Cost of living, what are we meant to do???

[Rubylu]

So I have a 6 month old baby, I work full time earn a decent wage for my age of 33k a year at 22.

My partner and I were looking to buy a house this time last year and my mortgage advisor told me I could lend up to 145k on my own, my partner can’t be put on the mortgage due to not long being self employed he also has some debts etc.

Fast forward to now a house has come up in our area for 165k we live near Birmingham so it’s rare for a decent house to be this price as most 3 bed semis round here are atleast 220k however the seller wants a quick sale due to family dying and multiple surveys have been done with no issues.

Because I’ve now had a baby apparently I can only lend 125k? I have a 30k deposit ready. The seller won’t take any less than 165k and apparently my mortgage advisor simply can’t get me any more.
What I struggle to understand is how!!! I take home £2250 a month. The mortgage payments would be roughly £650 a month, that would leave me with £1600 our other bills are about £600 so I would be left with a disposable income of £1000 a month. Now I get we’ve had a baby but he doesn’t cost me a grand a month!!!!! We also get child benefit for him and that covers alot of his needs I spend no more than £100 a month of my own money on him…

I have no car payments no debt etc.
The council won’t consider us because we’d be in too low of a band because of my earnings, we can’t buy even though I have a decent deposit and a decent wage…
If we wanted to rent a small house in this area that would be somewhat average it would cost about £1200 a month. We were renting a tiny flat for £800 a month and have moved back in with my parents in order to buy a house, even though I now apparently can’t.
What do they actually expect people to do😳😳😳

Any advice welcome and would also like to know if anyone else is in a similar situation

I would never put him on the house as it’s all my money

If you were a man saying this you'd be roasted alive

And if he pays towards house costs he becomes legally entitled to a financial benefit in the house if you break up anyway

That would be fraud

Speak to Jus at Trafalgar Square Financial Planning Consultants. He dealt with our mortgages for our But to Let's. See what he can do for your circumstance.

You could even ask if the seller would be willing to rent the house to you with a view to you to buy in say two years. He / She may well want the money now or that might be an option and your rent paid would come off the asking price and you fix the house up as you rent it knowing you will own it fully in due course. Of course you would need a legal agreement drawn up. Just knows his stuff in all of this so chat freely to him.

Hope this helps you out a bit to consider other options.

I don't get anything for recommending him either I just know you're in a bind and I'm trying to assist with another option for you.

Bit of a stretch saying you are being ripped off by privately renting .

Can you get a 2 bed with potential to extend

Speak to a different mortgage advisor and see what they can offer you.

L&C mortgage broker is both free and independent. I've used the twice after being recommended by someone here years back. They were great.

https://www.landc.co.uk/

Are we living I the same country? UK private rental rates are ridiculously high these days. A rip off is a perfectly reasonable description IMO.

That's because women are usually left with the DC in event of a split.
As a woman, always plan for worst case scenario.

Being able to buy a 3 bed semi at 22 on one wage hasn’t been the norm since … the 90’s? Even then I imagine it wasn’t common to do with a very young baby.

if you are taking home £2,200 are you not paying into a pension?

The average amount of money spent on raising a child from birth to 18 in the UK – including housing and childcare costs – is £223,256, according to the latest research from investment platform Moneyfarm. That works out at about £12,400 a year, or £1,030 a month.

This is from the Times Money Mentor website.

Banks and lenders will work on averages and even if you don't spend so much on your child, they don't know that. The average cost of raising a child over its lifetime is an extra £1030 a month compared to not having a child.

It's a difficult situation OP and I feel for you, but the lenders are just protecting themselves. Having dependents does make a difference.

I was told by 2 mortgage companies I couldn't re mortgage my rental property and the mortgage payment went onto the variable rate at the end of my fixed rate. That meant my mortgage payment was £450 more than the rent. I struggled for 7 months then found a mortgage advisor on Facebook who got me 2 mortgage offers no problem. They were £600 less than what I had been struggling to pay on the variable rate.

The well known mortgage advisor told me I couldn't re mortgage (as the rent wasn't high enough for my mortgage - couldn't put it up as a struggling family live there.)
A randomer from Facebook sorted it out for me no problem. He was a proper mortgage advisor though.

My point is there will be someone who can get you the mortgage it just might be someone less well known.

