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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To think the financial system works against people who are actually trying to do the right thing?

64 replies

AnnaMariaWhiskers · 30/07/2015 19:33

OK so I know you can't have your cake and eat it, but we're trying to get a mortgage but have been refused. This is because a) we have student loans because we wanted education to invest in our future b) my dh is paying into a pension which has great returns for the future c) I only work evenings so I can raise my preschool age kids so this doesn't count towards mortgage (no family nearby, expensive childcare cancels out any financial benefit)We have no other loans, HP or even sky TV.
Just a boring rant and I know that I am very privileged compared to 99% of the world's population!

OP posts:
bakingaddict · 30/07/2015 19:41

But it's nothing really to do with the fact that you have student loans or decided to get an education or pay into pensions, it's simply that when all these things are taken into consideration the mortgage company have decided you don't earn enough.

Increase your earning capacity, if you went to uni you have more of a chance of a higher earning job but it's not down to the system just your life choices

Toffeelatteplease · 30/07/2015 19:46

Can I suggest seeing a decent (independent) mortgage broker? Yes they will charge but sometimes they can work wonders

HermioneWeasley · 30/07/2015 19:51

Well, there's a finite amount of money to pay a mortgage and a chunk of yours is going on student loans and a pension.

Agree re independent mortgage brokers though

ConceptOfBiscuits · 30/07/2015 19:56

Agree with mortgage broker- but dont pay.
Have recently used London and Country I would recommend.

StatisticallyChallenged · 30/07/2015 19:59

Childcare costs would have been factored in if you were working full time - they now include it as an expense when calculating affordability. TBH, I think it's right that student loans, pensions etc are taken in to account. Banks were too loose with lending for a long time - this is more realistic even though it is tougher.

19lottie82 · 30/07/2015 20:00

I agree with the other posters.... It's not the fact you have student loans or your dh pays into a pension, it's just that the money you put into these takes away from the amount you can afford in a mortgage.

Student loan payments are a reasonably small fraction of a salary so shouldn't make that much difference?

What's your joint income and how much do you want to borrow?

Athenaviolet · 30/07/2015 20:21

Do mothers who work during the day not also 'raise their preschool DCs'?

Does your dh not 'raise' his DCs because he is out at work all day?

There are plenty of families who both work ft, who never had the privilege of a tertiary education and have no pension access and will never be able to get a mortgage.

Yabu

DoJo · 30/07/2015 20:29

I only work evenings so I can raise my preschool age kids so this doesn't count towards mortgage

Do you mean that the money you earn by working in the evenings isn't being counted as income for the purposes of your mortgage application? That sounds odd.

expatinscotland · 30/07/2015 20:34

YABU. Very. Glad to see banks tightening up restrictions on lending.

Florriesma · 30/07/2015 20:39

Either you are a bad credit risk and hence not suitable for anymortgage or you are asking for too big a loan.

It maybe that not having any loan makes you a higher risk because they don't know that you will pay them on time. Mad I know because we can all think of people with loans and mortgages who have overstretched themselves Fwiw I never apply for any loan mortgage or anything really without having thoroughly researched it myself first. Might be worth using that approach then knowing what you can realistically aim for.

WorktoLive · 30/07/2015 22:12

Do you have credit cards? If not, they don't like that because you haven't proved you can handle credit.

Look on MSE for information on improving your credit rating.

softhedgehog · 30/07/2015 22:14

Agree with mortgage broker- but dont pay.

That's a bit naive, you always pay - either directly or because part of the fee you pay for the mortgage goes to the advisor. How do you think they pay their bills if they work for free?

NotSparta · 30/07/2015 22:46

Was told by a mortgage advisor that the amount they will lend you won't increase if you improve your credit score. They will either lend or not.

Me and dp have no credit cards but the banks will lend to us. The amount we can borrow is limited by our income and outgo etc (still not enough to buy a starter home in our area though Hmm)

So as a pp said, it's either you are asking for too much, or you have poor credit and are a risk.

