Mortgage Advice.

sham69

Hi,
I know there has been hundreds of these posts so apologies but I am desperate for some advice.
I am 34, living in rented accomodation (paying 600 a month), have some small debts, bank loan 3k, cards 4k.
I have no savings as such (1k) but have or will have between 15-20k gift from my parents depending on how much I will need.
My salary is 31.5k and my job is relatively safe for a few years.
I am looking at a property that is 250k and was wondering if the bank will entertain my application. I applied for my credit rating from the ICB and its pretty good so no worries there.
Any advice greatly appreciated.
Thanks.

ps My GF will be living with me but she is unemployed and has a bad credit rating so I can't put her down on the mortgage application.

Xiney

Use the gift to pay off your debts.

you simply are not earning enough for a 250k mortgage - it's nearly 8 times your salary. Typically banks won't lend that much.

sham69

Thanks for the reply.
I got in touch with a broker about 6-8 months ago and he took my details and said I could get a mortgage of 240 IF I had a deposit of 20k and planned to rent a room out.
I know things have changed dramatically since then so I just wanted to see what the banks are offering without going to the bank and being laughed at.
I checked the repayments on a 250k mortgage over 35 years and could easily afford it on top of bills and living costs etc.
Thanks again for the reply.

godtabh

sham69 wrote: »

Thanks for the reply.
I got in touch with a broker about 6-8 months ago and he took my details and said I could get a mortgage of 240 IF I had a deposit of 20k and planned to rent a room out.
I know things have changed dramatically since then so I just wanted to see what the banks are offering without going to the bank and being laughed at.
I checked the repayments on a 250k mortgage over 35 years and could easily afford it on top of bills and living costs etc.
Thanks again for the reply.

You have to take into account others things as well

• solicitor fees
• urniture
• management fees (if applicable)
• Etc

It wont be long before your deposit is gone

sham69

Have a mate who is a solicitor so that will be cheap.
I have loads of furniture, all we need is a new bed.
Not sure about management fees though.

sparkyjo

i think you should get a bank or broker a calls it just the information that you are being given is probably sound in the eyes of the people given it but very few people can give you actual advse be cause you haven't given enough info but the only thing i say to you if you are serious about buying somewere get rid of any depts like your card and bank loan as they cut the amount you can borrow

mst banks could give you a quick quote over the phone just make sure yo have all your details ready

sham69

thanks all for the replies, I think I will give the broker a shout again.
Cheers.

astrofool

Get your loans paid off asap, they seriously reduce the amount you can borrow.

sham69

I was making the stupid mistake of saving instead of clearing my debts.
I was worried that the bank would not entertain me if I had no savings but stupidly didnt think they would have a problem with small debts.
I am going to pay off the cards as quick as I can and take it from there.
Thanks all.

ntlbell

pay off all your debt if needed use some of the "gift"

put the rest in a high interest account

find a cheaper place to rent

keep hammering away at the savings.

give it another 6 months or so and re-evaulate.

you should have a much bigger deposit places will be a lot cheaper

etc etc

sham69

Cheers for the reply.
Unfortunately If I pay the debts off every month it will leave me little or nothing to save after rent, etc.
On the plus side I will have the gift money, my parents don't know about my debts and I don't really want to tell them so paying the debts with the gift is not an option.
If I have to wait till the end of the year I don't mind, there is light at the end of the tunnel as the prices are really dropping but unfortunately the banks are being more careful about how much they give and to whom they give it.
Thanks.

howamidifferent

sham69 wrote: »

Cheers for the reply.
Unfortunately If I pay the debts off every month it will leave me little or nothing to save after rent, etc.
On the plus side I will have the gift money, my parents don't know about my debts and I don't really want to tell them so paying the debts with the gift is not an option.
If I have to wait till the end of the year I don't mind, there is light at the end of the tunnel as the prices are really dropping but unfortunately the banks are being more careful about how much they give and to whom they give it.
Thanks.

Stable door...horse...bolted...

gurramok

sham69 wrote: »

unfortunately the banks are being more careful about how much they give and to whom they give it.
Thanks.

That should read fortunately. You will be getting a smaller mortgage with less repayments per month and for less duration(25 as oppose to 35), you'll save a packet.
The rent-a-room thing, you're not going to rent a room to a stranger for years are you?
It defeats the purpose of having your 'own' place with privacy for you and your other half.
Best option, pay off those debts, then you can save more per mth and get best qualified for a mortgage. Time is on your side.

sham69

NO , the rent a room thing was th brokers idea.
As I was saying the missus is out of work at the moment and hasnt got a great credit rating so I will be doing this alone. I think the broker was using the rent a room thing to say to the bank that there is more money coming into the house apart from mine.
Will take all the advice and clear my credit cards as quick as I can.
Thanks again all who replied.
I am just really keen to get out of the house i am renting as it is not in the best of shape and there are 2 kids involved.
Thanks.

astrofool

You're far better off paying off your loans and not saving, then saving and still having the loans.

sham69

thanks astrofool I relaise that now.
I have transferred what little savings I have back to my account where I am going to pay them off my credit cards.
Cheers.

StillWaters

AFAIK bank are no longer taking rent a room income into account.

They are roughly lending about 3 times income. Also they want to see a year of consistent savings, a gift is ok, but they will still need to see the consistent savings.

If you are looking to buy an apartment, you will need 25-30% deposit.

I think you should put your head down for a year, move somewhere cheaper, maybe a houseshare, save like mad, get those debts clear and aim to buy next year as I don't think you will get a mortgage at present.

The_Conductor

devid69- please stop responding to posts from years previous. You've done this twice thus far in this forum this morning alone. Its known as 'zombie posting' resurrecting long dormant threads with spurious comments, so please check what you're responding to- before posting. I'd also suggest reading the forum charter at the root of this forum- if you intend to continue posting here.

Now- thread closed.