Babies - and the children and teenagers they become - cost a lot more than childcare. Last month school dinners, music lessons, new school shoes and trainers and the deposit for a residential trip for one child cost nearly £400 for one child. That's before you've fed and clothed them! School is only handful of years away
for you, although school dinners are currently free for key stage 1 in England, and residential trips and VAT on school shoes are a while off for you

Interest rates go up.
Relatives who promise to look after babies don't always keep their promises - they find it too tying or tiring, or something better comes up on that day - a walking group or bridge club or something. I've seen this so often.
2nd (and subsequent) babies come along.
Relationships break down.

@Rubylu - I get that it is frustrating, but the banks do know about the financial demands of having a child, and need to keep your repayments realistic within their lending rules.

As for your original question, about what are you supposed to do. Do what millions of people have already done - buy a smaller house, or in a less desirable area (or both).

This is not a cost of living issue. This is a "baby at 22 with a partner with bad credit and no eligible income" problem.

You sound really sorted, you should be proud of yourself by the way. Your partner now needs to get his shit together.

(Also, you borrow money, the mortgage company lends it to you.)

Can you not get on a buying scheme of some sort? They’re not just for key workers like they were in the past.

And if he’s self employed and has debts (which is why he’s not going on the mortgage) banks might not lend to him

Why do you need a 3 bed semi for 3 of you. Can you not start off with a 2 bed that is in your price range, then in a few years look at what sort of position your are in and see if you can lend more

Have you tried Santander? I've plumped your circumstances in (33k, 1 dependant, no nursery costs, c.£130 paid to pension each month, no debt) and it's come out with they would lend up to £146k over 35 years, and up to £152k if you take out a 5 year fix.

I appreciate I might have missed something, but have a play with the calculator here: www.santanderforintermediaries.co.uk/calculators-and-forms/affordability/

The underwriters use that calculator for their lending, so it should give an accurate result.

Only thing I can think of that takes you down further is if the lender will think of your partner as an additional dependant if you say they are moving in with you but not putting them on the mortgage.

The whole world has had to endure price increases with everything. A lot of landlords have also kept rents reasonable. I don’t see rent as a rip-off, I see it as you are paying rent so you can live somewhere surely.

Your partner needs to get an 'employeed' position rather than self employed. That will massively increase your budget and you will be fine.

Get a new broker.

Mine has just done my amounts - I’m newly having a baby (we did it for when he’s born), DH self employed so cannot count income wise and is also down as my dependent as a result, didn’t affect my lend ability at all. I only have to do it before nursery costs.

my broker is also free.

shop around.

Hi, I was in a similar situation in that we were living at parents with a baby to save for a deposit. We ended up having to move 30 minutes from the area we wanted to live and bought a 2 bed terraced to get on the property ladder which needed doing up. We had initially put an offer in to get a 2 bed flat but had issues with the lease so this ended up falling through. We spent around 6 weeks before moving in doing it up (my partner and his family are very practical) I appreciate not everyone is (I'm certainly not) then we moved in and did other bits when we could afford too. My partner did buy the house in his name only because I was very part time looking after baby and working evenings to work around his shifts. I know someone has already blasted doing this but is what it is but he also put he had no dependants when applying for the mortgage. So maybe possible options.. look for a smaller property, find a do upper (if you or family are practical at all) , buy a flat or could you stay at home longer and your partner pay his debts off and work for a company just so he can have a steady income for a while and I think would only need 3 months worth of wage slips? Then apply for a mortage jointly. Im guessing theres a way to ensure your deposit is given back to you if you end up splitting up if its in writing , i dont know of the legalities of doing this but a friend did this as she had 80k inheritance she wanted to make sure she would get back if worst happened. Hope you can find a way round making it all happen 🙂

Even in the early 90s early 20 somethings couldn't buy 3 bed semis!

Get a one or 2 bed flat. That's all you need.

Rents are a rip off in many parts of the country - the landlords seem to expect to have all mortgage and costs paid but at the end of the day they get left with a house that has increased in value - the renter bought them the house in effect

The OP rather proved the point - she is paying more in rent than she wants to pay in mortgage - how can that ever be right and fair ?

Oh dear god 🤦🏻‍♀️ these 'corrections' that nobody asked for are bloody boring. I have second hand embarrassment for you @Pleasemakeitcorrect

What happens if your circumstances change? They will make an allowance for you needing to pay for childcare. The £1000 you have spare every month wouldn’t cover FT nursery which is why they won’t lend you more.