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Original poster

Any chance of a mortgage?

19 replies

Screamifuwant2gofaster · 07/05/2017 21:23

We bought a house for 145,000 6 years ago. We've done lots of work on the house since then and it's now in much better condition (likely to be worth more).

We have over 15,000 in savings.

Due to a change in circumstances, I will be unable to work for next two years ( starting in 6 months).

We need to move house (due to life circumstances). My husband will only be earning around 27,000 at least for first year.

Do we have any chance of getting a mortgage? Is there anyway of calculating what we could get?

After a few years I'll be earning again.

Any advice anyone? Reallygot no idea where to start.

Thanks

OP posts:

Suebromley · 08/05/2017 01:04

You havent said how much equity is in house, and how much is house you want to buy? You husband can borrow about x4 his salary so £120k added to the equity in your cirrent place

But with one wage you have to consider his job stability plus whether its financially possible and fair for him to be paying everything for two years, i know my ex wouldnt have allowed it

WhatsGoingOnEh · 08/05/2017 01:13

Do you have a mortgage on your current house? If so, ask if you can port that over to another house.

If you don't have a mortgage already, well then you'd sell your current house and have a fuck-tonne of money (around £160k) so your LTV would be spectacular and you'd easily get a mortgage with your OH's salary.

Original poster

Screamifuwant2gofaster · 08/05/2017 07:52

Yes we have a mortgage on current house. We haven't seen a house yet- trying to get finances sorted first. We would love a house worth a little more than our current house but in our current situation, think it will probably need to be similar price to current house (£145,000).

The issue of whether this is fair on my husband is a bit of a none issue as I have no choice but to stop working (it is not a choice) and he fully supports me. I say he supports me but there literally is no other option.

OP posts:

titchy · 08/05/2017 07:55

So how big is your current mortgage? At a salary of £27 you should be able to get a mortgage of around £90k. Don't forget moving costs though - maybe £5k.

19lottie82 · 08/05/2017 08:23

titchy I had an income of 29k and was offered a mortgage if 140k by Halifax, I think your estimate seems a little conservative.

5x salary is even possible if you see a broker.

OP you need to find out how much equity is in your property then do the maths. But if your husband has a decent credit history, what you are suggesting sounds ok

Original poster

Screamifuwant2gofaster · 08/05/2017 08:43

I am not sure how much equity is in property- I will check. Thanks so much for everyone's input. My understanding of mortgages is not great (as is probably obvious) and am pretty worried about not bringing any money in for such a long time.
Glad to hear it does look like we will be able to do this. My husband has an excellent credit history.
Thank you.

OP posts:

19lottie82 · 08/05/2017 08:50

best first stop would prob be your current mortgage provider, they should be able to
Arrange a valuation of your property and advise you of your options.

Original poster

Screamifuwant2gofaster · 08/05/2017 09:15

Oh really? Thanks. I presume we wouldn't have to pay for initial valuation? We are due to see a mortgage advisor on Saturday as our mortgage is due for renewal. I'll see if I can speak to mortgage lender before then.

OP posts:

titchy · 08/05/2017 09:16

Don't you know how much is outstanding on your current mortgage - really you should have an idea...

titchy I had an income of 29k and was offered a mortgage if 140k by Halifax, I think your estimate seems a little conservative.

Recently? We too got a 5 x salary mortgage some years ago. But lenders are so much stricter now, particularly with applicants with lower salaries. A 4 x may be possible but I'd imagine the interest rate would be higher than normal.

LovelyBath77 · 08/05/2017 09:22

I saw an article in the papers last week about selling up and if you are careful, if you move to a slightly less expensive area you could be mortgage free. Any chance you could downsize a little or depending where you are moving to, look around and possibly achieve this? As then would be a bit easier just on the one salary...or rent your house out and make money on that to finance the new place? Rents are high atm.

sparechange · 08/05/2017 09:23

Speak to a broker like London and Country, but make sure you know in advance what is left owing on your current mortgage and how much the house is worth, and therefore how much you would have as a deposit.

An added compilation of you not working is that your DH might be able to borrow more by applying on his own, than you could get if you apply jointly, so this would mean only his name going on the mortgage and deeds of the house.

