frustrated with mortgage offer

King_Of_Fools

carolt wrote: »

There is always option 4. Sell your house, bank the equity, and rent a much larger place for the same or less money. Then buy when prices have fallen further.

You should easily be able to rent a 3 bed house for what you currently pay on your mortgage and maybe even a 4 bed one. Plus you would be able to put the £30k equity into a savings account and earn £1500 a year in interest (so in effect you would only be paying 10.5 months rent a year).

In a couple of years time you would be able to buy that £230k house you want for £184k (so you could get a mortgage on it then).

pinkshoes

nzmegs wrote: »

I have a mortgage of 180,000 with northern rock which we were hoping to increase by 20,000 in order to move to a larger house (we have two children and only two bedrooms).
I have just got off the phone from Northern Rock who we have our current mortgage with (it is a good fixed rate so we don't want to change banks) and due to changing markets and my husbands chnage from employeed to self employed we have only been offerred £160,000! This is less than our current mortgage which we pay without any problems. This amount is the absolute maximum they will lend and does not even take into account our debt payments - so the real figure is likely to be less.
We would have 30,000 to put down (from the sale of our house) but that still only gives us £190,000 which will never get us three bedrooms anywhere within 3 miles of our current house...
What a nightmare. We feel we could afford it but due to my husbands self employed status we seem to be non starters. My husband left a £60,000 per year job to go self employed and now is lucky to get £25,000. I work part time and earn £9300. I know it sounds like we cant afford it but we put our home as a priority and always manage to pay it without any problems.
Our current mortgage payment is £930 and an extra £20,000 would only be £1011 which we could easily cover. they just won't let us have it.
Do we have any other options? i guess the obvious one is to stay put and wait till I can work full time( 5years!!!). Ho Hum

It's not really wise to borrow more than 3x or 3.5x your joint salary, which in your case would be about £120k, and given the recent credit crunch, I'm amazed that they offered you £160k!!

I'd suggest that your husband decides what's more important to him - being self employed, or a bigger family home!! If he took a £60k job again, there'd be no problem with a £200k mortgage!