Getthewonderwebout · 30/07/2015 22:51

See an IFA. You don't need to pay. The lender pays the broker. At least the four house moves/mortgages secured I have had worked that way. The IFA builds up good relationships with lenders, hence them usually being able to secure a preferential deal.

Dynomite · 30/07/2015 22:51

I feel for you, OP. I think the reality is that you just don't earn enough. However the kids will be going off to school in a few years, you can go back to work and you can probably get a mortgage then. You will also have saved up a bit more by then.

I don't think there are a lot of households out there which could afford a mortgage on only one income to be honest.

ppolly · 30/07/2015 22:55

I just think it wrong that house prices are unreasonably high in so many parts of the country. It should be possible to get a mortgage with a small deposit and 3 times a reasonably average income.What is the point in prices that are so out of reach for ordinary people?

DadfromUncle · 30/07/2015 22:56

OP At times I think almost everything seems geared against people trying to do the right thing, in many ways. Hope you get a better answer soon :)

GraysAnalogy · 30/07/2015 22:58

I didn't think student loans were factored in to things like this?

PoundingTheStreets · 30/07/2015 22:59

I think YANBU in the sentiment, but YABU with your sense of realism. Truth is that your current commitments and income aren't compatible with a mortgage lender taking a chance on you. That's just the way it is. However, it's equally true that you are in that situation because you've taken personal responsibility for your future and your children, by funding yourselves through university to get a better job and paying childcare so you can work. I sympathise completely.

Personally, I think the solution is that the state funds students much more, but limits the number of students it funds by funding on merit only in sectors that have demand.

ssd · 30/07/2015 23:02

something doesnt sound right here

why is your income not taken into consideration? it doesnt matter if you work evenings or at 3 in the morning, if you earn it should be included

Hmm
StatisticallyChallenged · 30/07/2015 23:03

They are now graysanalogy - I got a mortgage this time last year not long after the new rules came in to play and they look at income after all deductions including student loan, pension, childcare vouchers, flexible benefits payments etc. They also ask a lot of questions about expenses such as childcare, bills, maintenance...much more thorough than it used to be.

achieve6 · 30/07/2015 23:06

Why isn't your income included? I agree you should see a broker, but don't pay. I know they paid of course, but if you go with them, you will be happier about paying a fee.

And save as much as you can for a bigger deposit, hopefully you are not in London....

GraysAnalogy · 30/07/2015 23:06

Thankyou statiscally I wasn't aware of that.

AyeAmarok · 30/07/2015 23:08

If you're earning enough to be paying back a student loan, and have a good pension, then unless you are either asking for too much money, or you have other debts that you haven't mentioned.

tvlover1234 · 30/07/2015 23:12

Hi me and Oh are 20.

We went to see an independant mortgage broker and he was brilliant.

As first time buyers we qualified for the 95% LTV mortgage. Were going with abbey which is part of santander. We have a total income currently of 31,500. OH getting promotion soon so that will be going up although if course they don't factor that in. We had no credit virtually. I only ever saved and bought. Lived by our means. Only thing we had were phone contracts and car insurance lol.

Mortgage provider was very picky when applying. Asked a lot of things. Even why I had transferred £10 and £13 to my dad (takeaways) lol. OH also bets online twice a month (£5 each time) and they even questioned that but our mortgage broker went back and said people spend much more money on stuff like smoking to he's entitled to spent £10 a month as a treat. Hardly an addicted gambler!! They have really tightened their belts. They even asked why I transfered my sister 400 and a week later she transferred back. It was fora deposit on her wedding dress until she got paid.

It's good in a way but it's also very frustrating for people that can't get mortgages.

Definetly see a mortgage broker if you really think you were unfairly turned down.
Thwy genuinely may think you just can't afford it and to live? We have no children as of yet so childcare Costs did not come into ours but they do ask all of that. Also depends how long you have been in your jobs whether they consider you a safe bet to lend to.

We also both pay into our pensions.

Good luck x