Deposit from a loan?

Neutrinno

bflare wrote: »

I have had no CCJ's, bankruptcy. I had a default to a mobile company from around 10 years ago but that's now statute barred. I have no idea what a IVA is?

Credit history sounds fine then. It's an arrangement set up with creditors when you can't afford to repay your unsecured debts, don't worry you'd know if you had one.

bflare

laidbackgjr wrote: »

It sounds ok - but if you have £400 spare income each month - how come you have no savings? If you could save this spare £400 a month then you'd have a pretty good deposit in a couple of years.

That's a good point. I were ok with renting until a few months ago so I had no intention of buying an house or saving. Most of my disposable income was spent on basically things I didn't need & treating my son to things that I otherwise wouldn't.

ACG

bflare wrote: »

My credit rating is pretty good & after paying all my bills, child maintenance etc I still have £400 a month disposable income & that includes my current loan of £225 a month. Does this sound like I would be in a good position? Thanks.

What would you have after paying a Mortgage if the interest rate were say 7% in addition to the loan? That is what the lender will be assessing you against more or less.

bflare

ACG wrote: »

What would you have after paying a Mortgage if the interest rate were say 7% in addition to the loan? That is what the lender will be assessing you against more or less.

To be frank I have no idea how mortgages work & interest rates on them. I was looking at a mortgage of around 95k with hopefully a 5% deposit. What kind of repayments would 7% be over 25 years?

Neutrinno

bflare wrote: »

To be frank I have no idea how mortgages work & interest rates on them. I was looking at a mortgage of around 95k with hopefully a 5% deposit. What kind of repayments would 7% be over 25 years?

£671 per month.

csgohan4

you need to save more aggressively. There is no shame in renting, you are after all paying for a service a roof over your head.


Keep saving and shave off the excess you don't need, like a new car or that lavish holiday for example.

Richard_Overton_2911

Along with loans for deposits all we need is the return of self cert and 125% mortgages and we will back to square 1..............

Make you wonder if people learned anything from the financial crisis or was it just a big bad dream .............

minimike2

Richard_Overton_2911 wrote: »

Along with loans for deposits all we need is the return of self cert and 125% mortgages and we will back to square 1..............

Make you wonder if people learned anything from the financial crisis or was it just a big bad dream .............

If someone on £350k a year got a £5k loan towards a £50k house purchase, how difficult do you think the two would be to service?


Not saying either way if it is or isn't a good idea, but there is no logic in simply saying that borrowed deposits are bad.

Nebulous2

Richard_Overton_2911 wrote: »

Along with loans for deposits all we need is the return of self cert and 125% mortgages and we will back to square 1..............

Make you wonder if people learned anything from the financial crisis or was it just a big bad dream .............

It's a pendulum. Correction swings too far. Just hope that it stops somewhere in the middle rather than going back the other way.

Richard_Overton_2911

minimike2 wrote: »

If someone on £350k a year got a £5k loan towards a £50k house purchase, how difficult do you think the two would be to service?

Someone on £350k a year would be in the top 5% of earners and I doubt very much they would need a £5k loan on a £50k purchase.Nothing like choosing an extreme example to justify a poorly made point.

Maybe we should also revert to 125% mortgages ,I'm sure Mortgage Brokers can make a good case for bringing them back. Something like "When the house value increases by 25% in year 1 the lenders will be quids in", its a sure bet and can't go wrong".