Advice on financial situation

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* thread moved from Mortgage Forum


Hi all,
First time posting here but have found it very informative in the past so i hope you can offer some advice here!

Heres my situation,I earn 40,000 salary (recently reduced from 45,000)+annual bonus of circa 2500,my girlfriend earns 32,000 basic+comission.
I work as an Engineer in the Construction industry and although times are tough in that Industry,I am pretty confident of my job security as I have a decent position with a large stable company that have some high profile contracts.
My GF works in Sales and again is reasonably secure.
We are renting at 950per month.

I have an existing personal loan of 7K and I currently pay 600per/month repayment.My Gf has 1800 remaining on her loan.

My main query is should I be concentrating on paying extra into the loan (can afford prob another 300per month)and getting it paid off sooner or when it comes to getting mortgage approval to have some savings record? Obviously we need min 8% deposit also and we would be able to source that as a loan from our family.
As i understand it its not possible to get a mortgage approval if we have any existing loans?

Ideally we would target applying for a mortgage in 12months time.

Anyway i know thats a bit long winded but I would appreciate any advice!

 

[UFC]

With the way the economy and houses prices are going, I think 12 months should be the earliest you consider buying a home.

If I were you I would pay the extra into the loan so you are debt free in 8 months, and then put the 900 a month into a savings account for the remaining 4+ months before you apply for a mortgage.

But if I were you I would not consider getting a mortgage for 3+ years. You may need to emigrate before then.

 

[Ctrl+Alt+Del]

Cheers for your thoughts UFC.Yes admittedly i would be wary of plunging into a mortgage if i wasnt confident of having long term work.
Potentiallly ill be working on a long term project (3 yr duration) starting mid next yr.If that happens then i would feel secure enough for the commitment.
Thhe house prices scene is a seperate issue which ill be keeping a close eye on.

regards your comments on the loan etc-ya it makes sense i guess,but from what im hearing its not easy to get mortgage approval regardless these days.

 

[queenlex]

With the way the economy and houses prices are going, I think 12 months should be the earliest you consider buying a home.

If I were you I would pay the extra into the loan so you are debt free in 8 months, and then put the 900 a month into a savings account for the remaining 4+ months before you apply for a mortgage.

But if I were you I would not consider getting a mortgage for 3+ years. You may need to emigrate before then.

+1 very good advice I reckon.

 

[so-crates]

regards your comments on the loan etc-ya it makes sense i guess,but from what im hearing its not easy to get mortgage approval regardless these days.

Not easy but not impossible either. Whether you decide to buy a property this year or not, paying off your outstanding loans as quickly as possible will put you in a better position.

 

[reynolds]

With the way the economy and houses prices are going, I think 12 months should be the earliest you consider buying a home.

If I were you I would pay the extra into the loan so you are debt free in 8 months, and then put the 900 a month into a savings account for the remaining 4+ months before you apply for a mortgage.

But if I were you I would not consider getting a mortgage for 3+ years. You may need to emigrate before then.

+2 Top suggestion

 

[Chris]

With the way the economy and houses prices are going, I think 12 months should be the earliest you consider buying a home.

If I were you I would pay the extra into the loan so you are debt free in 8 months, and then put the 900 a month into a savings account for the remaining 4+ months before you apply for a mortgage.

But if I were you I would not consider getting a mortgage for 3+ years. You may need to emigrate before then.

Agree on this. Pay off the loan, then put as much as you can into a savings account on a monthly basis until you have the 8% deposit plus solicitor fees, and ideally some money for furniture. This will look very good for your mortgage application when you can provide a statement of your monthly savings.
Even if you borrow the 8% from a family member you are still looking at owing 100% of the propoerty value, which is not something you should consider. Bottom line is that there is no rush to get on the propoerty ladder, at the moment the only direction prices are going is down.

 

[stargirl01]

Having recently been a FTB, pay off all loans and debts and don't borrow for the 8%. You are going to struggle with cash especially if you purchase an older property and need to redecorate, rewire, replace boilers etc.
Use the family loan after you have the mortgage, and know exactly what you're paying on the mortgage and how much you can repay them. You are going to have more outgoings then you bargain for, even when you have a contingency fund in place. It's handy to have the family then.