Can only get low mortgage

[anon282428]

After doing some research, the best mortgage/amount I can lend in £90k.

I feel awful. I work full time and thought my job wasn't too bad.

I am single and in my early 30s. But even after saving hard for a deposit, the only amount I will be offered is 90k, which is enough for a 1-2 bedroom flat around here.

Anyone in the same position and can make me feel any better about this? :(

Op the amount you can borrow is dependent on your earnings. If your friends get more they earn more.

What is your annual salary and do you have any debt? What is your job?

Being able to borrow £90k suggests that you earn around £20-25k, which is quite low but some jobs don't pay very well unfortunately.

Is there any chance of retraining for a better paid career? There's a labour shortage at the moment, so if you got into the right industry you could increase your pay significantly.

Major employers like supermarkets and others related to the food industry are paying training costs for HGV drivers, fancy it?

Have you talked to a broker? The online calculators say I can borrow 80-100k, a broker recently told me 160k, I was shocked at the difference!

Another vote here for speaking to a Mortgage Broker. Using the calculators kept our value very low due to childcare costs.
I spoke to a Mortage advisor and they were able to see different deals and had advice that was invaluable - would thoroughly recommend.

I’d have been thrilled with a 2 bed flat when I was single. Cheer up.

So my advice would be to take your time

What this poster has failed to tell you is that there is huge risk in doing this, as the market may increase and price you out as you take your time.

@rainbowunicorn

you keep talking about your deposit as if you think that is part of the £90,000 that you can borrow. It Wouldn't matter What your deposit was, the amount you can borrow is based on your income. you add the amount you have saved to the amount the bank will lend you. you seem to be confused about this .

Quoting this to draw your attention to it OP. Do you realise the mortgage is in addition to your deposit, not including?

I told OP to take their time from my own experience. I wasn't forcing them to do so.

My point was circumstances change. Mine did and now I am stuck. I also had a friend who was so desperate to get on the ladder that he did a shared ownership and it took him 6 years to sell him property in the end.

Yes its amazing getting on the property ladder but it is not always easy to sell and move if your circumstances change

@Bluntness100

So my advice would be to take your time

What this poster has failed to tell you is that there is huge risk in doing this, as the market may increase and price you out as you take your time.

Contrary to that, the market could fall and you'd be in negative equity and your deposit would be all gone, as you'd owe £90k on a flat worth £90k or even £80k. So if you'd waited, you'd need to borrow less, or borrow the same amount but get a better property.

While it's been mostly a rising market for the last few years, it's not always been like that. Certainly post 2007 there were people unable to sell properties they'd bought before the crash for what they'd paid for them - of course, if you don't need to move, you just keep paying your mortgage, but many people found themselves trapped in properties that were unsuitable due to size or location.

Same in the mid 1990s. We paid £32k for a house that the couple we bought it off had paid £40k for 2 years earlier, and they'd spent money on top of that doing it up. They were selling because they'd split up so each ended up with a few thousand in debt - those numbers may seem fairly trivial now, but at the time we both earned about £8k per year, so if this couple earned similar, their debt was a significant proportion of their salary.

Absolutely the market could fall. But I’d not be betting on it. Would you?

And that’s what holding off is, it’s betting it falls. And substantially. And if it doesn’t, she’s priced out and has no chance.

So you can borrow £90,000 on your salary.

Then you add your deposit on top- so if you’ve saved £30,000, you can afford a property of £120,000.

The mortgage amount is based solely on your salary.

The bigger the deposit the more you have to add to the total.

But if you can afford a 1-2 bed flat, and you’re single, really you’re in a great position. Get house hunting!

Eh?

Dh and I could only afford a 2bed ground floor flat when we first bought. So that's what we bought. Over the ten years we lived there (by choice), we had two kids and managed to clear enough of the mortgage to give us a heck of a deposit for the next home.

@anon282428

I think my problem could be my earnings. I've thought of options such as trying to save a bigger deposit, but putting the bigger deposits and my current wage into the calculators online etc, I'm still getting the same result of 90k.

