Our first steps in buying a house

glasgowdan

AdrianC wrote: »

Well, it was free in that there was no charge made directly...

It's the same as any financial advice. The advisor needs to be paid. They can be paid by taking commission from the lender, or they can be paid directly leading to a better deal. One is more transparent than the other. Which is better value...? How long IS that piece of string?

You're not obligated to take up a mortgage with a lender just because they've had an application meeting with you.

Feel free to get a couple of appointments to find out exactly how much you can afford before looking for the right house.

ruby_eskimo

PrettyFlower90 wrote: »

I'll have a look at the Halifax calculator, thanks. It's just we know what we could afford, and what credit cards payments we have etc but doesn't mean lenders will offer us a mortgage.. there are mortgage brokers that don't charge a fee to the buyer so I could look into one of them to see if we're close to being able to get a o mortgage.

We spoke to the free one that MSE recommends (can't remember who they are off the top of my head) and they found us a pretty good deal, but this was matched by the Halifax when we went to see them. We only started enquiring earlier on in the year to see how far away we were from getting a decent mortgage (we work in a pretty expensive part of the country without the salaries to match!) and were pleasantly surprised at what came back. Get the keys to our house 2 weeks today!

Rain_Shadow

sparky130a wrote: »

Very true. Here in Soton though we wouldn't advise EA services...

Welcome back Mark

hazyjo

PrettyFlower90 wrote: »

I'll have a look at the Halifax calculator, thanks. It's just we know what we could afford, and what credit cards payments we have etc but doesn't mean lenders will offer us a mortgage.. there are mortgage brokers that don't charge a fee to the buyer so I could look into one of them to see if we're close to being able to get a o mortgage.

You have credit card debt? What sort of amount?


Advisable to pay that off with any savings or they will knock that (plus interest at least) off what they'll lend you.


Jx

PrettyFlower90

I say credit card debt, but it's very small and we could easily pay it now, but it's all 0% interest and one of the cards we only pay £23 a month for it, so we don't have a big up front payment. It's prob around £2k if even. Another reason why we thought we should see a broker to see if paying that off now will make a significant difference to our chances.

Cakeguts

The problem is that all the only £23 a month things that you have all add up. So it is only x amount a month for the credit cards and only x amount a month for the phone contracts and x amount a month for the broadband and x amount a month for the car finance.

If you are serious about buying a house you have to go through all the x amount a month and get rid of the ones that you can live without. When you have done this you try to save the biggest deposit you can. Then when you have bought the house you continue to live in the same way because you have to have a lot of savings to pay for repairs to your house.

Having £2000 debt on a credit card shows that you are not serious about saving money because you have spent £2000. The fact that is it interest free doesn't mean anything what is important is that you have spent this money that could have been part of your deposit money as could the only £23 pounds that you are spending monthly on having that credit card. Paying off this debt would be a good way of starting to save properly for a deposit.

AdrianC

PrettyFlower90 wrote: »

I say credit card debt, but it's very small and we could easily pay it now, but it's all 0% interest and one of the cards we only pay £23 a month for it, so we don't have a big up front payment. It's prob around £2k if even. Another reason why we thought we should see a broker to see if paying that off now will make a significant difference to our chances.

So you owe £2k on a card - which offsets £2k of your savings. 0% or not, that's £2k less towards your deposit.

da_rule

When I was looking at buying I had money on a credit card (about £4k). The lender and the broker didn't question it. I had the money to pay it off but was told not to. I was making all of the payments and it didn't cause me any hardship.


Someone also mentioned that some lenders like to see that someone has a credit history and understands how to manage credit.

PrettyFlower90

I understand what you're saying but take offense to implying that I'm not serious about saving. I have saved £18k alone while also paying for a wedding on top, I don't go out, I don't shop, I don't buy things for myself. What I'm wanting to see, not particularly from people on forums as such, is if £2k on a credit card would significantly hamper our mortgage chances, as paying the £2k and effectively taking this from our deposit savings would significantly put us back as we wouldn't then have enough deposit.

da_rule

Your best bet is to go and speak to a mortgage advisor or a broker.


If your credit card and current accounts are with one of the major high street banks you could start with them as they'll have instant access to your financial history. They will obviously only be able to sell/advise on their products, but it'll be free and a good place to start.