150k mortgage needed on 30k income - doable?

Brit_Chick

I'm posting this on behalf of a couple that I know wishing to get onto the property ladder, they earn 30k between them and want to borrow £150k....is this possible?

Thanks in advance

[Deleted User]

They might be able to afford it, but you'd need to talk to a broker to find out if anyone would lend them it

herbiesjp

what is the property value and what deposit do they have?

Do they have a clean credit history?

Brit_Chick

Property value is 160k and they have a 10k deposit. Their credit history is clean.

homer_j_3

their mortgage payment would be close to 50% of their net pay. Assuming that they have no other debt then yes there probably would be lenders prepared to look at it - assuming no hidden nasties.

Ideally a further 6k would have been better for them but it still should be possible.

herbiesjp

Agreed - it is possible with a few lenders, but they will need to get a good score on the lenders internal scoring system to get anywhere those levels

Brit_Chick

How much would their payments go down if they were to raise an extra 6k?

I have reminded them that they should allow around 4 or 5k for all the legal/moving/mortgage costs, is this figure reasonable?

herbiesjp

It depends on the lender, however by borrowing 90% it means that there will be no Higher Lending Charge and the rates may well be lower with some lenders

Brit_Chick

Thanks for the helpful replies folks.

I also forgot to ask, are there any companies that still offer mortgages over a 40 year term and if so, who? It also looks like the couple in question are going to have to apply for a self certified mortgage due to the nature of the job of one of the applicants.

NeilQuinn

They won't get a self cert mortgage for £150K on a purchase of £160K. That's 93% lending.

It's been ages since I've done a self-cert but I think the maximum they'll get 85%. I'm not sure if anyone's doing 90's at the moment.

herbiesjp

Brit_Chick wrote: »

It also looks like the couple in question are going to have to apply for a self certified mortgage due to the nature of the job of one of the applicants.

I think they should let the brokers be the judge of that:rolleyes:

What is the nature of one of the jobs?

A 40 year term will depend on the lender and their age at the moment