Some q's re: graduate mortgage, credit history etc

petrapan

We have had a mortgage for 8 years with a high street lender. We have £35k outstanding and expect to sell our home for £110k. When we took out this mortgage, we had one income and very little credit history.

We are both now graduates, both beginning a PGCE next month, and will qualify as teachers next year and begin our NQT years. Neither of us were graduates when we took out our original mortgage. Our credit history is complicated- no mortgage arrears or late payments at all in the last three years, but previously we had some late payments and my husband had defaults (settled). We had no mortgage arrears, though. The credit agency sites are still saying our credit history is only fair, despite our good history for the past three years I presume this means that the problems we had more than three years ago are still affecting us now, which is a real shame.

We plan to move house in a couple of years, but are trying to get our heads around what might be available- we don't want to have pipe dreams that turn out to be unworkable. Would we be best to remain with our current mortgage company considering our credit history? Can we get a better rate if we apply for some sort of graduate mortgage (do these still exist? ). What sort of multiple of our joint wages are we likely to be offered? I know it varies, but we literally have no idea of the normal range.

We expect to be earning around £40-45k between us when we apply, and will have equity of around £75k. We also have children so receive tax credits and child benefit etc, although I don't know if this is considered "income" for mortgage purposes.

Obviously we will enlist the help of a mortgage broker nearer the time, but we are just looking for some sort of ideas to play with in the meantime. Any advice or experiences at all would be interesting and most welcome.

JoeK_3

Based on your joint incomes you will be able to go for a mortgage in excess of £200,000 and with your £75,000 as a deposit, you should be able to buy a property of say £300,000 at today's value.

Graduates mortgages are still available and it could be one of the options that you may want to consider at the time of looking.

Adverse credit history is clear after six years but lenders are not too bothered about past problems as much as present difficulties.

You will be doing the right thing by contacting a whole of market mortgage broker as they will be able to find the best deals to suit your circumstances at the time and your present lender should be one that should be considered.

JoeK

petrapan

Thankyou so much for that, it's very helpful :beer: