We are wanting to apply for a mortgage of around £125000 as soon as possible. Having worked several years as an agency nurse, last week I started a new job and I have been advised no lender will accept us until I have worked my 12 week probation period. In the meantime i want to get everything looking as good as possible bank statement wise but not sure how to go about it to look the best to the underwriters.
We have proceeds of sale from our previous house of £60,000 and a gifted deposit of £30,000. I have debts several credit cards amounting to £16,000 and 2 loans one for £320 and one for £340/month. I also have a default registered Sept 2020 for £15000 credit card but the lender is being very reasonable and is alowing us to pay back at whatever rate we can afford and has promised they will not sell the debt on etc. I had some missed payements and arreas over the past year but all accounts are now up to date.
My contract is 40 hrs which equates to around £2560/month take home, there is always overtime avaiable and in the unlikely event I need more work I will also stay registered with agency so my full earnings will be in the region of £3000/month.
I am planning on paying off the £320/month loan which has a balance of £6000 and then the total debts will be about £760/month. I was wondering what level of avaiable funds are lenders looking for on a monthly basis? is it best to pay off more debts now and reduce our deposit of keep a high deposit and continue paying off debts slowly? If we get a 5 year fixed rate do lenders still stress test the mortagage and if so how much extra free fiunds are they looking for?
Just need to increase our chances of getting a mortgage
Hi Kate, thanks for getting in contact.
You've asked quite a specific question here which is good however all lenders will treat affordability quite differently therefore the key would be to first establish which lenders are available to you based on credit profile and LTV.
With a credit file from a main agency we'd be able to get a better understanding of your situation and move on from there.
Thanks for your reply, I have my check my file which shows all of the main reference agency reports
We are looking at a properties in the region of £175-200,000, so our LTV should be maximum of 70% likely less than that,
With a LTV around 70% I would expect there to be options available to you however as with everything it would come down to the finer details.