What % of your income is spent on a mortgage?

Adam

Adam

Adam

Soldato
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I'm looking to buy a house soon. Everything is in place, I just need to find a suitable mortgage before I can properly start to look.

Based on the mortgage deals around at the moment, i'd be looking to pay £830 per month on my mortgage at a rate of 5.29% (15% LTV).

If I calculate the % of my income that would be spent on the mortgage, this would be in the region of 45%. I am completely debt free (well a student loan which will be repayed in a couple of years) and have no other commitments. This does seem quite high! :eek:

Initially i'll be living on my own, but within a year or so I expect my girlfriend to have finished her uni course and be contributing to the mortgage. I'd also be looking to rent the 2nd room out to cover my bills, this would leave me with around £1000 free per month to spend after mortgage, transport and bills.

How does yours compare?
 
jamief said:
I'd be surprised if you'd be able to borrow that much on your salary.
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We'll see, I know things have changed considerably over the past year but last year I was offered considerably more than I require with a lesser deposit.

Many of the mortgage calculators seems to suggest that I would be able to borrow £160-£165k (combined loan and deposit).
 
Adam said:
Initially i'll be living on my own, but within a year or so I expect my girlfriend to have finished her uni course and be contributing to the mortgage. I'd also be looking to rent the 2nd room out to cover my bills, this would leave me with around £1000 free per month to spend after mortgage, transport and bills.
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When planning a huge decision like this you should always make sure that you can manage if you end up on your own, with higher interest rates. Hopefully that won't happen (the 'on your own' bit; higher rates than currently are guaranteed at some point) but you have to plan for it.

Andrew McP

PS Student debt is still debt. That's why they call it student debt ;-)
 
Andrew_McP said:
When planning a huge decision like this you should always make sure that you can manage if you end up on your own, with higher interest rates. Hopefully that won't happen (the 'on your own' bit; higher rates than currently are guaranteed at some point) but you have to plan for it.

Andrew McP

PS Student debt is still debt. That's why they call it student debt ;-)
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Of course, I totally agree. This is why I plan to go for a medium length fixed rate deal (4-5 years) and I won't be factoring my girlfriend into my calculations as I can't rely on it.

I know the next couple of years will be the toughest, but i'm keen to get on the ladder :D
 
Got a mortgage at the peak in '07, minimum mortgage payment is 30% of my gross salary, though that will change for the better when my fixed rate runs out in August.
 
I'm assuming that £850 pcm is 45% of your take home? If so, your salary is ~£32,000?

I don't know how big your deposit is, so can't comment on affordability. Say your desposit is £30,000, that leaves you with a mortgage of £130,000, which on a salary of £32,000 is unlikely.
 
At the moment it's about 22% of our combined income, but we're overpaying by 100% at the moment to bring it down faster.

We have been told we can borrow up to 6x our combined income by banks, this was only last week. I was gobsmacked, granted that'd be with us having a 25% deposit, but even then we know we couldn't possibly afford it and would be mad to borrow that much. So much for banks being more careful!
 
27% currently, however this will be going up to 33% when my remortgage completes. (Going from variable rate to fixed)
 
jamief said:
I'm assuming that £850 pcm is 45% of your take home? If so, your salary is ~£32,000?

I don't know how big your deposit is, so can't comment on affordability. Say your desposit is £30,000, that leaves you with a mortgage of £130,000, which on a salary of £32,000 is unlikely.
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4x is still perfectly acheivable if you've got a reasonable deposit, which is only 2k shy.
 
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