So whether I put in a 10k deposit, a 15k deposit, a 20k deposit, they always linger around the 90k avaliable to borrow mark.

Yes, this is how it works. Bigger deposit just means you can get lower interest rates generally.

What's wrong with a 2 bed flat as the first rung on the property ladder?!

There's plenty of people who don't have that opportunity and are struggling to save up a deposit.

Stay for a couple of years, maybe add some value and hopefully you can move up to something bigger and better. That's what most up us have had to do.

I bought my first 2 bed flat at 30 and I love it. Yes my friends generally all have houses worth triple of what I have...because they are married and got on the rung earlier than me. I'm single and have a good job out earning lots of those with 4 bed houses but 1 person vs a married couple both working full time just doesn't compare. Get on that ladder and feel proud you've saved for that all by yourself :)

@anon282428

I think my problem could be my earnings. I've thought of options such as trying to save a bigger deposit, but putting the bigger deposits and my current wage into the calculators online etc, I'm still getting the same result of 90k.

So whether I put in a 10k deposit, a 15k deposit, a 20k deposit, they always linger around the 90k avaliable to borrow mark.

Well yes, your deposit has little bearing on what lenders will lend. That is solely dependant on your income. The most they'll lend is 4.5 of your annual salary.

How much have you saved out of interest?

@hyperbole001 10k. I know it isn't alot.

The amount you can borrow is usually about 4 to 5 times your annual wage. If you want to borrow more then you need to earn more. Your age isn't a consideration until it comes up to how many years you want the repayment term to be.

2 bed flat sounds like a great place to start on the property ladder :)

@anon282428 first off well done you, good effort to get on the housing ladder at all! If I were you, I’d look to get a 2 bed flat so you have some options to have a flat mate should you want to try and overpay the mortgage and build equity up.

How much deposit do you have saved up?

@anon282428Just seen your update, 10k of savings is good, can you use that all for deposit or does that need to cover legal fees/survey etc too?

If it does, it’s well worth trying to get in the 90% LTV band as rates will be cheaper. Happy to help further just @me if you have specific qs.

@anon282428Bear in mind also, that your deposit (10k) is what you can borrow, not the value of the house you can buy. So if you can borrow 90k and you have a 10k deposit, you can look for flats/houses for sale at 100k.

@anon282428

I think my problem could be my earnings. I've thought of options such as trying to save a bigger deposit, but putting the bigger deposits and my current wage into the calculators online etc, I'm still getting the same result of 90k.

So whether I put in a 10k deposit, a 15k deposit, a 20k deposit, they always linger around the 90k avaliable to borrow mark.

In all honesty OP, if you haven’t yet grasped the fact that your mortgage offer will depend on how much the mortgage company thinks you can afford to pay them back out of your current earnings then I am not sure if you are quite ready for home ownership.

Don’t forget you will also have to pay for repairs and maintenance to the property as well as council tax, utilities, broadband etc. If it is a flat you might also have to pay for shared maintenance of communal areas plus possibly a fee to the leaseholder. If a mortgage company offered you an amount that you couldn’t afford to repay you would not have funds to coupler these additional expenses. Have you also factored in the costs involved in buying a property, the searches and legal fees etc?

Cover not coupler!

@anon282428

I think my problem could be my earnings. I've thought of options such as trying to save a bigger deposit, but putting the bigger deposits and my current wage into the calculators online etc, I'm still getting the same result of 90k.

So whether I put in a 10k deposit, a 15k deposit, a 20k deposit, they always linger around the 90k avaliable to borrow mark.

Have you spoken to an actual mortgage broker or only used the online calculators? Brokers have access to a much wider range of mortgages than just the big banks etc. You might be able to find a better deal. But, as others have said, you have to start somewhere. My first house was a repossessed terrace in need of lots of renovations / new roof etc. It took me time but I patched it up and made it a really nice place to live over time.

You’re lucky to