Would you give me a mortgage at these figures?

[Wouldyougivemeamortgage]

I've got a telephone appointment with a mortgage advisor this evening but I don't want to waste their time if I've not got a cat in hells chance. Here's my situation, does anyone have any experience in mortgages and would I have any luck at buying the house I'm looking at which is £160k.

Earn £32000 per year on PAYE
Plus around £10000 self employed income (only last 12 months no accounts)
Deposit of £10000
Car finance agreement £250 per month
Loan which I'm overpaying, have about £7300 left on it at a min payment of £200 per month, hope to pay off in 2 years.
No other debt and very good credit rating.

Anyone have any advice?

[Shrewsdoodle]

You might struggle with a run of the mill high street bank mortgage, particularly with a less than 10% deposit, so definitely speak to the advisor! They're the people to talk to for complicated cases, if your circumstances were straight forward there'd be little point seeing an advisor IMO. Good luck!

[Megan2018]

I’ve been able to borrow 5.1 x salary but that was with a large deposit (about 40%) and a public sector job (was at the time considered lower redundancy risk). You can’t usually push the multiplier with small deposit, it’s one or the other.

[liverpool1981]

Hi when on the telephone just ask reference the criteria make sure they dont start credit scoring you as this could have an impact on your score longterm. you need an affordability check first then speak to a broker who has access to all of the market and also its important to check with your current account provider as they will want to work with you and keep your business and they will have a track record of dealing with you and all branches want new business building relationships and cross selling and they can sometimes speak directly to underwriters who can push cases through

[Chocolateandamaretto]

I’ve bought a house on a 5% deposit - the interest rate was cack. I’d suggest paying off the loan then saving the loan repayments.

Still speak to a broker though, they are so so helpful and knowledgeable and worth their weight in gold. They were happy to speak to us even when we knew we weren’t going to be able to buy a house at that time and then when we did buy we went back to them.

[wantmorenow]

Can you sell your car and pay off a loan. Buy a cheap runaround.

[2007Millie]

@okiedokieme

I'm so confused on how your income is 150k but you only borrowed 200k max?

[Queenoftheashes]

You can get 95 percent mortgage still. I just plugged your details into Nationwide’s calculator and there are products available at that LTV. But affordability wise they’d only lend you 132k or so. It’s easy to find out eligibility - all the providers have online affordability calculators. I’d say keep saving if I were you and try to pay off your loans before buying.

[LinemanForTheCounty]

Over commitment via mafia and blackmail bungs.

[Xenia]

Traditionally you could borrow 3x 1 salary (or 2.5x joint salaries) but that was when interest rates were about 10% not 2 or 3% so now they do tend to allow may be 4x salary? even so at £32k PAYE salary only getting above about £100k would be hard.

[cyclingmad]

Just aa the last recession recovered I purchased my house I was on £35k so just a bit more than you and i was asking to borrow £180k with a 35% deposit. The sellers wanted 5k more and the bank wouldnt stretch my borrowing by 5k despite the large deposit and zero debt.

So I think it's going to be very difficult to find one and if you do you will get a poor rate.

I am with others, pay off your debt with existing deposit money and then put everything aside to build it up again.

[dobbleby]

Traditionally you could borrow 3x 1 salary (or 2.5x joint salaries) but that was when interest rates were about 10% not 2 or 3% so now they do tend to allow may be 4x salary?

And this is one reason we are stuck with low interest rates.

[Alarae]

I would look at various affordability calculators. I quickly ran it through Santander and they would only lend 56k.

With your high monthly credit commitments, I don't hold much hope you would get a 95% mortgage. Your credit commitments at £450 a month are about 18% of your annualised monthly income.

I think you might need to keep saving on this one to bolster your deposit.

[heidihigh]

Me and my partner are currently looking to buy our first house. Spoken to a mortgage broker who said 90% LTV mortgages (so 10% deposits) are really thin on the ground at the minute, a 15% deposit will increase options hugely. Obviously, this may change but at the minute I'd say, like me, that your chances are slim

[Bells3032]

I received 5 times my salary but I was putting down a 33% deposit (No idea where people are getting that there is a legal max cos there isn't) and had no other debts bar my student loans. I think you may really struggle to get that but it's not impossible

[tootiredtospeak]

Wait for the broker lending has been impacted by COVID and most lenders have reduced how high they are prepared to lend. 90% is probably the highest you could get and that wont be easy so you would need at least a 16k deposit. 4.5 times salary is standard but some may still push up to 4.75 the broker is the one who will know which lenders are still doing this.

[tootiredtospeak]

No one is doing 95% lending at the minute....not a chance.

[BrightYellowDaffodil]

I would absolutely talk to a broker (I found L&C very helpful).

My circumstances were very similar to yours in terms of income/mortgage required and I didn't have a problem getting a mortgage. Your loan and the current circumstances might change that which is why I'd definitely go to a broker as they often have special broker-only deals available to them and they know which lenders have lending criteria that would work in your favour.

Worst case scenario - would you be able to wait until the loan is paid off and you've perhaps been able to increase your deposit?

[Ravenclawgirl]

I don't think you would get a mortgage at the moment because your deposit is too small. My son and DIL were going to buy a house before the lockdown and now can't get a mortgage without a 15% deposit at least. if you look around 85% is the highest LTV mortgage available to first time buyers at the moment.

[Marnie76]

Where’s the OP? 😳

[Cloverforever]

I don’t think she liked the answer @Marnie76!

[ToothFairyNemesis]

Your deposit is too low and you need to pay off your loan first. I would have a minimum of 20k deposit on your salary.
Try here as a guide.
www.nationwide-intermediary.co.uk/calculators/affordability-calculator

[ToothFairyNemesis]

That’s a broker calculator.

[Wouldyougivemeamortgage]

Thanks for all of the replies.

Sorry I disappeared, it was nothing to do with not liking the replies, but for my £32k a year I have to work @Cloverforever and to all the rest for the snarky comments.

Thanks to those who bothered to reply constructively. That's why I asked really, I wasn't sure and I didn't want to waste anyones time.

[QueenCT]

Mine is a remortgage but I'm borrowing 85k and earn around 25k if that helps. And my credit score is shocking

[Marnie76]

It’s still worth talking to the mortgage advisor OP, at least then you will know what to aim for.
I hope you get on ok.