Very nervous first time buyer PLEASE HELP!

george48lauren98

Hello,

Id like to preface this post by saying I’m an extremely anxious person so all my worrying may be for nothing. 

Me and my partner have made an offer on a property which has been accepted for £295,000. I had an AIP from nationwide prior to making this offer. 

I am now however extremely worried that when we apply for a mortgage this will get declined. 

For background information, I earn £28k per year with £5k annual bonus, and my partner earns £33k with £1-2k overtime give or take. We have both saved £15k each to pay for a £30k house deposit. I have a credit score on experian of 999 and so does my partner. My credit score on check my file was 815. 

We have no defaults, loans, CCJs, car finance etc. 

However, my main concern is my bank statements as for the last 3-6 months I have been living a very lavish life (because I could afford to as I have no other outgoings and currently live with my parents!) I have been splurging on clothes, food, holidays etc sometimes to the point where my outgoings have been more than my incomings. I have however never ever dropped into my overdraft and always ensure I have a minimum of £1k in my account. 

My other concern is there is multiple paypal and klarna transactions on my bank statements (because of all the items I have been buying myself!) The klarna payments have always been paid on time or early but I’m just nervous a lender may think this a red flag. 

My partner doesnt have any spending like this and is much more conservative but I feel like I may have ruined our chances. 

Obviously I know this is discretionary spending, and I could stop as soon as I have more important financial commitments but I’m nervous a lender may not think this. 

Our only regular outgoings are £70 for public transport, and a £50 monthly phone contract. 

I also have £45k inheritance&savings in premium bonds (which I’d rather save for the property as it’s a bit of a fixer upper, as opposed to use it for the deposit) but I dont know if lenders would consider this as some form of financial stability?

We do have a meeting with a broker on Wednesday but I’m just so anxious that I can’t sleep until we have this appointment. 

Any advice or reassurance you could provide would be great as I’m terrified of us getting rejected because of me and us losing our dream property. 

*some of you may also be wondering why I didnt stop spending prior to purchasing a house - but we really didnt plan on purchasing until the end of the year, but a dream property turned up and we felt like we couldnt miss out on this opportunity

gwynlas

Ypu already have AIP from one lender and are meetinga broker who will advise you on the way forward so why are you worried? You have regular payments out which you meet from income so as a first time buyer there does not appear to be an issue.

K_S

@george48lauren98 looking to borrow 265k at 90% LTV, income of £61-67k, no debt, no credit issues and 45k savings as backup. I can't see any reason why you wouldn't be able to borrow what you need from a mainstream lender.

Discretionary expenditure - will not be relevant for the vast majority of mainstream cases, nothing to worry about

PayPal, Klarna - may need to be declared as debt if you have 3-6+ months of payments outstanding. But unless they're huge, it's unlikely to stop you from borrowing what you need or cause any issues otherwise.

You're doing the right thing by speaking to a broker, and honestly you should be absolutely fine, good luck!

george48lauren98 said:

Hello,

Id like to preface this post by saying I’m an extremely anxious person so all my worrying may be for nothing. 

Me and my partner have made an offer on a property which has been accepted for £295,000. I had an AIP from nationwide prior to making this offer. 

I am now however extremely worried that when we apply for a mortgage this will get declined. 

For background information, I earn £28k per year with £5k annual bonus, and my partner earns £33k with £1-2k overtime give or take. We have both saved £15k each to pay for a £30k house deposit. I have a credit score on experian of 999 and so does my partner. My credit score on check my file was 815. 

We have no defaults, loans, CCJs, car finance etc. 

However, my main concern is my bank statements as for the last 3-6 months I have been living a very lavish life (because I could afford to as I have no other outgoings and currently live with my parents!) I have been splurging on clothes, food, holidays etc sometimes to the point where my outgoings have been more than my incomings. I have however never ever dropped into my overdraft and always ensure I have a minimum of £1k in my account. 

My other concern is there is multiple paypal and klarna transactions on my bank statements (because of all the items I have been buying myself!) The klarna payments have always been paid on time or early but I’m just nervous a lender may think this a red flag. 

My partner doesnt have any spending like this and is much more conservative but I feel like I may have ruined our chances. 

Obviously I know this is discretionary spending, and I could stop as soon as I have more important financial commitments but I’m nervous a lender may not think this. 

Our only regular outgoings are £70 for public transport, and a £50 monthly phone contract. 

I also have £45k inheritance&savings in premium bonds (which I’d rather save for the property as it’s a bit of a fixer upper, as opposed to use it for the deposit) but I dont know if lenders would consider this as some form of financial stability?

We do have a meeting with a broker on Wednesday but I’m just so anxious that I can’t sleep until we have this appointment. 

Any advice or reassurance you could provide would be great as I’m terrified of us getting rejected because of me and us losing our dream property. 

*some of you may also be wondering why I didnt stop spending prior to purchasing a house - but we really didnt plan on purchasing until the end of the year, but a dream property turned up and we felt like we couldnt miss out on this opportunity

george48lauren98

K_S said:

@george48lauren98 looking to borrow 265k at 90% LTV, income of £61-67k, no debt, no credit issues and 45k savings as backup. I can't see any reason why you wouldn't be able to borrow what you need from a mainstream lender.

Discretionary expenditure - will not be relevant for the vast majority of mainstream cases, nothing to worry about

PayPal, Klarna - may need to be declared as debt if you have 3-6+ months of payments outstanding. But unless they're huge, it's unlikely to stop you from borrowing what you need or cause any issues otherwise.

You're doing the right thing by speaking to a broker, and honestly you should be absolutely fine, good luck!

Thanks so much for your response!

i really do over-worry and can get myself in a state so really just needed to get it off my chest!

with regards to the Klarna payments, i paid my last klarna payment about a week ago so this is now 0. I have used it regularly over the last 6 months but have always cleared the balance so everything is now £0. I used klarna in the past thinking its good for credit scores, but after a bit of reading i may reconsider

I know credit files take a while to update so despite my balance being £0 on klarna now, will I have to declare the last balance? 

ACG

In all honesty though, I think you will be fine. Some lenders do not ask for bank statements. The ones that do are generally looking for undeclared commitments, signs of financial distress (ie missing payments) or evidence of income. 

There are exceptions to the above, but those are more specialist or smaller lenders. 

Easier said than done, but I reckon only a handful of my clients will be as straight forward as you will be. Your only potential issue is the credit checks carried out by Klarna. But even with those I think you will be fine.