Help to buy after divorce? Feeling lost!

PinkPanther87

Hi,

New here but have been an avid lurker for a long time. I'm looking for some advice as I'm feeling totally lost!

I am 30 and recently got divorced. We owned our home and had extended it and made a fair bit of money.

We have a 3 year old little boy who lives with me but sees his dad plenty (it is a very amicable split).

My STBXH bought me out of our home and I now have £85k.

Luckily, having learnt from mistakes when I was young and dumb I have no debt and no credit cards.

I'm currently renting with my little boy and paying £720 a month rent. I did this as us living together wasn't working and I didn't want to stay in the house and he did so we have had a financial order drawn up with regards to the £85k and the divorce was all done swiftly as we both agreed on the £85k plus £150 p/m maintenance payments.

I earn fairly good money and I am self employed with 7 years up to date accounts.

The problem is since having my little boy and extending our house the last three years my income took a hit.
This has since been rectified as I've been working my butt off since the split.

But I don't have three years good enough accounts to get the morgage I'd need to buy!

So do I wait three years and just carry on renting or do I look into shared ownership?

I have owned my own home since I was 18 and feel totally lost right now without having someone to talk through big financial decisions with.

The houses in my area are around £200k minimum for a two bed and moving isn't an option as I don't want my little boy taken away from his dad. Ideally I'd like a three bed for around £230k.

What are my options here? Anyone done a shared ownership? Help to buy ISA in the meantime? I don't know where to start.

I'm currently this year earning an average of £4K a month so can afford to rent but it just seems such a waste at the same time!

Thanks in advance for any help.

AnotherJoe

Having no credit cards isn’t necessarily a good thing. Having a record of long term paying off credit cards may well be better than no record and no card.

A good broker may be able to help you find the right lender, you don’t seem too far off what you need, £4K x 12 x 3 plus £80k is getting towards your £230k, in the meantime a credit card with a modest limit and a record of consistent payback (and which incidentally will give you some added consumer protection) will likely help your case and the sooner you get one the longer record you have. Speak with a broker and get their advice.

bouicca21

I second the advice to get a credit card and pay it off each month. A friend recently needed a credit reference and couldn't get one, despite substantial savings and no mortgage, as had no credit card.

bowlhead99

PinkPanther87 wrote: »

What are my options here? Anyone done a shared ownership? Help to buy ISA in the meantime? I don't know where to start.

I'm currently this year earning an average of £4K a month so can afford to rent but it just seems such a waste at the same time!

Your basic options are:

- compromise and buy a smaller place e.g. flat instead of house and move up the chain in a few years time, accepting two lots of moving costs, stamp duties and legals etc

- shared ownership where you buy only part of the property and rent the rest off the other owner until you can afford to staircase your ownership chunk all the way to properly owning it

- rent until you can afford to buy the place you want (deposit plus provable income)

Forget a help-to-buy ISA, as you have been a property owner for over a decade and the free government support is only for people who can say they have never owned any part of any residential property.