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Can Single people with low wages afford a mortgage?

Discussion in 'General Discussion' started by bakes0310, 15 Jul 2013.

  1. bakes0310


    Joined: 22 Oct 2004

    Posts: 12,778

    As long title, if someones on minimum wage or near to that, would it be possible to get a mortgage. I don't think it would be possible with all your bills and food etc. You probably couldn't get any goodies like have a cheap broadband even (not important just an example) or go out and live your life.
    On minimum wage how much would the bank give you, would they even look at you. And how much of a deposit would be the minimum that you should save?
  2. cm1179


    Joined: 30 Sep 2009

    Posts: 3,627

    you'd need a big deposit

    i'd say 20%+

    banks wont soley look at how much you earn. they'll look at your history. do you have any loans, have you ran a tight account, do you have a benifactor if the **** hits the fan? (i wouldn't trust the insurance they'll offer if you lose your job, sick etc)

    a bank wont want a repossesion. you can get mortgage breaks for a short period should you ever need one.

    say you take home £1k. if you can get a big enough deposit to get your mortgage and council tax to £500 p/m, that would leave you £500 p/m to live on. could you do that? with sacrifices, i'm sure you could.
    Last edited: 15 Jul 2013
  3. Marky


    Joined: 16 Apr 2007

    Posts: 23,407

    Location: UK

    Depends on where you live I guess - There's no chance where I live, but the further North you go the cheaper houses get.
  4. Derek W


    Joined: 1 Oct 2008

    Posts: 11,704

    Location: Glebe Park

    Big deposit and living in a total crap hole that no one else would live in and yes its probably possible.
  5. Ciphon

    Wise Guy

    Joined: 9 Dec 2008

    Posts: 2,341

    Location: Hampshire

    Using your weekly hours and overtime, try and figure out what your annual wage is, then plug that into some online calculators and see what comes up.
  6. Firestar_3x


    Joined: 11 Mar 2005

    Posts: 30,512

    Location: Leafy Cheshire

    Yes, in the wrong part of the UK you can buy a house for 30-40k, with a deposit of 10% it would be more than possible.
  7. Freakbro


    Joined: 29 Jul 2010

    Posts: 18,914

    Location: Lincs

    On minimum wage? Depends where you are living in the country I guess, but going on 'average' house prices....no not a chance tbh, since min wage for a 37.5hr / week job is gross £12,187.50 (then less Tax and NI) a year.

    Banks have gone back to lending, what, 4 times salary? so if you are looking for a house in the £50k range, then needing a minimum £5k deposit with monthly payments of I would guess ~£300, then it's just about doable.
  8. bakes0310


    Joined: 22 Oct 2004

    Posts: 12,778

    Ouch 20%+ for deposit, I can see why its so hard.
    Don't think theres such thing as a house in the £50k range:p
  9. Insta


    Joined: 14 Sep 2010

    Posts: 131

    Location: Scotland

    Have a look at Shared Equity homes. They are aimed at first time buyers with low income.
  10. Trifid


    Joined: 18 Feb 2006

    Posts: 8,445

    4 - 5 times salary depending on the lender, your situation and the size of the deposit. You'll need a big deposit.
  11. Bouton Aide


    Joined: 9 Aug 2008

    Posts: 28,320

    Mortgage lenders usually give a mortgage out 4x salary. You still require a 5%/10%/15%/20% deposit. Anyone below 15K a year would struggle with a mortgage I would say.
  12. jamiehavok

    Wise Guy

    Joined: 31 Dec 2008

    Posts: 1,403

    you can do a part mortgage, like you buy 40% and the rest is still owned by a housing association, or you can get a joint mortgage with a partner, or yeah if you have some savings you can put down a massive deposit to reduce your monthly mortgage repayments.
  13. Syla5


    Joined: 13 Feb 2012

    Posts: 5,184

    Generally deposit has more of an impact on the lending decision then salary. If you have a 50% deposit most banks will rip your arm off to lend to you. Though this is quite unhelpful given that you have also asked what's the smallest deposit you would require.
  14. steve55


    Joined: 11 May 2011

    Posts: 106

    If you rent out any spare rooms then it would be easy.
  15. pitchfork


    Joined: 21 Jan 2007

    Posts: 8,715

    Yep, I know a guy who bought a 1 bed flat (circa £85k) and he's on a low paid job.

    In a major city? Not a chance, hell, people with good jobs can struggle to get mortgages in the city.
    Last edited: 15 Jul 2013
  16. TMP


    Joined: 25 Jan 2005

    Posts: 621

    Minimum wage? Higher rate tax payers here struggle to find a 'decent' starter home (2 bed), I believe the term is income rich, asset poor... First world problems right?
  17. Soundood


    Joined: 9 Jun 2009

    Posts: 3,069

    Location: OCUK Detention Centre

  18. Mr-White


    Joined: 12 Nov 2002

    Posts: 14,625

    Location: In my own little world

    ^ give up hope

  19. Defy Belief


    Joined: 29 Sep 2010

    Posts: 3,851

    I got a 75k mortgage on a £14,500 salary at the point of applying for it.

    £17,500 deposit.

    The house needs alot of work though, so if you want a habitable house straight away I'd say no, but it's my little project. :)
  20. PooBrain


    Joined: 17 Mar 2013

    Posts: 1,143

    Mortgages are for fools trying to spend more than they can.