Making decisions that are crucial to easing out of the struggles of life are of utmost importance. In this material world, the material realities often require a jolt of a push to come at terms with these requirements. When the requirements and demands surpass the confined framework of monthly earnings, the mortgages come into the picture to satiate the need.
The two contracting parties play a major role in this process. It is a matter of huge investment for the lender and the burden of repayment; arduous efforts of application are there on the borrower’s part. Although not only the application process is tedious, many other features like security, repayment, etc. are to be kept in mind while moving forward with the process.
We often come across customers who have their eyes set on some property and the very first question that comes to their mind is how much they should be earning to become eligible to avail the mortgage of £150,000!
In this blog, we have tried to answer the central question and outlined the eligibility and affordability criteria. We are covering the following issues here:-
• How much one needs to earn to avail £150k mortgage?
• Factors are taken into account by the lender while calculating the affordability
• Possible plans for monthly repayments of the £150k mortgage
• Minimum deposit for a £150k mortgage
• Effects of age and bad credit history
• Mortgage on the unique property, on a second home, secured loan
How much one needs to earn to get the mortgage of £150k?
This is the most common question asked ‘how much one needs to earn’ before applying for the mortgage of £150k. This at whole depends upon how you earn your income, the deposits, and your credit history. It varies from one lender to another. The lenders determine the loan amount basing it on the multiples of salary. Most of the times it is four times the annual salary, some offer five times, and there is a minority of lenders that can go about six times the annual salary. In order to avail the mortgage of £150k, the annual salary of £30,000 seems enough.
Factors are taken into account by lenders
The mortgage affordability is much more than the money earned monthly from a full-time job. We assure our clients that, if the salary amount doesn’t align with the eligibility requirements, it still remains possible to grab one.
If your add-on to your earnings with
1 – Benefits
2 – Freelancing
3 – Overtime
4 – Commission
5 – Incentives
6 – Dividends and other legal sources of income
Only a minority of lenders would accept these earnings and take them into account. Few may cap the percentage of incentives and commission one can declare. These supplementary earnings will require specialists to ensure the deal with the best outcome. Our advisers have the right expertise to suggest the right lender offering a £150k mortgage at favorable rates.
The minimum deposit
The minimum amount you require to deposit depends on the loan to value (LTV) ratio. A loan application with low deposit is regarded riskier which results in fewer lenders. Majority of the lenders accept deposits of 20%, some 10%, and very few would accept as little as 5%. For instance, if the value of the certain property is £100,000 and the deposited amount is £5000, then the LTV is 95%. This is also the maximum LTV most lenders accept for residential properties. The outgoings such as Credit card debt, personal loans, and other finances also have a significant impact on the mortgage provider’s lending decision.
Age and Bad credit history issues like low credit score, mortgage arrears, CCJ, Bankruptcy, Repossession at times also hamper your efforts to avail the mortgage loan of £150k. Old age people often find it difficult to avail mortgage loans as some lenders cap the age of prospective borrowers. Having a unique property, applying for another mortgage on a second home, and a secured loan is easily available if you have enough equity in your home.
What are the repayment plans on the mortgage of £150,000?
The repayment of mortgage loans depends on the plan taken, and the interest rate offered. It depends at the length of the term for which the loan is taken, the credit history of the borrower.
What rates to do you qualify for will depend on your profile and the level of deposits made. If the reader still remains unsure about the repayments of £150k, then please do contact us to clear up the confusion and we can offer the rates as per your requirements.
Effects of the mortgage term on repayment
The repayment of mortgage loans decided on your circumstances and ability to pay. As we can see that the repaying amount is varying when the mortgage term is altered. For example, if you plan to choose a 15-year plan instead of 20 years one, you can save £15k in the overall process. But this might lead to a higher monthly burden. People have staged dark gloomy stories about the mortgage industry and its practices. Most of them are concerned with the major question of eligibility, ‘how much I need to earn to get a mortgage of £150,000? Here, a clear picture behind this dense smoke screen is explained and help you in choosing a viable and appropriate plan for the right mortgage.