5 X salary Mortage

nickyg2000

Hello,

My partner and I have found a house we have a deposit of £134,000 and need to borrow £226,000. We jointly earn £46,000 so very close to 5X salary of £230,000. Santander seem to be the only lender offering LTI at this level. My broker only deals with the main high street lenders and confirms this. Halifax & Natwest will go to £223,000 but it all seems very tight.

Is there any non high street lenders who will do more of a stretch? Our earning will rise in the future and its a forever house.

Thanks

AdviserSteve

Hello

I am a financial adviser and I am wondering if you have any additional income such as bonuses, working tax credits, child benefit etc.

Your credit commitments also matter to such as loans, h.p, credit cards etc

Also, is this a new build house you are buying or pre-owned?

Regards

Steve

enjoyyourshoes

Just a cautionary word, have you worked out the affordability of what you are proposing?

Have you stress tested the idea with interest rate rises in incremental steps?

House prices can go down and have you considered not rushing in and seeing how the market is responding.

kingstreet

FTB or subsequent purchaser?

Santander LTI cap for FTB is 4.45x.

As mentioned earlier, what you can borrow is a function of your credit commitments, dependents, student loans, ground rent & service charges, maintenance, childcare and so on as well as your incomes.

Your broker needs to do the calculations making sure everything is correctly entered in the calculator.

nickyg2000

Thanks,

So we both have permanent jobs, no credit commitments, no debt, no dependents, excellent credit history, second purchase (currently own and have a mortgage). My broker has done this we had a mortgage offer with Santander for £198,000.

Is there any non high street options. Its a 1930s house btw

David_White

nickyg2000 wrote: »

Santander seem to be the only lender offering LTI at this level.

I'm not suggesting this is the best way, but assuming your broker has offered this solution have you tried Santander?

nickyg2000

My worry was relying on one lender. If they change there lending criteria we are up !!!! street. Plus £4k leg room isn't much as I don't want to risk a rejection. Is a rejection in principle an issue on your credit file?

foxy-stoat

Put in a lower offer?

David_White

Having a decision in principle whilst not ideal isn't the end of the world.

I help people with bad credit and generally speaking the people I talk to have already been declined by a handful of lenders and I've never had someone get declined purely on the basis that another lender didn't approve their case.

looknohands

What are repayments on that compared to your monthly income. I would be very careful even if you can get a mortgage somehow and it is your dream home you need to live. You wont have the dream life to go with the home if you're scrapping the barrel each month, baked beans don't taste any better in a nice kitchen!

Thrugelmir

nickyg2000 wrote: »

Our earning will rise in the future and its a forever house.

What matters is now not the future. Life is full of uncertainies that have grave financial impacts. Hence why lending criteria is so much tighter than it was for a period of time.

Easier to build more equity and/or increase the size of your deposit while you owe less.

Have you sold your existing property?

Has anything changed since your previous very similar threads?