The Smiths' are struggling to get the mortgage they need.
Is employed full-time
Has a £250 p/m car loan
Has £3,000 in savings
Is employed part-time
Has a £1,500 on credit cards
Has £2,000 in savings
Peter and Claire are looking to move home and have been to see their bank. They need a mortgage of £206,250 but have only been offered £176,600 - BAD NEWS!!!
Peter only has 6-months remaining on his car loan and can therefore be discounted. This will give them an extra £22,900.£199,500 - new max loan available
By increasing the term of the mortgage from 25 to 30 years, Peter & Claire will be able to borrow £10,700 more.£210,200 - new max loan available