Advice needed please - 100% mortgage

liss90

I would love some advice please or opinions!
Our situation is that my partner and I currently rent a property for £900 per month with £169 council tax and of course utitlity bills.
We have four children (18,15,13 and 18mths)
We recieve no help with the rent or council tax and both work. My partner earns £30,000 + £2,500 min bonuses per year. I work one day a week and bring in with family allowance & tax credits about £5,500 per year.
We have had to move 3 times in 4 years due to houses being sold by landlord etc. We live in London so rents are high.
Anyway paying the amount of rent that we pay and having children has made it impossible to save money for a deposit.
We would like to move to a area of Kent where most of my partners family live. It is cheaper to buy a house, I would be able to work more as childcare is half the price and I would have been offered help with childcare for free.
I would also be able to get a new job because a friend has a sucessful recruitment agency.
The area we have chosen currently has 4 bed houses for around £125,000
There will be a fastlink to London by 2009, a huge shopping centre being built and money proposed to rebuild certain areas.
Therefore I believe house prices will go up in a few years. We also would downsize in 10yrs (hopefully)
Can anyone give me any advice regarding 100% mortgages. Would it be a good idea in our case. We have no way of saving for a deposit or borrowing from family at the moment. We also are not keyworkers so therefore do not qualify for any help. Homebuy is not an option either - I have looked into it.
I don't know when the goverment is bringing this new shared ownership in and we have been told that it will be a lottery deciding who will recieve help.
I also believe that house prices will go up when this comes into effect.
We have good credit history, one rental agency said my partner had gold and I have Silver (!?!)
Sorry this is such a long one and hope you have not gone to sleep!
Thanks inadvance.

meanmachine_2

It's probably best to apply for a single mortgage, based on your partner's earnings. He should be able to borrow up to £135K.

Put your details into one of the online mortgage checkers - charcol, moneyextra etc and see what comes up, then go see a broker.

Since you have a good credit rating you should be OK for a 100% mortgage, but that might put you instantly into neg equity, should prices drop even by a little.

The Gordon Brown scheme is mere window dressing, helping fewer than 5% of FTBers on the lowest salaries (it's assumed), so probably won't have much impact on the market.

But if you have no savings, how will you pay moving fees, stampy duty (on property over £120K), furniture etc?

I agree though that a mortgage in your circumstances will be cheaper than renting - by around £150 a month.

liss90

The fees are being covered by my mother, bonuse due in july etc. The furniture we have collected over the years and is stored at a friends.
If my partner applies for a mortgage on his own, does that mean I would not be entitled to any of the house should we split up?
The reason I don't work is because of the children. 2 of which are from a previous marriage. His wife died suddenly and they came to live with us hence I cut down on hours and have since had another child with him.
Sorry if tmd but I always feel the reason to justify why I don't work much and why we have so many children!

jonesMUFCforever

IMO the mortgage should be in joint names. Then there can be no arguments if you split up. The fact that you don't earn much should not be a factor if your partner earns enough for the mortgage.
Be prepared to pay over the odds though for a 100% mortgage. Think about not signing up for a long term deal so you have the option at a later date to re mortgage if property prices rise. You should get a better deal if you have equity in the property.
Eric

mountainofdebt

Apart from the fact that I wouln't recommend 100% mortgages (having been bitten when house prices went down - and who says they alwys have to go up?) why does it matter who's name is on the mortgage?

I would be more concerned about whose names were on the deeds.

jonesMUFCforever

If the mortgage is in joint names then the names on the deeds will have to be in joint names.
Eric