Outgoings calculator on mortgage websites

nevkimbers

Probably a daft question.

I'm just going through a mortgage affordability calculator on the Yorkshire Building Society website to see how much I could borrow based on my outgoings.

Currently I pay rent of £550 a month, which of course will disappear to be replaced by a mortgage payment (£150 less a month) once I start paying. (I'm buying my flat from the landlord.)

It would seem silly to include my current rent as an outgoing to determine affordability on a mortgage I will be paying. Unfortunately the website isn't clear.

Should I put proposed mortgage as outgoing? This being £400 would be a more accurate depiction of affordability at the point I start paying the mortgage.

Thoughts?

K_S

@nevkimbers Don't know about the YBS one but most affordability calcs you don't put in the rent (as you won't have that expense after completion) and you neither put in the monthly mortgage payment (as that's what the affordability calc is seeing if you can afford). I hope that makes sense.

dimbo61

Have a look at a few other lenders websites to get an idea of how much you can borrow.
Until you have got a DIP ( Decision in Principle) from the most suitable lender for your circumstances.
This is why many borrowers use a whole of market  mortgage broker.

Thrugelmir

nevkimbers said:

It would seem silly to include my current rent as an outgoing to determine affordability on a mortgage I will be paying. Unfortunately the website isn't clear.

Should I put proposed mortgage as outgoing? This being £400 would be a more accurate depiction of affordability at the point I start paying the mortgage.

Thoughts?

Ignore anything that you won't be paying once you own the property. 

Ignore the mortgage. The purpose of the affordability calculator is to determine what you could potentially borrow. The cost of the mortgage may fluctuate as interest rates rise and fall in the future. Lenders make an allowance for this.