Buying a house?

[SlickShoes]

Hi, Looking for some advice about buying a house before i properly start looking and seeking out mortgages again.

I am looking to buy a house with my wife, I am not a first time buyer, but she will be, does this mean we are treated as first time buyers or not if one of us is and one isnt?

She has student loan debt, currently it has never been paid since she doesnt meet the pay threshold for paying it anyway, does this affect her credit rating or ability to get a mortgage?

Would the above mean i am better going for the mortgage on my own since i am not a first time buyer and have no debt and deposit?

Other that those two things we have just over 10% saved for a deposit and 0 debt other than her student loan, so before i went in to some places i was just wondering if anyone on here would know about these 2 points?

Thanks for any advice!

[Jack]

My experiences were pre-crash so the rules may have changed and each lender had slightly different rules anyway.

I think rule of thumb is (and using illustrative figures only) if both you and your Misses have a salary of £30k each then the income is £60k. This is then multiplied by 2 or 3 or whatever to give the gross lending figure, lets say £150k. From this figure would be deducted any debt like the student loan, one company I went to even deducted my outstanding credit card bill! So if all that debt added up to £10k you'd get a maximum mortgage of £140k.

Have a look round here http://www.moneysavingexpert.com/mortgages/ (http://www.moneysavingexpert.com/mortgages/) for some good deals and advice.

I would suggest not using a mortgage broker. I cant honestly see the point in them. All they seem to do is take your details, do a Google search, fix it up then charge you a grand! Once you have had a chat with a couple of lenders you'll have the hang of it.

[Hibs Class]

Lenders are supposed to assess affordability, which means not only looking at what debts you have but also how your income & expenditure stack up each month. With student debt repayment being based on earnings level, the fact there haven't been repayments to date doesn't mean she's in default so there shouldn't be any adverse rating.

[SlickShoes]

My experiences were pre-crash so the rules may have changed and each lender had slightly different rules anyway.

I think rule of thumb is (and using illustrative figures only) if both you and your Misses have a salary of £30k each then the income is £60k. This is then multiplied by 2 or 3 or whatever to give the gross lending figure, lets say £150k. From this figure would be deducted any debt like the student loan, one company I went to even deducted my outstanding credit card bill! So if all that debt added up to £10k you'd get a maximum mortgage of £140k.

Have a look round here http://www.moneysavingexpert.com/mortgages/ (http://www.moneysavingexpert.com/mortgages/) for some good deals and advice.

I would suggest not using a mortgage broker. I cant honestly see the point in them. All they seem to do is take your details, do a Google search, fix it up then charge you a grand! Once you have had a chat with a couple of lenders you'll have the hang of it.

Cheers ive been on that website a fair bit and done some googling too.

I even had a lending quote some months ago when i had debt. now im clean of that so hopefully can get a better mortgage.

the moneysavingexpert site seems to suggest that since there is no outgoing money to the student loan it shouldnt affect the mortgage, some googling found that some people that was the case and other lenders did take it into account.

I think it generally now seems to be 3.5 or 4 times income 1 or combined income. When i was getting a mortgage 5 years ago they were trying to get me to borrow 6 times my income which i thought was insane!

My main worry is with one of us being a first time buyer and one not i dunno how that works.

I will be shopping around for my own mortgage though dont intend on using a third party! Already had enough of solicitors and all that when i was selling my last place!

[Woody1985]

My understanding is that if you don't have a mortgage at the moment you are classed as either a first or second/next time buyer. Neither make a difference to the rate available to you.

If you have a mortgage at the moment on your own, and you're moving it companies it's classed as a remortgage because your company need to pay off the old company and give you any potential excess borrowing.

If you are adding her to an existing mortgage it is known as a Transfer of Equity.

If you are moving home and are staying with the same lender it is known as porting your loan.

I think you're perhaps getting bogged down due to terminology and the options available in the comparison site search engines, assuming that's what you've been doing.

If you have no mortgage and you and your partner are looking for a mortgage and the options are first or second/next time buyer. Go for second/next time. If the only options are first or remortgage then go for first.

Hope that makes sense!

[SlickShoes]

My understanding is that if you don't have a mortgage at the moment you are classed as either a first or second/next time buyer. Neither make a difference to the rate available to you.

