Mortgage Lending Criteria
Discussion
Whilst I appreciate most of the answers to this will depend upon specific lending criteria I was hoping for some general pointers.
I'm looking to buy a first house I guess in the next year or two, probably around here so I guess I'm looking at ~£160k for something reasonable.
The questions I have are largely related to how lenders would view my job. I'm training to be a solicitor in the City, but due to the tough competition and the state of the economy it could take some time to secure one and in any case most companies recruit two years in advance. There is also the question of once I'm qualified being offered a position as a newly qualified, as the training contract is for a fixed term of 2 years/18 months.
In short it's all a bit uncertain. In the meantime however I've got a pretty good role at a law firm so am able to save (or try to, damn car) for a healthy deposit. A problem with this is due to the nature of the role I am limited to 6 month contracts, though I can't see that not being renewed for the next 18 months due to the case I work on.
Additionally whilst my basic salary is reasonably low in the grand scheme of things, I have as much overtime available as I want, so averaged out over a year I double my basic salary comfortably.
This is not an immediate concern as I'm not looking to buy right now as I think the market has got a lot further to fall, but it is something I've been thinking about lately.
Whilst the career situation is reasonably uncertain from a lender's point of view I guess job security is an issue for a lot of people they lend to in any case?
That aside would a lender lend on the basis of say your salary as it appeared on your last P60 or would they lend on the basis of your basic salary?
Hopefully by the time I come to buy I should have a deposit in the region of 40-60%, so I am assuming a lot of these concerns on the part of the lender would be nagted by this?
I'm looking to buy a first house I guess in the next year or two, probably around here so I guess I'm looking at ~£160k for something reasonable.
The questions I have are largely related to how lenders would view my job. I'm training to be a solicitor in the City, but due to the tough competition and the state of the economy it could take some time to secure one and in any case most companies recruit two years in advance. There is also the question of once I'm qualified being offered a position as a newly qualified, as the training contract is for a fixed term of 2 years/18 months.
In short it's all a bit uncertain. In the meantime however I've got a pretty good role at a law firm so am able to save (or try to, damn car) for a healthy deposit. A problem with this is due to the nature of the role I am limited to 6 month contracts, though I can't see that not being renewed for the next 18 months due to the case I work on.
Additionally whilst my basic salary is reasonably low in the grand scheme of things, I have as much overtime available as I want, so averaged out over a year I double my basic salary comfortably.
This is not an immediate concern as I'm not looking to buy right now as I think the market has got a lot further to fall, but it is something I've been thinking about lately.
Whilst the career situation is reasonably uncertain from a lender's point of view I guess job security is an issue for a lot of people they lend to in any case?
That aside would a lender lend on the basis of say your salary as it appeared on your last P60 or would they lend on the basis of your basic salary?
Hopefully by the time I come to buy I should have a deposit in the region of 40-60%, so I am assuming a lot of these concerns on the part of the lender would be nagted by this?
stemll said:
If the overtime is contractual (i.e. guaranteed and your employer will say so) then yes it's included otherwise no more that 50% of it will be considered..
Also, don't expect more than 3 or 3.5 times basic any more and not many offering more than 90% LTV.
As I thought. No it's not contractual, there is just as much of it as you want to do most of the time, as the firm gets to bill the client for it anyway.Also, don't expect more than 3 or 3.5 times basic any more and not many offering more than 90% LTV.
I hope I'd be looking at no more than 75% LTV in any case.
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