Mortgage - first time buyer
Discussion
Hi,
I'm currently looking into buying my first house. I have been looking around the local area, and found a nice detached bungalow in a quiet area at a decent price. It's listed at £150,000, but I'm not sure if I could get a mortgage to cover that. Here are my current circumstances:
- £15,000 deposit (could possibly stretch to £20,000 if necessary)
- £20,000 per year income before tax
- Low outgoings at the moment, only car insurance, petrol, and food (although this would obviously change if I bought my own home)
- Good credit rating, spent a lot of money on my credit cards over the last couple of years and never missed a bill
- Could afford repayments of up to about £600/month
- Sole mortgage
If I managed to buy the house for £140k (£10k less than list price), that would mean I need to borrow ~£125k. Is there any chance any company would offer me a mortgage of this size, or am I looking far too high? This works out as about 6x my salary, but I've heard that they look more in depth at what you can afford these days, rather than simply basing it on salary. The online calculators aren't much help.
Thanks.
I'm currently looking into buying my first house. I have been looking around the local area, and found a nice detached bungalow in a quiet area at a decent price. It's listed at £150,000, but I'm not sure if I could get a mortgage to cover that. Here are my current circumstances:
- £15,000 deposit (could possibly stretch to £20,000 if necessary)
- £20,000 per year income before tax
- Low outgoings at the moment, only car insurance, petrol, and food (although this would obviously change if I bought my own home)
- Good credit rating, spent a lot of money on my credit cards over the last couple of years and never missed a bill
- Could afford repayments of up to about £600/month
- Sole mortgage
If I managed to buy the house for £140k (£10k less than list price), that would mean I need to borrow ~£125k. Is there any chance any company would offer me a mortgage of this size, or am I looking far too high? This works out as about 6x my salary, but I've heard that they look more in depth at what you can afford these days, rather than simply basing it on salary. The online calculators aren't much help.
Thanks.
RB5 said:
Hi,
I'm currently looking into buying my first house. I have been looking around the local area, and found a nice detached bungalow in a quiet area at a decent price. It's listed at £150,000, but I'm not sure if I could get a mortgage to cover that. Here are my current circumstances:
- £15,000 deposit (could possibly stretch to £20,000 if necessary)
- £20,000 per year income before tax
- Low outgoings at the moment, only car insurance, petrol, and food (although this would obviously change if I bought my own home)
- Good credit rating, spent a lot of money on my credit cards over the last couple of years and never missed a bill
- Could afford repayments of up to about £600/month
- Sole mortgage
If I managed to buy the house for £140k (£10k less than list price), that would mean I need to borrow ~£125k. Is there any chance any company would offer me a mortgage of this size, or am I looking far too high? This works out as about 6x my salary, but I've heard that they look more in depth at what you can afford these days, rather than simply basing it on salary. The online calculators aren't much help.
Thanks.
I don't understand how your numbers would work. £20k equates to around 1300p/m. Take average base rate of 7%, mortgage rate will then be around 10%, costing £1150p/m, leaving £150p/m to live on.I'm currently looking into buying my first house. I have been looking around the local area, and found a nice detached bungalow in a quiet area at a decent price. It's listed at £150,000, but I'm not sure if I could get a mortgage to cover that. Here are my current circumstances:
- £15,000 deposit (could possibly stretch to £20,000 if necessary)
- £20,000 per year income before tax
- Low outgoings at the moment, only car insurance, petrol, and food (although this would obviously change if I bought my own home)
- Good credit rating, spent a lot of money on my credit cards over the last couple of years and never missed a bill
- Could afford repayments of up to about £600/month
- Sole mortgage
If I managed to buy the house for £140k (£10k less than list price), that would mean I need to borrow ~£125k. Is there any chance any company would offer me a mortgage of this size, or am I looking far too high? This works out as about 6x my salary, but I've heard that they look more in depth at what you can afford these days, rather than simply basing it on salary. The online calculators aren't much help.
Thanks.
Sorry to rain on your parade, but not a chance in hell.
Only chances you've got (I'm speaking over here, Belgium):
1) Find a partner who will take the mortgage with you.
2) Be able to do a deposit of 20%, so in your case about £30000. The bank will be inclined to do this as they will always win, if you can't pay your mortgage, they have a house worth 20% more as what they paid.
Do not forget this 'll mean you'll only lend 120k, and the house is worth 150k, so no money for furniture/notary costs/... is in this calculation.
I don't know, what's the notary costs you guys have on a first (small) property?
Over here it's 5% on your first property (if it's not too big, don't know the exact amount it should be below, and you have to live in it so not rent it out), and from then on 10%.
If it's also "just" 5%, that's another 7.5k you have to find, and is to no added value for the house.
Only chances you've got (I'm speaking over here, Belgium):
1) Find a partner who will take the mortgage with you.
2) Be able to do a deposit of 20%, so in your case about £30000. The bank will be inclined to do this as they will always win, if you can't pay your mortgage, they have a house worth 20% more as what they paid.
Do not forget this 'll mean you'll only lend 120k, and the house is worth 150k, so no money for furniture/notary costs/... is in this calculation.
I don't know, what's the notary costs you guys have on a first (small) property?
Over here it's 5% on your first property (if it's not too big, don't know the exact amount it should be below, and you have to live in it so not rent it out), and from then on 10%.
If it's also "just" 5%, that's another 7.5k you have to find, and is to no added value for the house.
Pretty much what I expected really! I can bring in up to 20k a year on top of my salary through freelance work but it's not reliable income so I wouldn't feel comfortable basing a mortgage around it.
House prices in my area start at about £100k so I think I'd struggle to get a mortgage in any of them at the moment! I think the best option is to continue renting for a few years and see what happens with interest rates whilst saving a bigger deposit.
House prices in my area start at about £100k so I think I'd struggle to get a mortgage in any of them at the moment! I think the best option is to continue renting for a few years and see what happens with interest rates whilst saving a bigger deposit.
RB5 said:
Pretty much what I expected really! I can bring in up to 20k a year on top of my salary through freelance work but it's not reliable income so I wouldn't feel comfortable basing a mortgage around it.
House prices in my area start at about £100k so I think I'd struggle to get a mortgage in any of them at the moment! I think the best option is to continue renting for a few years and see what happens with interest rates whilst saving a bigger deposit.
Sensible. If you've got the freelance income, bank it, up your deposit. A couple of years & you will have a good sized deposit, need less of a mortgage and you will be laughing. House prices aren't going anywhere fast in the next few years, other than maybe down.House prices in my area start at about £100k so I think I'd struggle to get a mortgage in any of them at the moment! I think the best option is to continue renting for a few years and see what happens with interest rates whilst saving a bigger deposit.
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