This is because banks will usually lend 2.5-3x a joint income or 3-4x a single income
So your joint income is £27k + £0, meaning you could borrow 2.5x that amount, compared to more for just him.

Brokers will have ways around this if you both want to be on the deeds, but it will limit the lenders you can use

Oliversmumsarmy · 08/05/2017 09:25

On my first mortgage it was 2.5 x single salary. So 4x salary seems very generous

ZilphasHatpin · 08/05/2017 09:27

We would love a house worth a little more than our current house but in our current situation

Thats an odd wish list item. Why do you specifically want to stretch yourselves for a house that's worth more when your financial situation is so precarious?

Original poster

Screamifuwant2gofaster · 08/05/2017 09:32

Thanks. That's useful. We did consider renting our current house out but think we have decided against this.
I have always earned significantly more than my husband and he currently earns more than what he will earn in his new job. Our mortgage for our house was/is well within our means. We've always been very lucky not to have to worry about money.
Now suddenly I will be earning nothing. I'm glad we have a little savings but wish we'd saved more carefully. We are going to have to make big changes to our lifestyle.

OP posts:

TooMuchToDoTomorrow · 08/05/2017 10:27

Financial Adviser and Mortgage Broker here!
Mortgage lending is no longer about simple multiples of salary but more about what the particular lender deems you can afford and they all have different criteria in how they make this decision.

Factors they will take into account when deciding on how much to lend include but are not limited to:
Other liabilities outwith the mortgage
Number of dependants
Childcare costs/school fees
Term of mortgage...a lender may be prepared to lend you £x over 20 years but not over 15 for example as according to their criteria it is unaffordable.

Many lenders have a starting point of 5 x income, joint and/or sole but this is easily reduced taking into account the factors above.
It is not out of the question for you to achieve 5 x your husbands salary IF you have no other major items of expenditure and a long enough term.

My advice would be to see a good whole of market broker, don't restrict yourself to your bank/building society as you are stuck with only their products but more importantly, their criteria. The deals that are available at the moment are better than they would have been six years ago and you should have reduced your loan to value through your repayments and increase in value of your property (making assumptions here), putting you in a better position. If you have allowed your mortgage to revert to standard variable rate for your particular lender you might be surprised at the reductions in your monthly payments that you can achieve.

Regardless of the maximum amount of borrowing that you can achieve, the one thing you need to be comfortable with is what you feel you can afford. You appear to have your eyes wide open and know it's going to take some adjustments to your lifestyle and you do have some savings to ease the financial pain.

If you have no plans to move again after this one, consider fixing your payments for a period at least equivalent to the period that you will not be working for. This will give you peace of mind that there will be no shocks or pressures coming from an increase in the base rate.

Good luck!

Original poster

Screamifuwant2gofaster · 08/05/2017 11:11

Thanks-That's really helpful. We have no childcare costs/ school fees.

Our current plan is to move somewhere-live there for 4/5 years- until I'm earning again (but longer would be fine) then buy somewhere a bit nicer.

At the moment, we are both working in our current jobs so obviously we cant try to buy a new house until my husband has new job. Could mortgage be done as soon as he has job offer?? All this is reliant on him getting a job. This shouldn't be a big problem. He's qualified in a job where there are nearly always jobs going..

We also don't owe anything on credit cards.

Thanks.

OP posts:

19lottie82 · 08/05/2017 11:20

Titchy....... that was 1 year ago.
I have banked with them since I was a child though and had various products with them in the past, so maybe that would have something to do with it?

TooMuchToDoTomorrow · 08/05/2017 12:10

Scream Some lenders will have a minimum amount of time with the current employer requirement in their criteria, others will be happy with an offer/contract of employment.

Whilst I can give you information and pointers, the only advice I can give you is to see a whole of market broker who can give you specific advice relevant to your circumstances, loan to value, credit history, income etc...There is no harm in starting that process now, they will be able to advise you on what to do next and when to do it.

Good luck with everything!

Original poster

Screamifuwant2gofaster · 08/05/2017 13:31

Thank you. You've all given me hope that this is doable (with big life style changes obviously). Our mortgage advisor works for countrywide- I understand that they are pretty impartial.

OP posts:

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