First time buyer in debt

CentiaRoyal

Hi, I am looking for some pre-financial advisor financial advice.
I am currently indebted to the tune of £22k with a debt to income ratio of approx. 60% so was wondering if it is a waste of time seeing a mortgage / financial advisor yet or wait until the debt is clear.
Just to give you a bit of back ground and my circumstances:
I have been very silly and secretive with my money and for numerous (mostly stupid, immature) reasons I was £34k in debt by May 2017. My partner had no idea and my partner is wanting to buy a place with me (she has saved and saved and has over £30k, chalk n cheese, eh?). Obviously, being this indebted was a no-go for me so we agreed that I would seriously pay down my debts as much as I can. I pay roughly £1400 a month paying debts and am now in a much better shape (even if I have further to go). At the time my debts were £22k in a unsecured loan and £12k on credit cards. I am now £18k with my loan and £4k on an interest free credit card (until June 2019).
First to the positives:
My Experian rating is 998
My credit limit / credit card debt is 12% (£4k out of £33k).
My loan is 4.1% and has a monthly minimum payment of £355
My credit card is 0%
I have never missed a payment (even if it is the minimum) and have no defaults, CCJs etc.

The negatives:
I have no savings
I am currently living with my parents again.

I have done several ‘mortgage calculators’ with Nationwide, Santander, Lloyds, Natwest, Halifax (though this had the same outcome as Lloyd’s) and each are saying they ‘may’ be able to lend us more what we would need to buy a house. When I do this with/without the credit card balances they show a difference of about £16k but when I do this with / without the loan there is no difference to the outcome. This gives me hope that we could get a mortgage in about 4 months when I have cleared my credit card. Is this the case? Once the credit card is paid I can either start saving and keep paying the normal loan or overpay the loan (F.O.C). Would not clearing the loan really have no impact? In which case we could go in sooner with a potentially higher offer.
Sorry for the waffle, but if it is not really possible to get a mortgage with the level of debt outlined above then I will carry on just paying it down and not think about buying a house. If it is possible then I think a trip to a financial advisor will be my next step.
Thank you all in advance for your help!

Firsttimebuyers

We've done it, with similar debts - on a 95% LTV - but we're only purchasing a property worth £135k, which was £25k below the maximum levels the affordability calculators seemed to suggest they'd lend us


See a Broker

YHM

Is the DTI calculation based on total income for the application? Confused as to your actual situation? A joint application with your partner or not?

CentiaRoyal

The DTI ratio is just me and I will be doing a joint application. As it stands our joint after tax income is around £4k a month. I currently pay 356 for the loan a month, about 1000 for the credit card and my rent is 200 a month with my everyday spending hovering at 500 a month.

YHM

Which should equate to closer to a joint income of 60k and the joint DTI will be circa 32%. This should be fine

CentiaRoyal

Thank you for your help!

I will invest in some advice once the credit card is paid off and go from there!

CentiaRoyal

Apologies for the self congratulatory gloat but after 2 years and loads of grafting and not going out I have finally paid off all my debt. £34k of personal debt gone. It feels like such a relief and I feel great about it.
Next step is a mortgage and a house purchase. So saving is taking over where debt repayments once were.
Message for anyone on this journey - it can be done, seek help if needed but don't bury your head as it only makes it worse.

CentiaRoyal

Ps this is probably now in the wrong forum, apologies

muhandis

Amazing! Thanks for digging out the thread and updating it. Good luck with the mortgage!

CentiaRoyal wrote: »

Apologies for the self congratulatory gloat but after 2 years and loads of grafting and not going out I have finally paid off all my debt. £34k of personal debt gone. It feels like such a relief and I feel great about it.
Next step is a mortgage and a house purchase. So saving is taking over where debt repayments once were.
Message for anyone on this journey - it can be done, seek help if needed but don't bury your head as it only makes it worse.

Thrugelmir

CentiaRoyal wrote: »

Ps this is probably now in the wrong forum, apologies

Good to hear a positive story. The hard work will be worth the effort. :beer:

Thanks for coming back and updating your thread. Hopefully other people will follow your example.

ScottishSaver14

Well done!!!!!!!! What an achievement. Hope everything goes well for you with the application