Pay increases and mortgages

lostinrates

I'll try and keep this simple, nothing to do with mortgages seems to be!

My DH starts a new contract with current employer in March. For one year he'll be on approx £40,000, the second year approx, £45,000 then third year a big leap to £90,000. I am a fulltime housewife. We have no debts and approx £70,000 to put down as a deposit. The only other asset is my husband's 1/9 inheritance of a property. His 1/9 has been estimated at approx £100,000 but the property has not sold as yet.

Are there any lenders who will take into consideration the increasing rates of pay- bearing in mind a faultless credit rate and asset? or is it simply a matter of getting a smaller mortage on the £40,000 and then selling and getting a bigger mortgage for a more longterm house in two years time? Even in a relatively good financial situation, debt free and with a good deposit, buying in the SE of UK is scary...particularly if looking fo a family home.

We would have prefered a longer commitment to a first home despite the heftier mortgage. The idea of selling again in two years with kids in tow doesn't appeal, and the costs of short term buying fo home rather than development don't seem so good either.

kevinchapman82

How much would your ideal home know be? You could probably get over £250,000 now if you went to the right lenders. Also a lot depends on what he does for a living. Professionals tend to be looked on more favourably for this sort of thing.

herbiesjp

Are the figures you quote in a contract somewhere?

lostinrates

He is a lawyer. Really, bearing in mind we don't want to move, we have (asset and deposit combined) £170,000 approx to put down and the financial burden would ease within 24 months (salaries do not include discretionary bonuses, which have been good so far). Gulp, a house I think we'd stay in for upto five years in commuting distance of London is, (I have to gulp again) between £400,000 and £450,000.

lostinrates

herbiesjp wrote: »

Are the figures you quote in a contract somewhere?

Yes . He has signed his contract, and these are 'not less than figures'. |Sorry in post above should have said TRAINEE for two years. Firm has never not employed trainee on qualification.

herbiesjp

There may well be a few lenders that could look at this for you, and look at either higher multiples, or look at more flexibility with your income.

Your DH starts in March - when did you want to start looking for properties?

lostinrates

WOW...who! I'd like to start looking, well, ASAP. We're hovering incase there is a big down turn, but really.....we gotta live somewhere! He is already employed by the firm in another role in another EU conutry (he is British!)

herbiesjp

If he is with current employer where is he based and what is his current income? How long has he been abroad?

We are in September now, so I think it is still a little early to look at lenders giving a firm agreement on this

lostinrates

OK, what would you suggest for timing? It is possible to wait til after March and rent in the time from March till house found, we're just keen!

He is in Italy. Not sure of current income in Euros, I can find out tonight....its a little less than he will get on return to UK. Has been in the office currently in since July 06. UK offer was raised quickly and he signed a contract for March earlier this year. He did approach his bank for a mortgage offer but it was not flexible...and I've read the advice here not to do that now! We also have the possibilty of a guarantor, but would prefer to avoid that route.

Dead_Eye_Jones

Ive not heard of lenders who would take future earnings into consideration. It would also seem a bit of a risk. Presumably the postion is dependant on him meeting certain requirments and reaching a certain standard?

Thats a tricky one, not sure what Id do. To stretch knowing that all being well you'll be OK, or play it safe and wait a bit but potentially have to make an extra move.

On the basis that buying and selling is a 'mare, and uncertainty over current financial markets, i'd prob actually just stick to renting with a short term goal of finding the house when the 90k salary starts coming in.

You should seek pro advice, they'll tell you ya options straight away .

lostinrates

I understand what you say.

If property prices don't fall but stabalise or rise we're in trouble though. Its a gamble and noone can answer it that I can tell.

However, his job is not a gamble