Mortgage

Laddey

FH is my second home
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May 24, 2005
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Long time no speak!


I've got a default on my credit history. £611 to O2, stupid mistakes when i was younger and all that bla bla.

Anyway, am i gonna get a mortgage? Dunno how it works or anything. P


Thanks
 

Ch3tan

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Speak to a mortgage advisor, they have toughened up the checks (again). You'll need a good credit history, a permanent job, very decent wages - you are likely to only get a mortgage for 3 times your income. Also a big deposit is needed, if you don't have at least 25% deposit, then you you will get very high interest rates.
 

Laddey

FH is my second home
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Two of us, both our incomes sum up to about 40k a year but increasing as we qualify and stuff.

Deposit shouldn't be a problem. Two people on a mortgage changes things?
 

Ch3tan

I aer teh win!!
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Yeah, two sets of checks. Talk to a few advisor's, you won't know until you do. What are the prices of the places you are looking at? The market is set to go down again, I'd wait it out till March next year if you can.
 

Laddey

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I can wait not a problem, havn't looked at nothing yet as curious to see how i'd go about getting one. Somebody told me to go to somewhere like Mortgage Point?
 

cHodAX

I am a FH squatter
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Clear the debt and see if you can pay to have your credit record cleared. As long as you don't have any county court judgements against you it should be ok, if not then it will be tricky as the banks are playing hardball with first time buyers at the moment.
 

gohan

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laddey you can still get up to 5x joint income (so 200k in your case) but to hitbest rates u need 70% ltv (loan to value) IE u need a 30% deposite and im talking the difference between 3.99% and 6.5% lol



also defaulting with O2 will causes issues if its still outstanding or if it went to CCJ ect if it was a case of O2 rang you a few times themselfs then it was sorted it wont really matter


best way to test your credit would be to apply for a credit card and if u get one use it everymonth to buy shopping or w/e then pay it off in full to avoid your interest charges and to boost your credit




also your best bet is to go straight to who ever you bank with/ well known mortgages barclays/halifax/abbey



if u go through a broker don't forget he'll bend you over the table aswell, do the legwork yourself and save a mint

dont forget on top of mortgage deposite you have valuation fee's and soliciter fee's aswell, if ur buying say a 150k 2 bed flat, youl need about 50k upfront(45k deposite 5k fee's and other little spendings) and this is before you even furnish it, so think really hard if your ready, is your job 100% secure ect

i nearly completed on a 2 bed flat this time last year but all fell through at the last sec and i still got stung for like 1k in fee's, tho tbh it was a bit of a blessing because now im free to mvoe to southampto with some mates which i wouldnt have been before



that all said if you can afford it it's the best tiem its been in ages to buy a house, very unlikely you'll lose money on it
 

Ch3tan

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laddey you can still get up to 5x joint income (so 200k in your case) but to hitbest rates u need 70% ltv (loan to value) IE u need a 30% deposite and im talking the difference between 3.99% and 6.5% lol

It's really hard to actually get anyone to lend you up to 5x joint income though, in reality he may get between 3 and 4.5x.

The mortgages I have looked at recently, there was no difference in interest rates between a 25% deposit and a 30% one, does your bank actually give better rates at 30% than 25%?
 

cHodAX

I am a FH squatter
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He lives in Preston, lots and lots of places up there for under £100,000.
 

gohan

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It's really hard to actually get anyone to lend you up to 5x joint income though, in reality he may get between 3 and 4.5x.

The mortgages I have looked at recently, there was no difference in interest rates between a 25% deposit and a 30% one, does your bank actually give better rates at 30% than 25%?

as im currently doing mortgage advisor training at work i can say with certainty that woolwich (barclays) still offer 5x joint income and headline rates are for 70% ltv and below only if its 71% the rate hikes right up cos they jsut don't want that buisness atm (mainly due to the ammount of people currently defaulting in negative equity)


obviously haven't looked in massive detail into other peoples caps for rates but genraly speaking their all the same
 

Zenith.UK

Part of the furniture
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get on a list for council houses man
Also approach the local housing associations as well as the Council to see if there are any Shared Ownership or Shared Equity programmes running.
I'm in a Shared Ownership house with a 50% share.
House = £130,000
My share = £65,000
Deposit = £25,000
Mortgage = £40,000

You pay your (reduced amount) mortgage as well as a nominal rent to the housing association. They take care of the building insurance, but everything about the house is if you own it outright including maintenance.

It's one way of getting on the ladder, and you can staircase your ownership to 75% or even 100% at a later date (assuming you can afford it).
 

soze

I am a FH squatter
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Renting often costs the same as a Mortgage does but you are left with nothing at the end.
 

Ch3tan

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Renting often costs the same as a Mortgage does but you are left with nothing at the end.


