First time buyer advice

[Diablos-666]

If i had £15k to use as a deposit is the maximum mortgage I should expect to be given be £135k? (the £15k being the 10% deposit on a £150k property)


Would the banks look at any other critera to be able to release a few more £k?

[theaxe]

I doubt you'd be able to get anything better than a 90% LTV.

[Diablos-666]

Yeah, that's what i thought

thanks

[Mattt]

Speak to PHer Scotal - was very helpful for me

[theaxe]

Actually I may be wrong. There are some 95% deals here, most seem to be for existing owners though.

[Kudos]

Theres a lot of other variables to take into consideration as well- salary, outgoings etc

[Sarnie]

Kudos said:

Theres a lot of other variables to take into consideration as well- salary, outgoings etc

Yes but they are irrelevant if he only has a £15k deposit. He wants to borrow more than £135k, but with only a £15k deposit he is going to struggle. And thats the case for if he was earning £20k or £100k.

[JayBM]

Mattt said:

Speak to PHer Scotal - was very helpful for me

Can only agree whole heartedly with the above, in the process of remortgaging with his help

[hamski]

Yorkshire Bank/Clydesdale have a 95% deal, but the rate's not great. And Bath BS

[DavidHM]

A colleague of mine was about to sign a 95% deal - but that "extra" 5% is at kneecap rates.

Deal seems to be gone off MoneySupermarket now.

[Jettagti]

Ive just bought my first place. The property was 140k,but we were eligable to borrow 230k based on our very average earnings. To get a decent rate though, we had to have a good deposit, we ended up putting in 23k as our deposit to secure a rate that wouldnt cripple us

[vinnie83]

Diablos-666 said:

If i had £15k to use as a deposit is the maximum mortgage I should expect to be given be £135k? (the £15k being the 10% deposit on a £150k property)


Would the banks look at any other critera to be able to release a few more £k?

To purchase a property, there is nothing above 90% on the market. Also, you will get a pretty crappy interest rate too.

[Diablos-666]

The rate will be crappy but could offset that cost against buying a a property when values are low instead of a better rate when property values have increased?

[Fume troll]

Sarnie said:

Kudos said:

Theres a lot of other variables to take into consideration as well- salary, outgoings etc

Yes but they are irrelevant if he only has a £15k deposit. He wants to borrow more than £135k, but with only a £15k deposit he is going to struggle. And thats the case for if he was earning £20k or £100k.

Except suitable cash flow he could take out a personal loan for another chunk of deposit.

Cheers,

FT.

[vinnie83]

Fume troll said:

Except suitable cash flow he could take out a personal loan for another chunk of deposit.

Cheers,

FT.

Lenders aren't stupid, if it was that easy everyone would do it. Not to mention the fact that a personal loan would be over a short term which would mean higher repayments - if the OP had a significant disposable income then saving a bigger deposit is far wiser advice.

In summary, if you can afford to pay your new mortgage and the payments on a personal loan (which will be at a much higher rate) then surely you can afford to save another 5-10% of a deposit.

[Jettagti]

A lot of people take out a personal loan to bump up their deposit. You get the mortgage agreed in principle, then you take out the loan to bump up what you actually have to whatever you told the building society you had as a deposit. Its quite common

[Scraggles]

OP has made the assumption that house prices will increase, for the past few years they have not been increasing

[anonymous-user]

Scraggles said:

OP has made the assumption that house prices will increase, for the past few years they have not been increasing

Where has he made that assumption?

[Fume troll]

vinnie83 said:

Lenders aren't stupid, if it was that easy everyone would do it.

People do it all the time. It's unsecured so has nothing to do with the house.

vinnie83 said:

Not to mention the fact that a personal loan would be over a short term which would mean higher repayments - if the OP had a significant disposable income then saving a bigger deposit is far wiser advice.

In summary, if you can afford to pay your new mortgage and the payments on a personal loan (which will be at a much higher rate) then surely you can afford to save another 5-10% of a deposit.

Yes, saving a bigger deposit is wise, and clearly if you can get a personal loan you can afford to save. However you're missing the time based component. The OP may have reasons for not wanting to wait that long, and if his cash flow is suitable it's certainly an option to help him buy sooner rather than later.

Not for everyone's situation.

Cheers,

FT.

[anonymous-user]

Fume troll said:

People do it all the time. It's unsecured so has nothing to do with the house.

They also ASK you if you have any loans etc when applying, if you lie I guess you are committing fraud.