If you have a mortgage at the moment on your own, and you're moving it companies it's classed as a remortgage because your company need to pay off the old company and give you any potential excess borrowing.

If you are adding her to an existing mortgage it is known as a Transfer of Equity.

If you are moving home and are staying with the same lender it is known as porting your loan.

I think you're perhaps getting bogged down due to terminology and the options available in the comparison site search engines, assuming that's what you've been doing.

If you have no mortgage and you and your partner are looking for a mortgage and the options are first or second/next time buyer. Go for second/next time. If the only options are first or remortgage then go for first.

Hope that makes sense!

Cheers mate it did clear it up a bit, i have sold my old place but didnt really get anything out of that other than my deposit back which i intend to now use on my new place with my wife.

From what you say I/we will be next time buyer category. I guess its depending on having had a previous mortgage paid it on time and paid it off will all be decent things for the process. The rates im being quoted online dont seem that much different anyway for first timers or moving home options, really all depends on the deposit!

Just reading all the stuff about first time buyers soon needing a 20% deposit just to get on the market is scary, i have no idea how anyone can save up around 20 grand whilst renting and living at the same time was bad enough getting 10% together!

[Woody1985]

I believe the remortgage (moving home) market were offering good rates before the crash to get people moving around.

A little bit of information for you if you're interested and something to consider when looking at rates, especially non-fixed rates.

An international body (can't recall the exact name) recommended that the UK raise their rates by the end of Q4 this year. That was around May/June.

Other analysts are predicting the earliest rate change to be April / May next year so keep that in mind when looking around.

For the last 3 months 1 of the 8 members of the BoE decision making team has voted for an increase. He is looking to increase rates gradually whereas the others are likely to look at larger, less frequent increases. When I say larger I mean 0.5% rather than 0.25%, until we get around the 2% mark (suggested by the end of next year)

Lenders will sometimes move their variables up in line with the BR. However, there is a potential that some lenders may skim some on top for a little extra profit. E.g. if you're on a variable rate/discount mortgage they may put the rate up by 0.28/0.3% on a 0.25% rise.

I have an interest in when these are likely to move due to my job so I read up on this stuff now and again. Even more so lately because when's there's a change it will have an impact on me.

Don't take this as fact and do a little reading up on it if you feel it's necessary. Some others on here may have a much greater knowledge on the economy and rates but I am anticipating a rate change in the next 6-8 months.

[SlickShoes]

I believe the remortgage (moving home) market were offering good rates before the crash to get people moving around.

A little bit of information for you if you're interested and something to consider when looking at rates, especially non-fixed rates.

An international body (can't recall the exact name) recommended that the UK raise their rates by the end of Q4 this year. That was around May/June.

Other analysts are predicting the earliest rate change to be April / May next year so keep that in mind when looking around.

For the last 3 months 1 of the 8 members of the BoE decision making team has voted for an increase. He is looking to increase rates gradually whereas the others are likely to look at larger, less frequent increases. When I say larger I mean 0.5% rather than 0.25%, until we get around the 2% mark (suggested by the end of next year)

Lenders will sometimes move their variables up in line with the BR. However, there is a potential that some lenders may skim some on top for a little extra profit. E.g. if you're on a variable rate/discount mortgage they may put the rate up by 0.28/0.3% on a 0.25% rise.

I have an interest in when these are likely to move due to my job so I read up on this stuff now and again. Even more so lately because when's there's a change it will have an impact on me.

Don't take this as fact and do a little reading up on it if you feel it's necessary. Some others on here may have a much greater knowledge on the economy and rates but I am anticipating a rate change in the next 6-8 months.

Cheers, i was wondering about that, i have mostly been looking at fixed rate mortgages as i would like to know what im paying each month for a fixed term rather than have it fluctuate.

I understand the monthly payments on variables look good just now but that wont last forever. I got luck with my last mortgage which was a tracker, the payements dropped massively when the base rate went down, and tracker payments look great just now too but the base rate of interest has been low for a long time now and if it rises drastically id be worried about payments going up to unreasonable levels.

Think although fixed rate is more expensive its a safer option.