I'm renting in London – should I try to buy now or wait?

Q I rent in London and I’m on a yearly wage of £28,000. When I have saved enough to put down a deposit on a property (ironically I can save more in London as I have very cheap rent) I would like to move out of London and buy a home in Norfolk. My prospective wages in Norfolk would be £26,000 and I would like to buy a flat for around £80,000 to £100,000. I can’t work out the logistics. Do I buy now with a deposit of £10,000 or wait until I have a larger deposit of £20,000? And do I get a mortgage based on my current wages or my prospective wages?

I understand that mortgage lenders prefer that you’ve been in the same job for a couple of years, so should I relocate now and work in Norfolk (and rent) for a couple of years? Or does the fact that I’ve been in my current job in London for four years show that I’m a good bet? RH

A If you were to apply for a mortgage now, yes the four years in your current job would work in your favour. However, if you waited until you were in your new job before applying, the length of time you were with a former employer would make no difference. The good news is that many lenders are prepared to offer mortgages to people who have been in a new job for just 12 months although there are some who require three years employment in the same job. But according to Pete Mugleston, managing director of Online Mortgage Advisor, “there are lenders willing to consider your new job from day one and some even up to three months before you start if it’s a permanent full-time position”. So waiting until you get your new job in Norfolk may not be a problem but it would make sense to use a mortgage advisor able to identify a lender willing to lend to people in your circumstances. Waiting until you have a larger deposit of £20,000 also makes sense as it’ll help you to secure a competitive mortgage deal.

If you had been about to become newly self-employed – rather than moving to a new job – the majority of lenders would turn you down until you have three years’ worth of accounts or tax statements from HM Revenue & Customs (HMRC). But with the right sort of specialist help from advisers that Online Mortgage Advisor can put you in touch with, it is possible that even the newly self-employed can find a lender who will take them on.


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