Estate agent financial 'advice'

AliceBanned

Sorry yes my mistake, that's what I meant.

kingstreet

Make sure a decent estimate of the cost of ground rent & service charges is included in affordability, as well as any credit costs.

Upto five times income may be possible, but such costs then come out of what is considered affordable.

AliceBanned

Thanks kingstreet.

AliceBanned

I just did a soft search using Compare the market which I believe uses some credit reference agencies?


It is showing £165k as top lending available. I would have £43-50k deposit from the sale of current flat. So this would fall short of the cost of a two-bed flat in the area, by £10k approx. if I factor in all the fees and costs of buying and selling.


I am getting a valuation done on my shared ownership flat in two weeks. This is valid for 3-6 months depending on whether the housing assoc finds a buyer.


I am taking a slight chance on the values continuing to drop in the area, after I have sold and I will rent for a few months in between (very cheap in house share and friend has offered me flatshare with him as he has just been made redundant).


It's a bit scarey to take the step to sell with no way of knowing I can get what I want in the near future to move into, yet I am paying £530 in rent and service charges plus £320 mortgage where I am so it is harder to save. Rental would be under £500 a month. Does this sound a wise move? If the valuation is reasonable and my SO flat sells..SO has been ok for me, quite good but I now feel I need to buy outright and move on.

AliceBanned

PS Aside from the finances I get the feeling that being in rented is probably a better place from which to buy my next place, especially as rental rooms in the area are reasonable and it would be short term. I don't want to move into my next home for five years because I am in a rush because of my buyer (assuming I get one).


No idea of the cost of storage but I have quite a bit of furniture /white goods and don't want to sell any of it.

ACG

Stick to a broker. Online sites have access to maybe 20-30 lenders max (if that). Brokers have access to 80+.

Also some online sites will just put a standard cap in place for income multiples, I do not think any have a full tie in to lenders affordability calculators so take the figures with a pinch of salt.

AliceBanned

ACG wrote: »

Stick to a broker. Online sites have access to maybe 20-30 lenders max (if that). Brokers have access to 80+.

Also some online sites will just put a standard cap in place for income multiples, I do not think any have a full tie in to lenders affordability calculators so take the figures with a pinch of salt.

Thanks ACG. My IFA broker suggested I wait until January because of my debts.


It's a bit chicken and egg as I don't know when to sell if I don't know how much I can borrow but I can't put my place on the market in January as I am starting to view properties now. Should I speak to another broker perhaps? I wonder whether he said that because he was busy because he always seems to be. Or maybe just because he is certain I won't get the borrowing before then.

AliceBanned

PS it looks like various lenders offer AIP application on their websites, with a soft search. It is the hard credit search at this stage that worries me as I am not ready but need to find out when I am ready to buy depending on how much I can borrow.

Eg Natwest says AIP application is done via soft search. Is it worth me trying this? I am only trying to get ballpark figure to help me make a decision. I know the actual reality of borrowing depends on my situation being more definite ie finding the right property. But it is hard when I am so uncertain of what I can borrow..

ACG

As kingstreet mentions, there will be rent and service charges to account for. Obviously you do not know what these are upfront, but you presumably have an idea? I do not do shared ownership so other than the basics I am next to useless on this sort of thing.

You should be able to get a good idea of what is achievable without doing credit checks, they will offer you nothing more than an affordability calculator will. To be blunt, if you cant get a figure from an affordability calculator, you have no hope with a DIP.

Put in a realistic amount for rent/service charges etc on the affordability calculators and you have your figure. If you go low, then it may affect your affordability but if you are realistic you will be in the right ball park.

Personally, I think you should find another mortgage broker. You have a lot of questions and concerns and I think having someone on side will do you the world of good if not just for your stress levels (and I say that as someone who does not do shared ownership so have nothing to gain from it).

AliceBanned

Thanks ACG. I won't be purchasing Shared Ownership. I am selling SO but buying on the open market.


I think you are right. I'm not getting many answers or I'm getting an over-optimistic lending figure from the EA advisor (the EA which is keen to sell my flat of course as they have people waiting).