Getting a Mortage

Stinky · 2 Oct 2006 at 18:52

i have noticed there will be a property coming up very soon that is going to be an awsome inverst buy.

i currently work in an estate agent's so know that it will be hard for me to get a mortage as i am a first time buyer,

i would be buying to let, and the property is £85,000 but is well worth it, the rent would be roughly £390/£400 a month.

problem being i am only 18 its going to be hard work getting one.

where would i try? and what are the chances?

therubble · 2 Oct 2006 at 18:57

Are u buying this place for yourself or to rent, because the mortgage guessing 100% would be arounf 450-500 quid per month.

More than the rental income.

Stinky · 2 Oct 2006 at 18:59

it would be to rent

wolvotim · 2 Oct 2006 at 19:02

As long as the lender thinks that the rent will cover the mortgage you won’t have a problem.

I got my buy to let mortgage for £80K when I was only earning about £16K a year. Some lenders do want large deposits (25%) for buy to let so I hope you’ve got some cash spare

Stinky · 2 Oct 2006 at 19:06

well i dont earn £16,000 a year. i'm in devon. your lucky to get that when your 30odd lol

YoungBlood · 2 Oct 2006 at 19:07

I think getting a 85k mortage at 18 is going to be a big ask, unless your on a seriously good salary. There gonna want a monster deposit i'd of thought. Then there is all the legal fee's

Have you considered maybe going into this with a friend even a parent.

Dolph · 2 Oct 2006 at 19:09

I would advise against buying to let at the moment, you're going to be very lucky if you can break even on that unless you've got a substatianal deposit (say £30k), especially as BTL mortgages generally have a much higher APR than home mortgages (and don't even think about lying to the bank about your intended purpose)

If you really want to do it, speak to an IFA, but to me, I'd guess your sums won't actually add up at the end of it, especially if you're on less than £16k a year.

wesley · 2 Oct 2006 at 19:26

i was told by someone that most lenders will let you "buy to let" if the rent is at least 30% more than cost of the mortgage

ie,

monthly mortgage - £700, then the monthly rent will have to be at least £1,000

[TW]Fox · 2 Oct 2006 at 19:32

Stinky said:
well i dont earn £16,000 a year. i'm in devon. your lucky to get that when your 30odd lol

Don't be daft I'm only on just under that and its a student placement. Whilst Devon is hardly London it's frankly inaccurate to say you are lucky to get £16k at 30.

Youstolemyname · 2 Oct 2006 at 19:34

If you currently work in an estate agency i would suggest asking some of your colleagues.

However, if you currently earn less than 16k you have between zero and no chance of getting a buy to let mortgage to cover 85k.

If you want to invest in property it is probably a better move to get a mortgage on a property you can afford. Banks will lend around 4 times your salary depending on your circumstances...sometimes a bit more. Do it up a bit and sell it on. That way you have no hassle of dealing with tennants and make a tidy profit. Plus it is an excuse to watch Sarah Beeny's ubernorks on property ladder for rennovation tips

Maz · 2 Oct 2006 at 19:37

Get a self cert Mortgage.

I needed to borrow £150k for my first property, and the only way I could borrow that much at the age of 19 (22 now) was by going self cert.

Alibaba99 · 2 Oct 2006 at 19:38

I would have thought that working in a estate agents would make you ideally placed to ask for advice from collegues or get a decent deal from which ever lender is closely aligned to your office.

Rosbif · 2 Oct 2006 at 19:38

£400 rent on a property worth 85k .. an awesome investment?

the property market has topped!

18 year olds are looking to get in on the easy MonEyZ

it must be a top! IT HAS TO BE!

BaZ87 · 2 Oct 2006 at 19:40

Youstolemyname said:
IfHowever, if you currently earn less than 16k you have between zero and no chance of getting a buy to let mortgage to cover 85k.

not true, my Dad is in the process of transfering one of his houses over to my brother, as a buy to let (who doesn't have a full-time job, just temping atm) and the only thing the bank were interested in was, as mentioned earlier, that the rental income was 130% of the mortgage.

Dolph · 2 Oct 2006 at 19:58

[TW]Fox said:
Don't be daft I'm only on just under that and its a student placement. Whilst Devon is hardly London it's frankly inaccurate to say you are lucky to get £16k at 30.

Actually, in much of Devon, you are. The average wage in parts is barely £14k.

http://www.thisisdevon.co.uk/displa...tentPK=15257518&folderPk=83100&pNodeId=143740

cleanbluesky · 2 Oct 2006 at 19:59

Dolph said:
Actually, in much of Devon, you are. The average wage in parts is barely £14k.

http://www.thisisdevon.co.uk/displa...tentPK=15257518&folderPk=83100&pNodeId=143740

I'm betting that's a clear sign of people from London who buy more than one house.

I don't think I could live outside London at the moment, but I would certainly love an easy retreat to the Westcountry.

Alibaba99 · 2 Oct 2006 at 20:02

Maz said:
Get a self cert Mortgage.

I needed to borrow £150k for my first property, and the only way I could borrow that much at the age of 19 (22 now) was by going self cert.

You lied on the mortgage application form then?

Maz · 2 Oct 2006 at 20:32

Alibaba99 said:
You lied on the mortgage application form then?

No I didn't.

I just didn't have to prove my income, which I couldn't do being in a job which is majorly made up of commision.

I could afford the repayments, and I've been making the repayments for over 3 years.

Which is what they were more interested in knowing.

big_white_dog84 · 2 Oct 2006 at 20:48

wesley said:
i was told by someone that most lenders will let you "buy to let" if the rent is at least 30% more than cost of the mortgage

ie,

monthly mortgage - £700, then the monthly rent will have to be at least £1,000

You might wish to reassess your arithmetic.

Dup · 2 Oct 2006 at 21:11

My girlfriend and I have just signed on the dotted link for a 100% morgage for £76k. Property has nicely done kitchen and bathroom already which have never been used. It also has two bedrooms and a small study.

They're not huge rooms, but it's an investment and there's just two of us for now. If we tidied up the other rooms over a couple of years we could find something closer to an area we're used to (born and bred country folks), and afford a decent deposit off the equity.

It's not all cheap and easy going mind. There's lots of up-front fees as you would know, but out Mortgage will cost about the same it would rent a similar property. So now we'll pay the same and have our freedom to paint it wee wee yellow or flourescent pink etc

Our salaries combined add up to £22k at the moment, but my girlfriends will be going up soon, she has to finish her NVQ so we can only struggle until shes finishes that. Shes got a position lined up already if she wants it.

My advice would be find someone else to buy with, a lot of first timers are doing the same these days, as its nigh impossible to live otherwise. We've pencilled in upto a worst case scenario of £400 a month for all bills plus the £350 I pay out for my car insurance etc each month.

£80k at 100% with Northern Rock is about £471 a month, they give 4x sallary multiples + 100% mortgages, but they tnd to run about 4k of that as an unsecured loan alongside the mortgage due to the risk, so you would need to remember to pay some of it off if you wish to ditch them after their tied in period which for us is 2 years.

It's a lot to think about and a potential migrain, but I'm looking forward to getting into my new place.