FTB Halifax mortgage income multipliers

househunter81

Hi my boyfriend and I are looking to buy our first home. We are looking at properties for around £100000 and we have 5 % deposit saved. The property we viewed recently also has 5 % vendor gifted deposit. The problem is my boyfriend has excellent credit but only earns around £23000 a year, £7000 of which is overtime which he always gets on a monthly basis, and I have bad credit but earn £45000 a year.We have decided that it would be best for him to get the mortgage alone as with my credit rating we would probably end up getting declined. The only credit commitment he has is a credit card with a balance of £500.
Are there any lenders that look more favourably on overtime when working out how much we can borrow? Are there any other lenders apart from Halifax that do gifted deposits?Also is it worth me going with him to see Halifax and explaining that we also have my income available for spending and bills etc even though it will make no difference.
Thanks for your help
Gina

happybroker

Hi Gina,

There are plenty of lenders out there who will take into account overtime if it's regular.

Vendor gifts are not, however, that popular amongst lenders, many considering the property as being sold over value. Most will assume that the purchase price is being reduced by 5%.

This would mean in your case a purchase price of £95000, less your deposit gives you a 95% mortgage on which rates are currently not great.

There are schemes out their where the lender will accept the vendor deposit provided you are putting 5% in also which, from what you have posted, you could do. The rates on these schemes ten to be a little better.

How bad is "bad credit"? Some people have a much worse idea of bad credit than others.

You have an excellent joint income, could you get together a larger deposit as this would open your options further.

I think this is possible. Speak to a whole of market broker, try and get a recommendation from a friend if possible.

Food for thought!

Good luck.

househunter81

Hi Thanks for the reply,

I have checked my credit report and the problem is a default from Oct 07. I think our only option if we want to buy now is to try and get a sole mortgage in my boyfriends name.
Do you know of any lenders that use a high proportion of regular overtime when working out how much you can borrow? Halifax told me they could take 60% of overtime, someone else mentioned RBS might do 100% but I can't see anything mentioned on their website.

Many thanks
Gina

happybroker

how much is the default for and is it settled?

househunter81

It was for £450 once all the chargers were added on and yes it is satisfied, thanks

happybroker

Try royal bank of scotland, the information they give brokers is that we shouldn't submit applications with more than 3 "bad events eg ccjs" which given your high joint income compared to the loan amount you would have a fighting chance for a joint mortgage.

they will also allow 100% of other "reglar income" which if overtime is paid every month then is regular and on your partners income their intermediary website states a max loan of £112,700 on repayment over 25 years so would potentially fit on this alone.

They don't accept vendors gifts but lend 95% of the purchase price which would effectively be £95k after taking the vendors gift out of it.

Obviously i don't have as much information as i would like so please don't take this as a formal recomendation, merely a clue as to who may be able to help! It would still be a really good idea for you to seek advice.

Good luck, I am sure it will work out well.

Kevin

househunter81

Hiya,
Just an update and a few more questions! Hope thats ok. We tried halifax first and have a mortgage promise from them for £90250 with us paying 5% deposit and the vendor paying 5%. Luckily the vendor accepted a lower offer. We have paid the valuation fee and are using lawyers recommeded by Halifax, but have to go back into Halifax in a few days to complete the mortgage. I was just wondering what happens when we go back do they have to do further credit checks etc they did this the first time she said all we need to bring is passport and proof of address as she has copies of payslips etc. Also how long does this ususlly take? The sellers say they want to complete by end of July.

Thanks for all the help
Gina