Posted on 1 March 2016 by Mr C
I have recently divorced so I am asset poor but have a good salary with no ongoing financial commitment to my ex-wife. Is it still possible for me to obtain a mortgage on reasonable terms, for example on the length, or would I need to get a loan for a much shorter period 10-15 years.
Thank you for your enquiry via our ‘Ask the Experts’ section of our website. Although not knowing your full financial position, it would appear, based on the information you have supplied that this something we can help you to explore. From the details you have supplied this looks like you could get a mortgage. You have an excellent salary of £180,000, and you are looking to buy a property valued around £500,000k, with no ongoing commitments to your ex-wife.
Obviously we would need to know the all the details around your financial situation, given the new purchase is as at 90% loan to value (LTV) and you have a £50,000k deposit. As with any purchase it's important to remember that you will also need to cover other costs such as stamp duty, arrangement fees and solicitor costs.
The majority of lenders allow a maximum age of between 75 and 80 years at the end of the mortgage term and some will consider higher. Lenders also have a maximum mortgage term of between 25 and 40 years. Future retirement income will need to be verified if you take a mortgage term which extends beyond a notional state pension age of 75 years old which most lenders use as a cut off point, or your anticipated retirement age, whichever is the earliest. Affordability will be assessed on the future retirement income.
The actual term of the new loan may be restricted by the age at wish you intend to retire, or your ability to continue servicing the loan into retirement if you should wish to do so. All lenders assess income and expenditure differently, so having the correct figures is imperative.
To enable me to provide you with a definitive answer we would need your full financial details. Details of income, affordability and financial commitments will need to be discussed initially so we can find the right deal suited to your needs and the options available. Given all lenders use differing calculations to establish the amount of mortgage that are prepared to consider I recommend that you contact an adviser at John Charcol who will be able to recommend the most suitable lender based upon your individual circumstances.
Answers provided in response to Ask the experts are based on the information provided and do not constitute advice under the Financial Services & Markets Act. They reflect the personal views of the authors and do not necessarily represent the views, positions, strategies or opinions of John Charcol. All comments are made in good faith, and John Charcol will not accept liability for them.
We recommend you seek professional advice with regard to any of these topics where appropriate.