Chances of this income multiple- FTB

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Alphabet89
Alphabet89 Posts: 21 Forumite
in Mortgages & endowments
Hi all,
Waiting for the tax year to end so i can submit 1st year self employed accounts- change in structure of work pay.

Looking at new build and using H2B.

I plan to do the following:

Purchase price £215-£220k
deposit -10%
H2B - 20%
Mortgage 70%
No o/s credit (car lease to finish) at time of completion and no defaults at all
Income multiple of mortgage is 3.75- just wondered whether it looks like a possibility.

If i put 5% in the multiple works out at 4.0 Income multiple which would leave more spare but higher repayments.

Thanks in advance

Comments

  • amnblog
    amnblog Posts: 12,456 Forumite
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    Maximum multiple is 4.5
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • bobothebear
    bobothebear Posts: 132 Forumite
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    Well I've just exchanged contracts on 4.7 multiple
  • Thrugelmir
    Thrugelmir Posts: 89,546 Forumite
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    bobothebear wrote: »
    Well I've just exchanged contracts on 4.7 multiple

    Are you self employed?
  • amnblog
    amnblog Posts: 12,456 Forumite
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    Maximum HTB multiple is 4.5
    I am a Mortgage Broker

    You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • kingstreet
    kingstreet Posts: 38,784 Forumite
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    The notional cost of the equity loan is 3% and that is taken into account in affordability. As do ground rent and service charges, childcare, dependents, maintenance etc.

    So not just credit costs.

    I can think of only one lender which might look at a one year SE case on HTB Equity Loan and where we have used this, we have had a number of post-application questions and requirements above and beyond the norm.

    You will need broker help with this.
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • Alphabet89
    Alphabet89 Posts: 21 Forumite
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    Thanks kingstreet- I fully intend on using a broker as it isn't your standard setup.

    My broker has immediately suggested one high street lender. I can obtain documentation from my 'employer' as i work in a professional practice.
  • Dogslife4
    Dogslife4 Posts: 13 Forumite
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    I managed 6.7 multiple back in 2011. I used a specialist broker that made the case to the lender (then Northern Rock). They based it on affordability, and since the mortgage term was 35 years, this was affordable in spite of the multiple. 4.5 is not a hard rule.
    Debt Feb 2016 - £906,000 :eek:
    Debt May 2016 - £876,000
  • Caz3121
    Caz3121 Posts: 15,551 Forumite
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    Dogslife4 wrote: »
    I managed 6.7 multiple back in 2011. I used a specialist broker that made the case to the lender (then Northern Rock). They based it on affordability, and since the mortgage term was 35 years, this was affordable in spite of the multiple. 4.5 is not a hard rule.

    which H2B scheme were you using?...OP is looking to use H2B which now has a maximum of 4.5 times income https://www.gov.uk/government/news/help-to-buy-mortgage-guarantee-loans-new-lending-limits
  • Pixie5740
    Pixie5740 Posts: 14,515 Forumite
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    Was Northern Rock still issuing mortgages in 2011 and was anyone giving multiplies as high as 6.7 post-2008 (genuine question)? Since then there's also been the introduction of MMR in April 2014. However, all of this is moot since HTB specifies a maximum of 4.5.
  • Contemptuous
    Contemptuous Posts: 516 Forumite
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    Dogslife4 wrote: »
    I managed 6.7 multiple back in 2011. I used a specialist broker that made the case to the lender (then Northern Rock). They based it on affordability, and since the mortgage term was 35 years, this was affordable in spite of the multiple. 4.5 is not a hard rule.

    I think you'll find the mortgage market has changed a little bit in the last five years..
    Oh and Northern Rock hit a bad patch. I wonder if that was to do with irresponsible lending..?
    Slummy mummy!
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