I think the lending criteria is 4.5 times the salary
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Nowhere near then. Mind blown
And that's only with some banks, most are 4x. When we got our mortgage (2017) we earnt £65K between us, needed a 4.5x mortgage so only had the choice of Barclays or Metro and still needed £75K deposit. We could easily pay more on our mortgage but because of the affordability criteria now they wouldn't lend us any more. I really do feel for people who cannot get the deposit together but could easily afford the mortgage payments, it's a never ending cycle.
How on earth did you get a £75k deposit? I am sorry if it's a personal question, you don't have to answer
No that's ok, we were very fortunate and my parents gifted us £60K. We had £30k of our own saved, but we missed the stamp duty relief by 2 months so had stamp duty, fees and our house needed £20K worth of work. We still had to move 20 miles from where we lived, to be able to have afforded to buy without help we would have had to complete relocate and I work for the family business so that wasn't possible for us. To add some context, we live in Surrey.
We have been extremely lucky, I know that, we bough an ex council house that had all original 1960s features and had been empty for about a year, we have had to gut the whole thing, we did the work ourselves but we think we have added about £80-100K of value.
In 2018 pretty much every bank offered us 4.5k, several offered us 4.75. It isn't that rare to get a multiple of 5x for a single applicant.
We ended up doing 4.75x which was a relatively risky but the property was undervalued for the area and we did a renovation so we were fairly certain we would quickly drop down a few LTV brackets, which we did. We bought at 90LTV and when we remortgaged 1.5 years later to 75LTV.
I wouldn't feel comfortable at 95LTV, I have a friend who bought with a 10% deposit at and 2 years later had to pay a lump sum in order to stay on 90LTV as her property had lost value. This is so easy with only 5% in the property, particularly because interest rates at this level are much higher so it is very difficult to play catch up and gain more equity without substantial overpayments.
It isn't that rare to get a multiple of 5x for a single applicant.
We ended up doing 4.75x which was a relatively risky but the property was undervalued for the area and we did a renovation so we were fairly certain we would quickly drop down a few LTV brackets, which we did. We bought at 90LTV and when we remortgaged 1.5 years later to 75LTV.
I wouldn't feel comfortable at 95LTV, I have a friend who bought with a 10% deposit at and 2 years later had to pay a lump sum in order to stay on 90LTV as her property had lost value. This is so easy with only 5% in the property, particularly because interest rates at this level are much higher so it is very difficult to play catch up and gain more equity without substantial overpayments.
It isn't that rare to get a multiple of 5x for a single applicant.
I feel such empathy for anyone trying to get on the property ladder these days.
I was extremely lucky and we bought our first house in 1991 on a 95% mortgage.
I now live in our third house but if I had to start out again today, our salaries would not even be enough to get a mortgage on the very first house we bought, let alone the one we live in now!
l fear my children will never be able to afford a property without the help from us.
I hope the housing bubble bursts so that first time buyers have a chance of buying because house prices are ridiculous now.
I was extremely lucky and we bought our first house in 1991 on a 95% mortgage.
I now live in our third house but if I had to start out again today, our salaries would not even be enough to get a mortgage on the very first house we bought, let alone the one we live in now!
l fear my children will never be able to afford a property without the help from us.
I hope the housing bubble bursts so that first time buyers have a chance of buying because house prices are ridiculous now.
I really hope it does come into play. Although I heard it’s coming in 2023 which isn’t useful to people like me who really want to escape renting and nightmare neighbours. I’m single and my parents don’t have the money to support me for a large chunk of money so saving for a deposit of around £25k is a struggle- especially paying London rent. It’s a bit frustrating being able to afford the mortgage repayments quite easily but not having the deposit to get things in motion.