the lender and your overall situation.

Alarae

ACG wrote: »

Thats a contradiction, either you do or dont. Assuming it will be paid off in January prior to any mortgage completing then its not a problem.

The amount lenders lend does vary and sometimes by quite a bit.

£200k (5x income) should be achievable but not with all lenders. You are pushing the upper limits there.

Ah, I know it is a bit contradictory but essentially this balance in my credit card will definitely be gone in January before any mortgage application.

If we managed to look for a house last year then we could have found one in our area for 235k but house prices have gone a bit silly where we are at the moment!

Looks like we may have to downsize our hopes a bit. In terms of outgoings we probably spend around £150 on food and the same on petrol between us, then maybe an extra £50/100 for fun.. Sometimes! We are a boring couple, which has its financial benefits!

I think we just may have to hope something cheaper will come along that ticks all the boxes!

ACG

Have you got ch4 on?

Alarae

ACG wrote: »

Have you got ch4 on?

Ironically, yes! Unfortunately we live in Reading which is considered to be in the commuter belt to London which seems to have pushed house prices up in the past few years we have been here.

I'm starting to think I should have chosen to live up north..

ACG

People down in London need a deposit for what my host cost to buy!

somethingcorporate

Save up a bit longer if you can?

Thrugelmir

Alarae wrote: »

We are a boring couple, which has its financial benefits!

Why no savings of your own then?

jimjames

Thrugelmir wrote: »

Why no savings of your own then?

Good point that you'll also need the costs of moving and stamp duty to consider as well as emergency funds for any repairs.

If you're on the limit of affordability then it may go against you if you're not able to save already. You may want to check your budgets and find what you do spend money on as it must be going somewhere if it's not on the items you listed.

Alarae

Thrugelmir wrote: »

Why no savings of your own then?

We will be using those for fees, stamp duty and all that jazz. If we have over and above what I think we need then we will plug that into the deposit.

Unfortunately I have only just graduated from university and got this job while I figure out where I want to go. The savings I did have went on my car a year ago... In hindsight I should have bought a cheaper car but I am not looking to change this car for years.

We were looking to save for the next 18 months but as a family member said they could help us out so we can get on the housing market sooner we leapt at the chance. As it stands our rent would basically match a mortgage payment on a house we are looking for!

We understand we most likely won't find somewhere straight away, so our savings should steadily build each month and we will be able to contribute more to the deposit side of things. I would have had a little extra myself but I need to use this to pay off a credit card on 0% which I took out to help my sister. She has been paying this off but unfortunately won't be clear by the time we may possibly apply for a mortgage so I'll have to clear it and she pay me back monthly.

In an ideal world we would save longer to make it more comfortable but house prices are steadily getting out of reach and I'm not sure we can save enough to outstrip the increases