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Current Lending Levels

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Went to one of the nationalised banks yesterday asking about mortgages.

Said our income was split 90% / 10% between me and the wife. They said they could offer 4.4x joint income whilst we had 1 dependent dropping to 4x income when we have 2 dependents. Don't think it mattered but would have been 75%ish LTV.

Still not exactly what I would call 'tight' lending limits.

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Went to one of the nationalised banks yesterday asking about mortgages.

Said our income was split 90% / 10% between me and the wife. They said they could offer 4.4x joint income whilst we had 1 dependent dropping to 4x income when we have 2 dependents. Don't think it mattered but would have been 75%ish LTV.

Still not exactly what I would call 'tight' lending limits.

Just curious but what age are you?

Sorry, just to elaborate, I was wondering at what point the applicant's age becomes an issue?

Edited by Bootsox

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Early 30s.

Extending the term from 25years was mentioned with 'advice' that any term be finished before retirememt, I. E. 65

Soon to be 67.

Then to infinity and beyond...

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Actually this raises a good point about pressure on buyers.

Buy, buy, buy before to get too old and you can't increase affordability by extending the term

And.,

Buy, buy, buy before you have kids and we'll slash the amount you can borrow.

Basically, buy now or you'll miss the boat.

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Personally I don't think 4x salary is too high - I do consider it the maximum of what should be allowed though.

I agree.

I would need to borrow 4x salary at current prices. That's not going to happen at the moment. I can wait.

EDIT: oops, I misread, I think 4x is too high

Edited by anotherpointlessnamechange

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Personally I don't think 4x salary is too high - I do consider it the maximum of what should be allowed though.

This was 4x times joint income. If one of them loses the job, it will on average turn into 8x pretax income. This would consume the entire income if the interest rate was 7.5% or so. Of course, most people would default before the repayments accounted for even half the income.

If you wanted a truly conservative criteria, it would be something like repayments not exceeding 40% of take-home at 5% over 1-year Greek government paper. Sadly, that would require a much bigger income than the house would cost :-)

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This was 4x times joint income. If one of them loses the job, it will on average turn into 8x pretax income. This would consume the entire income if the interest rate was 7.5% or so. Of course, most people would default before the repayments accounted for even half the income.

If you wanted a truly conservative criteria, it would be something like repayments not exceeding 40% of take-home at 5% over 1-year Greek government paper. Sadly, that would require a much bigger income than the house would cost :-)

Strictly speaking I would need 4x my income at the moment, not joint but if you read the OP, I am practically a single earner family.

Current rent and deposit interest income mean that the repayment mortgage at 2.79% would cost £350 more than renting, never mind a normal interest rate for a mortgage or costs associated with owning. In this particular case, the bank wanted a £999 fee + £400 valuation fee!

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  • 335 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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