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Help to Buy Scotland with debt
Determinedtobedebtfree
Posts: 24 Forumite
Hello,
I’m hoping for some help re what’s my best course of action to get a mortgage.
My husband and I live in Scotland and we have seen a new build house for £199,000. The development is only about to start and we were hoping to be in a position to buy around the end of the year. We’ve been saving since Christmas and we’ve managed to put aside nearly £6,000 so far and we will have the rest of the 5% deposit by late summer/early autumn.
However we have a couple of questions about whether we will qualify for Help to Buy and around some existing debt.
Our take home pay is £63,000 (I am on a salary of £43,500 and my husband earns £19,500 per year). Would this be OK for Help to Buy, I wasn’t sure if there was an upper salary limit? I keep reading that you won’t qualify if you could raise the mortgage without Help to Buy. We are in private rented accommodation, I have lived in the house since 2011 and my husband a couple of years later and we’ve never missed a rent payment. We have both previously owned a home with other partners.
On that note, my husband has zero personal debt but has a credit card which he uses occasionally and pays off in full to keep his credit rating high. I have quite a lot of personal debt, a loan of £14k at an 6.9% APR and 3 credit cards with a balance totalling around £20k. My credit cards are all 0% but I am only paying just over the minimum, so will need to trf again once their deals finish.
The personal debt is a hangover from a few things including a nasty break-up with a previous partner in 2011 which left me with significant high rate debt, being made redundant soon after and then having to take a lower paid job to pay the bills. I have a good credit rating with zero missed payments (it was a struggle but I worked two jobs for a while). It’s not an excellent rating as my utilization is quite high. I’m on a good salary now and we can afford a mortgage on Help to Buy but I’m worried it’s a pipe dream with my level of debt.
The loan for £14k was over 3 years and I’m 6 months in, so my payments are quite high £468 per month.
My bank has offered me a loan for £35k to pay off everything at a rate of 5.9%, this would be over a period of 7 years (just over £500 per month). This would mean I was only making one payment per month. My question is would this look better to a mortgage company if I only have one loan? If I took it out now, I would have made 6 months of payments before applying for a mortgage. This would also allow us to save an additional £400 per month towards deposit/moving costs/overpayments and once we’ve moved, I would use this money to just make overpayments to the loan. I don’t want to do it if lenders would look unfavourably on a personal loan for consolidation as I don’t want to ruin our chances to buy. I would also retain one of the credit cards but have the limit reduced to £2,500 and use it occasionally as my husband does (just to keep my score up). Any help would be greatly appreciated. Thanks
I’m hoping for some help re what’s my best course of action to get a mortgage.
My husband and I live in Scotland and we have seen a new build house for £199,000. The development is only about to start and we were hoping to be in a position to buy around the end of the year. We’ve been saving since Christmas and we’ve managed to put aside nearly £6,000 so far and we will have the rest of the 5% deposit by late summer/early autumn.
However we have a couple of questions about whether we will qualify for Help to Buy and around some existing debt.
Our take home pay is £63,000 (I am on a salary of £43,500 and my husband earns £19,500 per year). Would this be OK for Help to Buy, I wasn’t sure if there was an upper salary limit? I keep reading that you won’t qualify if you could raise the mortgage without Help to Buy. We are in private rented accommodation, I have lived in the house since 2011 and my husband a couple of years later and we’ve never missed a rent payment. We have both previously owned a home with other partners.
On that note, my husband has zero personal debt but has a credit card which he uses occasionally and pays off in full to keep his credit rating high. I have quite a lot of personal debt, a loan of £14k at an 6.9% APR and 3 credit cards with a balance totalling around £20k. My credit cards are all 0% but I am only paying just over the minimum, so will need to trf again once their deals finish.
The personal debt is a hangover from a few things including a nasty break-up with a previous partner in 2011 which left me with significant high rate debt, being made redundant soon after and then having to take a lower paid job to pay the bills. I have a good credit rating with zero missed payments (it was a struggle but I worked two jobs for a while). It’s not an excellent rating as my utilization is quite high. I’m on a good salary now and we can afford a mortgage on Help to Buy but I’m worried it’s a pipe dream with my level of debt.
The loan for £14k was over 3 years and I’m 6 months in, so my payments are quite high £468 per month.
My bank has offered me a loan for £35k to pay off everything at a rate of 5.9%, this would be over a period of 7 years (just over £500 per month). This would mean I was only making one payment per month. My question is would this look better to a mortgage company if I only have one loan? If I took it out now, I would have made 6 months of payments before applying for a mortgage. This would also allow us to save an additional £400 per month towards deposit/moving costs/overpayments and once we’ve moved, I would use this money to just make overpayments to the loan. I don’t want to do it if lenders would look unfavourably on a personal loan for consolidation as I don’t want to ruin our chances to buy. I would also retain one of the credit cards but have the limit reduced to £2,500 and use it occasionally as my husband does (just to keep my score up). Any help would be greatly appreciated. Thanks
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