Active discussions

Meet the Other Phone. A phone that grows with your child.

Meet the Other Phone.
A phone that grows with your child.

Buy now

Please or to access all these features

Talk
Money matters

Find financial and money-saving discussions including debt and pension chat on our Money forum. If you're looking for ways to make your money to go further, sign up to our Moneysaver emails here.

Original poster

Do lenders apply same criteria to divorcing people as first time buyers?

16 replies

FSVC · 03/01/2017 13:43

I'm hoping to buy the family home from my husband. Divorce settlement should give me a deposit of about a fifth of the outstanding mortgage, I can make the payments but I have a credit card debt (four figures, will be gone in 2 years) I'm paying off as quickly as I can (from when we had preschoolers in ft nursery which cost more than my salary!) and am panicking after reading on here and MSE about how strict they are now. I don't have three years to pay the debt and save more for the deposit, it needs to be this year.
If I can't buy this house we will have to go live in one room with family, change schools etc so it's stressing me out! I spoke to a mortgage advisor but they told me the divorce settlement needed to be finalised before they could help.

Is there any organisation who can give me an idea? I'm so worried we'll be homeless. We can't downsize to anywhere cheaper, tiny house in cheap area as it is.

Any advice would be gratefully received Flowers

OP posts:
Original poster
FSVC · 03/01/2017 13:44

I have done a budget for me by myself btw and am trying to save as much as possible. I'm full time employed in public sector professional job so no scope to increase earnings just now.

OP posts:
Original poster
FSVC · 03/01/2017 13:49

Also have an inheritance due which would prob clear the debt - do I clear the debt or use it as a deposit? Long term smaller mortgage better (cc is 0%) but don't know if lenders would see it like that?
The outstanding mortgage is just over twice my annual gross salary and house worth about 4x my annual income.

OP posts:
RedHelenB · 03/01/2017 13:56

Maybe you could ask for more of the equity if you have the children living with you. Can you afford the current mortgage on your own? If so there is no hurry and the courts wont order a house sale, you will have time to buy your stbx out.

Original poster
FSVC · 03/01/2017 14:01

There's no more equity for me to have unfortunately! until it's sorted we are still living together as can't afford to lose money on a rental, and he can't buy anywhere new till this house is sold, the uncertainty is doing my head in Xmas Confused

OP posts:
Original poster
FSVC · 03/01/2017 14:03

I should have said, there's not much equity in the house as prices have dropped since it was bought. My estimated deposit is based on what I was advised by a solicitor (who I can't afford to engage so hopefully going to use mediation).

OP posts:
PlayingGrownUp · 03/01/2017 14:05

You will need to go through an affordability check with any lender - a test to see if you can afford the mortgage. Depending on the mortgage company depends on what their reaction will be.

Original poster
FSVC · 03/01/2017 14:12

Yeah I know and if I was a plain first time buyer it'd be a no, hence the stress! I can afford the payments, in theory they would be lower than the current ones, but they don't seem to look just at that. It's not a joint one now so not as easy as just buying him out.

OP posts:
titchy · 03/01/2017 14:12

Are you selling the house you're in, or buying it from your ex? You've stated both in your posts...

Original poster
FSVC · 03/01/2017 14:19

I'd be buying it from him, sorry I didn't mean to be confusing. In a bit of a tizzy this afternoon Sad

OP posts:
RedHelenB · 03/01/2017 14:42

I got mine with the Halifax. The advisor told me what I could borrow and that CTC, Maintenance and CB all counted towards my income. This was 10 odd years ago though.

titchy · 03/01/2017 14:42

So why do you think you need a deposit when there's equity in the house?

Are you getting the entire house and just taking on the outstanding mortgage or are you also having to raise money to pay ex off?

Sorry it's really unclear!

On the face of it if the mortgage you need to take on the house is only twice your salary that should be easily enough to satisfy any lender, even taking into account your credit card repayments (the annual amount you pay on the ccs will be taken off your annual salary, and childcare might also be taken off, then the net amount used to calculate the maximum loan).

Original poster
FSVC · 03/01/2017 14:52

Therrs a little bit of equity and then some other assets which will get split to make my deposit. I thought I'd need a deposit on the outstanding to raise a mortgage and also make it as small as possible? I know nothing! Sorry to be vague but my situation is quite unique and want to stay anon...

OP posts:
Original poster
FSVC · 03/01/2017 14:52

Thanks btw, the last two posts have got me down off the ceiling a bit!

OP posts:
RedHelenB · 03/01/2017 15:17

If the mortgage would be within your income range then you could trade other assets for all of the equity.

Original poster
FSVC · 03/01/2017 15:35

They aren't my assets that we are splitting Xmas Blush but yes, solicitor suggested various options about the equity perhaps offset against maintenance. Thanks.

OP posts:
DustyMaiden · 03/01/2017 16:19

There maybe some leeway depending on the Loan to valuation, how much is the market value of the house? How much is the loan?

New posts on this thread. Refresh page