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Starting to Think Monetary Policy Isn't that Loose...

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Firstly let me say I've got no intentions of getting a mortgage no matter how small, however... over the weekend I was having a play with a few of the major banks online mortgage calculators and I was very surprised at just how little I was being offered, here's the figures-

 

Deposit -            £140k

House value -    £170k

Mortgage -         £30k (which I know I could comfortably pay off on a 10 year 3% fix)

Net income-       £12k

 

No dependants, No other debts, loans or credit cards

 

They were all coming back with a maximum amount I could borrow of £22k-£23k... less than 2x my income, even though I had an 80% deposit!

 

I'm starting to think banks aren't necessarily throwing money around like confetti (like I previously thought) and I'm wondering just how on earth people are paying the current insane prices?

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Seriously try santander, my friend went from application to offer in 7 days 5 x joint salary ! Its mostly automated and they have a application to offer time frame of 10 days. Talk to a broker

 

 

 

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On 12/5/2016 at 6:16 PM, nome said:

No other debts, loans or credit cards

That is your problem summarised in one sentence.  Your credit rating is probably quite low because of no history of loans and their repayment.  

I know it doesn't make sense but that's how things are.  Get some credit cards, even if you use them very little and pay off every bill immediately (without incurring any interest charges).  May also earn some cashback as a bonus.

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Like I said I've got no real intention of buying right now and even less inclination to take on even a small mortgage, unless my ideal ''forever'' home came along for an absolute bargain price, which is highly unlikely.

 

I was just playing with the calculators, I've just tried Santander and that came back at £29k so still only 2.5x my income.

 

I agree BearHug, IF I was seriously looking to take on a mortgage my complete lack of credit history would be a stumbling block... never having had a loan, a credit card, or even so much as a phone contract would count against me, whilst having 6 figure savings despite only earning half the national average wage counts for very little!

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On 28/01/2017 at 5:10 AM, nome said:

Like I said I've got no real intention of buying right now and even less inclination to take on even a small mortgage, unless my ideal ''forever'' home came along for an absolute bargain price, which is highly unlikely.

 

I was just playing with the calculators, I've just tried Santander and that came back at £29k so still only 2.5x my income.

 

I agree BearHug, IF I was seriously looking to take on a mortgage my complete lack of credit history would be a stumbling block... never having had a loan, a credit card, or even so much as a phone contract would count against me, whilst having 6 figure savings despite only earning half the national average wage counts for very little!

Just tried Santander with 12k income came back at 38,000 so 4x but that's because the low wage leaves less aside

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On Friday, January 27, 2017 at 9:52 AM, houseface2000 said:

Seriously try santander, my friend went from application to offer in 7 days 5 x joint salary ! Its mostly automated and they have a application to offer time frame of 10 days. Talk to a broker

Equally I know several people whose applications were rejected even though their income was comfortably within the lenders acceptance criteria and no blemishes on their credit records.  A situation I'm currently aware of is where a house has been substantially extended and modernised and the lenders we've approached insist on regarding the building costs that we want to incorporate into a mortgage as evidence that the mortgagor is a spendaholic. 

In this specific case the borrowers income is comfortably within the lenders criteria and the LTV is under 75%. 

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