Mortgage Clinic: 'I have a great job - but I've also got large debts'

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I took out a £50,000 loan three years ago to pay for a pilot's training course, and I'm now flying for a living and paying the loan back. My girlfriend and I want to buy a house, but will lenders be put off by the debt?
GM, by email

The question any lender will ask, when you try to arrange a mortgage, is whether or not you can afford it.

Working this out means setting your monthly commitments – in the form of your professional studies loan – against both your incomes. The remainder is your effective salary for mortgage purposes.

The fact that you are paying back your loan over 11 years means that the monthly payments are lower than they would be for a personal loan. At current interest rates, you'll need around £550 a month to cover interest and repayments.

The traditional way for lenders to deal with such debts is to work out how much you have to pay each year – around £6,600 – and deduct that from your salary for mortgage purposes. They would then add that to your girlfriend's salary, multiply it by three, and the resulting figure would be the total you can borrow.

If you were buying alone, the typical lender would offer three-and-a-half times your salary, after deducting the training loan repayments. So you'd be able to borrow around £23,000 less than if you did not have the loan.

Lenders are also increasingly willing to be flexible, says David Hollingworth, director at mortgage brokers London & Country. More and more mortgage companies use so-called "affordability" calculations, rather than simply using salary multiples. If you have a good credit history, a lender might well be willing to go beyond three times your joint income, especially as you expect your earnings to rise.

Some lenders offer more generous terms to professionals. Most do not include pilots in this, but Hollingworth says that Standard Life will offer up to five times' salary to BALPA-registered pilots. It might also be worth speaking to HSBC, as they provided your original loan.

If none of these options work, then your best route might be to pay off as much of your loan as you can. But you should check the contract to see if there are early repayment penalties first.

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