To get a mortgage or not

[Marie324]

Hello
Looking for some impartial advice what on what to. We are currently renting and family of 5. Our outgoings are very high as we live in SE. Rent is £1900 pcm, food bill is £1000 per month and that's if we are strict, bills come to £1000 per month. We have one disabled child due to this claim £1500 in universal credit per month. My part time salary is 28k and my DH is 49k. We also get DLA of £550 and child benefit of £240 per month. This seems like a huge amount of money coming in but we honestly struggle every month and are in a lot of debt. We have a deposit for a mortgage which has kindly been gifted to us but means we will lose our universal credit allowance making us £1500 worse off a month. My post is basically to ask for advice on whether to take a massive financial risk in order to get a mortgage. The minimum we could get our repayments to is £1600 per month. My employer currently is unable to increase my hours. Any advice welcome. Thank you!

Yes and this worries me

Ah right yes my bad, apologies!!!

Ok so assume you are on all lists for council and housing associations? Having a disabled child gives extra points. A lifelong tenancy would be my preferred option in your circumstances.

Your food bill, honestly it sounds about right for a family of 5, im 100 a week just for 2 adults. The food prices just now are just ridiculous.

How much debt are you in and is the giftee ok you use some money to clear debt?

We have been rejected once for council housing due to earning too much and our current accommodation being deemed suitable for disabled DC. The debt is about 8k and yes it has been agreed that some of the money will go on clearing that.

A forever roof over your head is worth its weight in gold !

I get you would lose the uc towards rent if have a mortgage but with it in the end and not paying rent till you die

if your employer can’t give more hours can you find an evening /weekend job to earn extra - bar staff - stacking shelves - cleaning - care homes etc

im south east and rent is stupid money

before you look at buying, I think you really need to look at your income and outgoings. With your salaries and benefits you’re on over £100k a year which is huge even for the south. If you’re struggling on that and in debt then you need to work out why. £1k a month on food is a huge food bill even for 5 people for example.

You do need to budget for this now and work out how much it will all cost. It might well wipe out a fair chunk of the difference between rent and mortgage costs. Also make sure you get a good higher level survey for any house you buy.

I've just spent nearly £900 on getting some urgent work done (had no hot water for a week and some dangerous electrics). In the last 4 years I've had to replace the oven, dishwasher and washing machine as they were all very old and just stopped working. I'm putting off replacing the fridge but it's nearly 20 years old and defintely on last legs.. If you buy somewhere with new applicances great but even then can pack up, usually when just out of warranty!

However the security of owning isn't to be sneezed at given the insecurity of the rental market and risk if an owner selling up. Moving with kids is not easy and rental supply will continue to dry up as smaller landlords sell up and so rent prices especially in the south east are unlikely to come down.

Yeah I'm looking into how to get more income. I have the possibility of doing extra shifts in addition to my contracted hours but by contracted hours cannot be increased currently. I have 2 chronic health conditions which complicate things even further as I'm concerned working extra hours may worsen these conditions. DH wage will increase over the next 5 years

Your joint take-home income is probably about £5k a month? It’s laughable for you to think you can’t afford a £1,600 mortagge, after adding £1k for food and £1k for bills you still have £1.5k free spending money.

You clearly don’t know how lucky you are.

Yes I know it's shocking when our income coming in is that much on paper. We've done countless spreadsheets. I wonder if the issue is the debt thats coming out each month. The kids clubs cost a lot and we pay some towards respite costs too.

I'm sorry you feel that way. I posted here for advice as I've previously stated we do struggle and we have high outgoings. For example our car is £400 per month.

Yeah this is part of our reluctance to go ahead with the mortgage. Feels like such a risk.

Are you eligible for mobility car for the disabled child?

Bearing in mind that roof room really shouldn't be used as a bedroom as it will be a fire risk if it hasn't passed building regs, one or all of, not good enough access, no fire door, no escape route.

You need to prioritise clearing debt - you light struggle to get a mortgage anyway jf you have unsecured debt. I’d really look at savings elsewhere like your food bill which is so high. You’d easily reduce that by a third.

I’d recommend you clear your debt…keeping savings/deposit while you’re in debt is futile.

Off topic but your food bill is insane. We spend 130 a week on food for a family of 5. At most 600pm. If you could save 400 a month just on food you’d have 5k by the end of the year.

You could approach CAP ( Christians against poverty, you don't need to be a Christian for their help). They would help you manage your debt and budget better. £1000 is crazy on food, even with a disability. Some meal planning etc would also help although I appreciate that probably feels overwhelming.

Where do you shop if you don't mind me asking? I'd love to get our food bill down to that!

I don't think we are unfortunately as DC gets lower rate mobility

Yes the debt is the real issue i think. A lot of it will be paid off by the time we buy (if we do) but I think we need to prioritise this as you say.

Sainsbury’s. I do a meal plan for the week and go with a list. I try not to do top up shops as one thing can easily end up being 10.

£400 per month on a car is huge. Do you really, really need it? Could you change your life to live without one? If you go without for a year and put what would have been car parents into savings you’ll have enough saved to buy a decent second hand one for cash. Or else extend your debt a little to buy a second hand one now for £2k.

We also shop there. I don't know what I'm doing wrong really. We buy a lot of fresh produce.. I find certain meat to be very expensive recently.

What typical meals are you eating during the week and what extras/snacks do you buy?

We are a family of 4 (plus pet) and we spend roughly £120 a week and I think we eat well. we tend to do a couple of very cheap meals per week as standard.

I know. We have another 2 years as we are leasing it through salary sacrifice. I appreciate it's a huge amount. I repeatedly raise this with DH but he says other deals available are pretty similar for the size car that we need.