Really low mortgage offer.

f0xh0les

We sold our house in Manchester last year and have been privately renting for the last 8 months and have started looking for a new house.

We have a 50k cash deposit and are looking at spending around £200k total on a house so max 75% ltv.

Husband's salary 42k, I am currently SAHM until all 4 kids settled in new schools etc then will pick up something part-time to keep me out of trouble.

Just came back from our previous mortgage lender who said they would give us a good deal within 12 months as previous customers, and their maximum offer was 101K

The only thing we can think of is that there is a 2 yr probationary period (reduced from 3 yrs because they really wanted him for the job).

We were kind of expecting a 3x / 3.5x salary offer.

Are we being unrealistic?

marksoton

f0xh0les wrote: »

We sold our house in Manchester last year and have been privately renting for the last 8 months and have started looking for a new house.

We have a 50k cash deposit and are looking at spending around £200k total on a house so max 75% ltv.

Husband's salary 42k, I am currently SAHM until all 4 kids settled in new schools etc then will pick up something part-time to keep me out of trouble.

Just came back from our previous mortgage lender who said they would give us a good deal within 12 months as previous customers, and their maximum offer was 101K

The only thing we can think of is that there is a 2 yr probationary period (reduced from 3 yrs because they really wanted him for the job).

We were kind of expecting a 3x / 3.5x salary offer.

Are we being unrealistic?

That's a pretty harsh employer!

I'd say broker all the way.

f0xh0les

With a University employer, it is pretty standard.

Also we have no outstanding debt, all credit cards paid off, on time, in full, I thought we would be a good risk.

alchemist.1

The 4 kids are more then likely reducing affordability and you as a dependent too.

marksoton

And you may well be. But the only way you'll find out is to put all the facts in front of a good whole of market broker.

Don't feel any loyalty to a previous lender.

Lungboy

f0xh0les wrote: »

With a University employer, it is pretty standard.

I'm not sure how true that is, the university I work for has the more usual 6 month probation. Academics also have to do an HEA teaching qualification which can take up to a year. Initial contracts are often for only 3 years, but that's different to the probation.

E: did they do a 2 year fixed term contract with a promise to make it permanent at the end of that term?

uncreative

3 times salary is [42 x 3] = £126k. From that, the affordability based on having 5 dependents (you and 4 kids) will reduce that maximum offer so £101k offer of mortgage is actually not that much out of the ballpark.

Definitely a broker case to make sure the lender is right. Why dont you continue to rent until you are earning. Provided your wages are higher than the lenders minimum (varies, but think £10k to £12k pa) you will come off as a dependent. Also, at £42k is the child benefit also being taken into account as other income? Some lenders may do this.

amnblog

Unless you have £500 PM of unsecured debt repayments going out every month the affordability calculation you have received is miles off the pace.

Forget your current lender and engage a mortgage broker.

f0xh0les

Lungboy wrote: »

I'm not sure how true that is, the university I work for has the more usual 6 month probation. Academics also have to do an HEA teaching qualification which can take up to a year. Initial contracts are often for only 3 years, but that's different to the probation.

E: did they do a 2 year fixed term contract with a promise to make it permanent at the end of that term?

It is a permanent lectureship contract, but instead of the usual 3 yrs, as a sweetener they dropped it to two. He already has enough lecturing experience to not need the teaching qualification.

f0xh0les

We were working on a budget of around 180k, but up to 200k. It wasn't ever going to be the 'forever house' this time around, but still, after having had a mortgage, paying more than double in rent is grating, although nice to know we will easily be able to overpay by a sizeable chunk a month.
Thanks for all your wisdom. You have been really helpful.

f0xh0les

Child tax is just over £30 a week so £1.5k and Child Benefit is £3k, thanks for that, I would not have thought to add it on.