Renting a House

YUNGFARMER2013

To start, I'm sorry if this is the wrong thread.

I'm 19 yrs old, currently in school hoping to go to University next year so I will be in education for the next 4/5 yrs.

Basically I hope to buy a house in Scotland. It is £75,000. It has three bedrooms, lounge, kitchen, bathroom. It is situated two miles from a university, with most rental properties aiming at students. From looking at surrounding properties the going rate is £85 a week including bills. So I would hope to rent it out @ £50 a room a week excluding bills. The rental period is 40 weeks for the students so the income will be £6,000 a year. I will be pay £3,000 a year so in total it will be £9,000 which I will put in to pay off the mortgage. I've got a small income to pay off the council tax and any other expenses.

So basically, say its a £85,000 mortgage over a 10 year period, I will be able to pay £9,000 a year = 9 1/2 years. As I hope I will be out of college in 5 yrs I will hope to get a job, and will probably be able to pay it off earlier. I also live on a farm and I have invested in cattle and hope to make money over the years to come.

Do you think I will be able to get a loan for this or would I need financial backing from say my parents. I say I could do this but I would rather go it alone. Also my dad is experienced in this having owned rental property for a large no. of years.

Does this plan sound viable?

From looking at various sources it should be pretty easy to get tenants as I believe it is a competitive rental price and is a significantly better property than some of the others, being modern and close to the uni etc.

Aint Eazy Being Cheezy

How will you get a mortgage without a full time job and a regular savings pattern?

Pro Hoc Vice

I would say no chance of getting money from a bank in Ireland. Have no idea how a UK lender will look at the proposal. I assume you are ROI based, which will cause issues when looking for a loan. I would say the chance of getting more than 100% loan is a no go in any market at the moment.

Also it seems you are planning on putting a total of 4 people in the house including your self. 40 weeks at £50 is £2k by 3 is 6k will you get 2 people to share a room or accept the living room being turned into a bedroom. What happens if someone does not pay or pulls out your share rises to £5k.

I would say its almost a cert that the bank of parent will have to help out.

YUNGFARMER2013

Johnny Electricity wrote: »

How will you get a mortgage without a full time job and a regular savings pattern?

My income atm is €8,000. I have a part time job and work on a farm. This plan sounds viable and will add £6,000 a year. I'm pretty sure I will be able to pay £9,000 a year if i get it, but I'm just asking if this sounds viable, and if I could go it alone or would need my dads financial backing to get the loan. My dad is pretty experienced with 9 properties in his name. I'm sure I will get the loan if he backs me but would prefer to DO IT ALONE. Surely if I can pay the yearly rate that would be enough????

Also, I just from a quick quote on a 15 year mortgage its £400 a month from RBS. I look to be paying almost double this.....

Aint Eazy Being Cheezy

You don't have to take my word but.. no chance. To put it in perspective, you're 8k yearly income is less than the dole. And your hoping to be granted a mortgage?

You'll need all the help your dad can give you.

Pro Hoc Vice

YUNGFARMER2013 wrote: »

My income atm is €8,000. I have a part time job and work on a farm. This plan sounds viable and will add £6,000 a year. I'm pretty sure I will be able to pay £9,000 a year if i get it, but I'm just asking if this sounds viable, and if I could go it alone or would need my dads financial backing to get the loan. My dad is pretty experienced with 9 properties in his name. I'm sure I will get the loan if he backs me but would prefer to DO IT ALONE. Surely if I can pay the yearly rate that would be enough????

Also, I just from a quick quote on a 15 year mortgage its £400 a month from RBS. I look to be paying almost double this.....

Do you currently live in UK or ROI. If you are moving from Ireland to UK, then you won't have 8k income a year or income from farm. Even if bank accept you have a 10k income the max you should be allowed to borrow is 40k at a push you want more than double that.

Using this calculator http://www.halifax.co.uk/mortgages/forms/minicalc/container.asp putting in 10k income and 6k as bonus (rent) the max borrowing is 58k leaving you short a deposit of 17k sterling. If the income is only 6k sterling and rent of 6k max lending is 41k short 34k.