How much mortgage could I get?

rossyl

rossyl

rossyl

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I earn £33,000 a year.

I want to buy a house that costs £250,000

I need a mortgage.

As for deposit I reckon i could get £15,000
 
Do a google search for Martins Money.

Its an excellent website and you will be able to get some good advice there.

or you could always speak to your bank ! lol
 
Nobody uses simple salary multiples any more, but think around 4 times your salary as a good starting point, although different lenders will vary. You will need to take in to account things like any other loan payments (Student Loan does count), and credit card balances too.

At £33k per year I would guess at £130k-£145k as a rough estimate. IMO there is no way you are going to get a mortgage of £235k on that salary.

Then there is your deposit, obviously you will need to use a lender that will give you a 95% loan, so you need to look around for that. And I'm assuming that £15k is outside of stamp duty and fees, as at £250k you are looking at 3% stamp?

Best place to start would be an online calculator with some of the big lenders as this will help give you more of an accurate figure.
 
Last summer I'm sure you could have got a mortgage for that amount.

What you're asking for is a 94% LTV at over 7x your salary - I very much doubt anyone would give you that now.
Besides could you really afford around £1,500 a month (which is what a £235K mortgage would cost) on a £33K salary?
 
Well i can afford £1,000 a month, and I plan to rent the second room at £500 a month - which is a decent price, and so i should be ok.

I realise that it's a risk - if the room doesn't rent for a while etc. But I am willing to risk it, got to risk things at some point!

Halifax online calculator says £150,000. Way too low.
 
rossyl said:
Well i can afford £1,000 a month, and I plan to rent the second room at £500 a month - which is a decent price, and so i should be ok.

I realise that it's a risk - if the room doesn't rent for a while etc. But I am willing to risk it, got to risk things at some point!

Halifax online calculator says £150,000. Way too low.
Click to expand...

You may be able to risk it, the bank won't. "Renting a room out" will not count in the eyes of the bank. Or at least it didn't last time I looked. You have to be able to afford it solely, or apply for a joint mortage.
 
rossyl said:
Well i can afford £1,000 a month, and I plan to rent the second room at £500 a month - which is a decent price, and so i should be ok.

I realise that it's a risk - if the room doesn't rent for a while etc. But I am willing to risk it, got to risk things at some point!

Halifax online calculator says £150,000. Way too low.
Click to expand...

IMHO taking a risk on the housing market is an utterly foolish thing to be doing at the minute.
I would ony be buying a house now if I wanted something for the long term and knew damn well that I could afford the payments.

The banks likely won't lend you that sort of money as they are all being very risk averse at the minute anyway.
 
jdickerson said:
"Renting a room out" will not count in the eyes of the bank. Or at least it didn't last time I looked.
Click to expand...

Nope, they won't use it for the exact reason that you have just said, if you don't rent it you can't afford the payments. When looking at income they will usually only go on earned income.
 
SOLUTION!!

SOLUTION!!

My parents will get a second mortgage for £100,000

I will borrow £150,000

= £250,000

I will make repayments for all at £1,500

I will rent a room for £500. - THE RISK.

As for a house price crash - i don't think there will be, and I think with the worries at the moment its a good time to buy as people are willing to take a lower amount as they fear a crash.

However, with mortgages not being given, and housing not selling, i can see how there could be a crash.
 
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rossyl said:
Well i can afford £1,000 a month, and I plan to rent the second room at £500 a month - which is a decent price, and so i should be ok.

I realise that it's a risk - if the room doesn't rent for a while etc. But I am willing to risk it, got to risk things at some point!

Halifax online calculator says £150,000. Way too low.
Click to expand...

I pay £925 a month, and that's with a mortgage of £165k over 40 years. £1k a month on £235k? No chance, even on a 40 year term. With the current interest rates and cack 'deals' currently available, try nearer £1.5k/month!

Wait a while and see what happens.

/edit

Just seen you last post. That's more sensible/viable, but do your folks want paying back? £150k over 40 years would probably be ~950 a month IF you can get a sensibleish deal. Our rate is currently 6.29 on a tracker which was set up last month.
 
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danza said:
I pay £925 a month, and that's with a mortgage of £165k over 40 years. £1k a month on £235k? No chance, even on a 40 year term. With the current interest rates and cack 'deals' currently available, try nearer £1.5k/month!

Wait a while and see what happens.
Click to expand...

I expect to pay £1,500 in repayments.
I HOPE (pray) to rent out the second room for £500.
 
Too many risks.

First is that arguably you are buying at the top of the market. Prices are currently falling and good mortgage deals are hard to find. Don't expect any decent mortgage considering you need at least £150k on a £33k salary, thats over 4.5x your salary. You will probably find it hard to get somebody to lend you that multiple with only a 15k deposit.

Secondly is if the worst happens and the market does indeed crash by 20-30% that is not only going to leave you in the brown stuff you are also gambling with your parents house. It might not put them in negative but you are going to eliminate a big chunk of their equity making mortgage deals more difficult for them.

You are mad trying to borrow £250k on a 33k salary, hence why the banks wouldn't lend it to you.
 
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