To buy a £700k house on £67k

[Polledja]

My wife and I are looking to buy a house. I was very foolish with my money during my younger days so am behind my peers.
we want a house near a good school and houses in that area range from £550k to £700k. The ones my wife likes are at the higher end but I don’t think we can afford these. She has become withdrawn and depressed during this process and it caused allot of tension.
I have approx £280k for a deposit (this is all our savings bar £18k). We can borrow £350k based on our joint salaries of £67k. It leaves me £90k short. I think I could borrow this from family.

our net pay is £3900 per month. We would have £2000 tonoay on our mortgage leaving us with £1900 to pay everything else. We have two young kids at school. Our monthly expenses excluding our mortgage are about £1600 so it would meaning having nothing left each month

You have an income of £268k a year but wouldn't take on a £350k mortgage?

@Anotherturnipforthebooks - Just re-read the OP and had misread the figures, but nevertheless no, if I was £90k short of hard cash to actually make the numbers work and would therefore be obligated to family as well as covering the monthly mortgage payments, no I wouldn't.

Tbh I'd call her bluff. I'd refuse to borrow from family, then say to her "go find a broker that can get you the 700k house with our salary and savings" and see her fall flat on her face.

www.landc.co.uk/calculators/

We've recently had a mortgage agreed and the underwriters were brutal I have to say!!!
They scrutinised our bank statements and evwn wanted copies of the childminders invoices and then did an affordability assessment and they looked at our outgoings like food shopping, petrol, literally everything!!

We earn a combined income of £50k a year and so we "assumed" we
Could borrow 5 times that as some of our friends have done before!

We have been saving up and had an inheritance so a fair deposit but with our outgoings told us we could not borrow £250k, the Max we could borrow was £205k with our loan to value (we had about 50% deposit)

It would be worth speaking to an in dependant financial advisor but don't make it unbearable and leave yourself short - we've also got money stashed for "emergencies"!

We did an income and expenditure exercise which was an eye opener😱 aswell but we've got things sorted now but have had to lower what we had in mind.

I’d be looking to at max have a mortgage repayment of 1200 on your current salaries…

www.moneysavingexpert.com/

No you cant afford it. If interest rates shoot up youre screwed, if one of you cant work, youre screwed. Either look somewhere else or save for longer.

What is the length of the mortgage term? Would it be manageable if you made it 40 years?

I am sorry but you'd have to be insane to do this!! I'm not sure you have learned from your younger self, but you can't afford to catch up with your "peers"!

One large outgoing, and you're toast.

One of you loses your job.
You have an unplanned pregnancy.
Your elderly car dies a death.
One of you is ill - reduced income or unable to work.
Your boiler breaks down and can't be fixed.
TV/laptop/fridge/cooker/dishwasher etc needs to be replaced.

You won't be able to afford holidays.
The kids will be limited in terms of activities.
They will have a big fancy house to invite friends back to but you won't be able to afford to heat it.
No cinema trips, no weekends away, no birthday parties, no takeaways.

What happens at Christmas? School uniform buying time? They want to go on a school trip?

All of this in an cost of living crisis with energy bills going up exponentially?

Whereas if you buy a house you can afford, you can also afford to give your kids a good childhood. Is living in poverty the height of your aspirations?

Because that’s what you do on the first rung of the ladder. No pain no gain.

So your wife is making you miserable because she wants you to over-stretch yourself?

Don;t do it.
You;d just be exchanging financial strain for emotional strain, & she won;t be any happier or easier to live with when you can;t make ends meet.

& then you get your house re-possessed as soon as interest rates rise.

Mortgage calculator www.landc.co.uk/calculators/how-much-can-i-borrow-mortgage-calculator/

Of course there’s a limit. Which I think OP is over. But 300k house on 110k income is absolutely no where near it!

Jeeze!

Tie yourself to a life-limiting sum for FOUR DECADES?

How about OP & his wife cut their cloth according to their means instead?

What is your wife doing to increase her own earning potential, so she has an income that can contribute well to a 700k home?

Have you showed her the sums?
She is depressed and withdrawn because you won't buy a house you can't afford, she doesn't sound very bright.

You have a large deposit, well done for saving that. I don't think you should plan to spend over 50% of your income on mortgage payment. I doubt it would pass affordability. If you plan to borrow £90k from family, how would you repay them?

If you want to buy, you will have to compromise on size or location or condition and find something cheaper. Or carry on renting if school catchments are key and keep your deposit invested elsewhere.

Do you both work?

I don't understand what grounds your wife has to be cross with you - unless there is a drip that she is the one with the savings and the earnings and you are not pulling your weight financially.

OP has already stated that it IS the limit.

our net pay is £3900 per month. We would have £2000 tonoay on our mortgage leaving us with £1900 to pay everything else. We have two young kids at school. Our monthly expenses excluding our mortgage are about £1600 so it would meaning having nothing left each month

Surely it isn't necessary to ask the obvious OP as you won't get that approved. Affordability checks do exist, are stringent and loaned money is unlikely to be accepted by the majority of primary lenders as something you can use against the property. It would need to be a gift of funds and the person giving it would need to go through the solicitor with you to say they didn't expect it back at all.

Who is the higher earner here? What does she financially contribute to this and how old are you? Her expectation that you take on huge debt debt solely so she can fulfill her vapid desperation to keep up with the Jones's reflects very poorly on her, as does the pressure she's applying.

As an aside considering yourself behind in life with savings of that amount strikes me as sad, as does a half a million pound house not feeling enough. Tell her to get a better job and earn more if she wants to live above her current means. Protect your deposit when you buy if that is your own money.

And this is exactly why our economy is a mess. Buy a property well within your means. Thankfully you won't get approved for a huge mortgage if you can't afford the repayments.

Plus the £90k they;d have to borrow from family, with no means of repaying it ...

But it’s less of a tie because you’re tied into lower payments. You then make over-payments, when you can, to reduce the term.
It’s very common in london.

I’m on a similar salary but as a single income household. I’m really finding it a stretch with a 225k mortgage and a mortgage payment of approx just under 1/3 of monthly income. How will you pay for any home improvements, holidays etc not to mention savings for new car etc.

I don't think they even facroed in the stamp duty, legal fees and removal costs in to their budget either. The wife sounds pretty stupid and vacuous and if I were you OP, I'd ditch this idiot and run for the hills. She's going to bleed you dry and leave you bankrupt.