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Interesting 'case study' on the site

Many first time buyers in the greater London area could be forgiven for thinking that the housing ladder will always be out of reach. The average price of a property costs in excess of 250K.

The average London wage 32K. Seven times salary is not a multiple that most lenders would accept. What options are therefore available for our advertising executive Jon? Earning a basic of 28K he can double it if he hits his targets.

Unfortunately some lenders do not factor into the equation commission payments, there are, however, a lot that do, although the rate could be slightly loaded when taking it into consideration.

With a 20K deposit Jon could obtain a mortgage of 196K, adding on his savings results in him being in a position of affording a property in the region of 216K.

With so much more bearish news beginning to be published Jon is concerned that his hard earned deposit may be friterred away with a further house price fall.

Jon wants to explore the opportunity for using as little of his deposit as possible, perhaps 7K.

Like most FTBs he wants to buy if he can drive a hard bargain with vendors in his chosen areas, and if his mortgage payments are kept in line with his current rent of £900 pcm.

Jon shares his current flat with a friend, he does not want to enter into a joint mortgage with his friend, but wants to know if his friends contribution towards the mortgage payment can be included in any calculations. His friend is willing to contribute £350 pcm for one bedroom of the two bedrom flat required.

Jon`s predicament is not unusual. Jon is capable of earning 56K p.a. and yet the quality of property available for him to consider in London is poor at a figure circa 200K.

Jon bends over and takes it from behind? any comments on this 'case study'

Edited by moosetea

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Earning a basic of 28K he can double it if he hits his targets.

Unfortunately some lenders do not factor into the equation commission payments

I wonder why that might be? Could it be common sense at work?

:unsure:

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  • 301 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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