Hate to do this but.... toht is right. Renting can cost the same as a mortgage, but in most cases it costs less. You have no real risk when renting, you simply need to pay your rent and your contents insurance + bills. In this climate getting a mortgage is not the best practise, there is no real job security and banks are not lending at great rates. If Laddey rented they could concentrate on saving up a bigger deposit for when times are better, and still live in their own place.
 

soze

I am a FH squatter
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Hate to do this but.... toht is right. Renting can cost the same as a mortgage, but in most cases it costs less. You have no real risk when renting, you simply need to pay your rent and your contents insurance + bills. In this climate getting a mortgage is not the best practise, there is no real job security and banks are not lending at great rates. If Laddey rented they could concentrate on saving up a bigger deposit for when times are better, and still live in their own place.

You are probably right but im stuck seeing renting as paying someone else's Mortgage i just could not force myself to do it.
 

Lethul

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banks are not lending at great rates

What? In sweden we prolly have the best rates since sliced bread atm. And i would expect it to be much the same worldwide since most general banks have almost 0% rate ?
 

Ch3tan

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What? In sweden we prolly have the best rates since sliced bread atm. And i would expect it to be much the same worldwide since most general banks have almost 0% rate ?


they are not passing on the savings in the UK. To be honest it's a good idea, the last thing we need is lots of people buying at low rates, and then being screwed when the rates go up in a year or two.
 

Marc

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Renting often costs the same as a Mortgage does but you are left with nothing at the end.

10 years ago maybe

You can rent a house thats worth £150k for £400-£500 per calender month where I am.

Good luck getting a mortgage for £150k for £400-£500 a month
 

Lethul

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they are not passing on the savings in the UK. To be honest it's a good idea, the last thing we need is lots of people buying at low rates, and then being screwed when the rates go up in a year or two.

Can't you have it at a fixed rate in UK?
 

Ch3tan

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Can't you have it at a fixed rate in UK?

Yes for a set period of time, usually two years. But you are still looking at 5% to 9% rates, and you are only getting better than that with a fat deposit (as gohan mentioned). My point is that we are in this mess because of irresponsible lending in the first place, what we need is for people to realise they really cannot afford what they think they can.

We are already back to a culture of short term borrowing in the UK, as the government tries to improve spending for Christmas and tries hard to convince us we are in recovery.
 

Lethul

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Yes for a set period of time, usually two years. But you are still looking at 5% to 9% rates, and you are only getting better than that with a fat deposit (as gohan mentioned). My point is that we are in this mess because of irresponsible lending in the first place, what we need is for people to realise they really cannot afford what they think they can.

We are already back to a culture of short term borrowing in the UK, as the government tries to improve spending for Christmas and tries hard to convince us we are in recovery.

Ic, in Sweden the fixed rate is at something like 3% at 3 years and 4% at 5 years or so, I think :)
 

kiliarien

Part of the furniture
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I would say as well as talking to your mortgage advisor, get yourself a copy of your credit report to see what's going on:

Credit Reports - Free Credit Checks - Experian UK

You can get a £2 report which will illustrate anything that flags up as immediately bad (ie. if O2 went to a CCJ, which it really doesn't sound like they did).

I would avoid getting a credit card and using it to increase your score, which it will, but if you do that your score is temporarily lowered whether your card application was successful or not for a minimum of 6 months.

Hope this helps.
 

Marc

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I would avoid getting a credit card and using it to increase your score, which it will, but if you do that your score is temporarily lowered whether your card application was successful or not for a minimum of 6 months.

Hope this helps.

It is? I was under the impression that aplications for credit increased your credit score, as long as you dont have too many in a short period of time
 

Calaen

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Long time no speak!


I've got a default on my credit history. £611 to O2, stupid mistakes when i was younger and all that bla bla.

Anyway, am i gonna get a mortgage? Dunno how it works or anything. P


Thanks

First off get yourself onto experian for a self credit service, you can see what you have fecked up on there, it also lets you add a description to the default to give you a chance to explain yourself (don't put you were young and stupid).

Other than that everything ch3t said, you gotta have a huge deposit, so unless your planning on buying a hole I wold imagine typical house/flat prices are around 90-100k so about a 20-25 grand deposit in order to get the lower interest rates.

They need to see exactly what you are spending your cash on, so while you waiting around don't go taking all of your cash out of the bank on the day you get paid. They will see last 6 months of bank statements and you haveing no cash after three days aint gonna go in your favour.
 

Calaen

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Renting often costs the same as a Mortgage does but you are left with nothing at the end.

Germans don't buy :p it's rent heaven across there, England got too caught up in it all, I have watched people I know with a part time job in sainsburys buy their own houses on that daft right to buy scheme, they are now renting again after losing the house. The majority of the council houses in the estate I grew up in have been bought by their tenants, just because they could. Not because they could afford it!
 

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