The Lemon Fool

Hi All

I am back for a bit of advice please

As you may know from previous threads OH was made redundant a couple of months ago, he is due his final payment in about 5 days time.
Our house at the time was a tied cottage which we are still living in but the rent will be going up soon to a market rate set by the company that has taken over from OH. We have been looking for alternative rented accommodation and have not really seen anything. I have now come across a house offered on shared ownership which we really like. We have been accept by the housing side but obviously would now need a mortgage for the part we would need to buy. My question is do we stand a chance?
We would be buying a 40% share for £118,000 and then paying £280 rent for the rest. We are both just over 50. We have now paid off all but £400 of any debts. We have a little savings plus the redundancy, we are not quite sure how much as there should be some extra to the statutory. OH is now on £39,500.00 per annum and I am on £23,300.00 Per annum.
If there is any chance and does anyone know which provider would be the best to approach?

Thank you so much
Lizzy

What does your credit file look like - it would be worth getting an up to date copy and ensuring any out of date information is corrected before you apply.

In your circumstances I would suggest using a broker - they will know the best provider to try and can sound some out without searches showing up. And, I would suggest using a fairly small, local broker, not a national one (who, quite frankly, don't give a stuff). Someone you can sit with and explain the situation. Ask around for recommendations.

I think you will get it - is OH out of his probation period (if there was one) and are both jobs, as far as you know, permanent and in the same or a similar field to the last roles?

Have you done a budget? Do that. Do it on 6% interest for the mortgage (not as 'worst case' [it can get worse!] but just as 'possible if we have a poor credit score' - if this happens you can always remortgage in a couple of years). I reckon the most they'll let you mortgage over is 15 years, so the repayments might be quite high but you have a decent joint income so probably be able to do it.

You would probably need a 10% deposit. Are you likely to have that?

Mel

Why do you ask if you stand a chance?

Why wouldn't you stand a chance?

Hi Mel

Thank you for the advice.

I have not checked our credit yet but last time I looked it was fine.

OH had three months probation but they are more than happy with him so that is okay, it is a different role from his previous job but related.
My job has not changed I have just had a payrise. Both jobs a permanent

I have spoken to a broker today and we have a meeting tomorrow. After taking down details over the phone he estimated that we would get a mortgage for 17 years and need a 10% deposit. He advised me to get an offer in on the property straight away as he said they are not often available in this area.

I put an offer in to the estate agent who came back to me to say the housing association had advised them that we would need a £23,000 deposit. I asked if this was in addition to the 10% for the mortgage company. I have been advised that because there have been improvements made to the property these will not be included for a mortgage valuation on shared ownership only the value of the property prior to improvements there for we would need to find the difference.

The property is for sale at £118,000 for a 40% share but they say we wold only get a mortgage on app £100,000 so we would need to find £18,000 plus our 10% deposit. The mortgage broker said he had never heard such a thing and would loo into it so we wait to hear. I think I can raise around £16,000 to £19,000 depending on the final redundancy payment but £23,000 may well be too much.

I have a budget but it is for living here so I am going to go through the SOA to work out affordability but The broker estimated mortgage payment to be £600.00 a month plus £270.00 rent and a £5.60 service charge so if we can proceed it would cost less than the rent for our current home and the bills would be lower as it is a semi and half the size.

I will let you know what the mortgage broker advises tomorrow.
Many thanks
Lizzy

Hi GrandOiseau
The reason I asked if we would stand a chance is in part due to our age and secondly as we have just finished paying of the last of our credit card debt
Many thanks
Lizzy

Well age is a limiting factor of course but being debt free isn't.

Hi Mel

I have checked my credit score on Noodle and it is 4 out of 5 OH's is 5 out of 5

Please can you let me know the implications of this

Many thanks
Lizzy

This is a copy of my SOA if we were successful in buying the little house we are looking at
Many thanks
Lizzy

Household Information
Number of adults in household........... 2
Number of children in household......... 1
Number of cars owned.................... 2

Monthly Income Details
Monthly income after tax................ 2916.7
Partners monthly income after tax....... 1536.98
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 4453.68

Monthly Expense Details
Mortgage................................ 660
Secured/HP loan repayments.............. 0
Rent.................................... 270
Management charge (leasehold property).. 5.6
Council tax............................. 107
Electricity............................. 54
Gas..................................... 60
Oil..................................... 0
Water rates............................. 44
Telephone (land line)................... 20
Mobile phone............................ 77
TV Licence.............................. 0
Satellite/Cable TV...................... 0
Internet Services....................... 35.5
Groceries etc. ......................... 600
Clothing................................ 40
Petrol/diesel........................... 60
Road tax................................ 25
Car Insurance........................... 35
Car maintenance (including MOT)......... 45
Car parking............................. 0
Other travel............................ 20
Childcare/nursery....................... 0
Other child related expenses............ 50
Medical (prescriptions, dentist etc).... 5
Pet insurance/vet bills................. 43
Buildings insurance..................... 0
Contents insurance...................... 17
Life assurance ......................... 0
Other insurance......................... 0
Presents (birthday, christmas etc)...... 50
Haircuts................................ 10
Entertainment........................... 20
Holiday................................. 25
Emergency fund.......................... 20
National trust membership............... 10
Audiable................................ 8
Auto desk............................... 2.5
Magazine................................ 7.5
lottery................................. 20
Pet food................................ 60
Total monthly expenses.................. 2506.1


Assets
Cash.................................... 0
House value (Gross)..................... 0
Shares and bonds........................ 0
Car(s).................................. 15000
Other assets............................ 500<b>
Total Assets............................ 15500


Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 100000...(660)......2.9
Total secured & HP debts...... 100000....-.........-

Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-


Monthly Budget Summary
Total monthly income.................... 4,453.68
Expenses (including HP & secured debts). 2,506.1
Available for debt repayments........... 1,947.58
Monthly UNsecured debt repayments....... 0<b>
Amount left after debt repayments....... 1,947.58

Personal Balance Sheet Summary
Total assets (things you own)........... 15,500
Total HP & Secured debt................. -100,000
Total Unsecured debt.................... -0
Net Assets.............................. -84,500

Created using the SOA calculator at http://www.stoozing.com.