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  • FIRST POST
    • raj1976
    • By raj1976 9th Oct 16, 12:12 PM
    • 4Posts
    • 0Thanks
    raj1976
    Best way to save for home
    • #1
    • 9th Oct 16, 12:12 PM
    Best way to save for home 9th Oct 16 at 12:12 PM
    Hi - would really appreciate some advice.
    Some background:
    We currently own a house but rent it out due to moving for work/schools and we rent out the house we live in.
    We've had this arrangement for about 5 years and have tried to sell our house on A number of occasions over the last 3 years and is still currently on the market with no great prospect of selling any time soon! LTV on the house is such that we can't take equity out due to the house being of less value than when we bought new. The mortgage itself isn't high and is actually only in my wife's name.
    Can't afford to reduce the house anymore as it'll be in the negative!

    So, frustrated with not being able to sell and buy a home together where we need to be and now being in our early forties I feel the only option available is to get a mortgage myself. I'd really appreciate any advice / information that will help us get to this a quickly as possible.

    - is there any help to buys available?
    - is there any ISAs I should be putting my savings into? Ive read here that there is a long term isa coming soon - could I utilise that?
    - I'm over the 40% tax bracket - is there an effective way to save pre-tax?
    - Is getting a loan for the deposit doable or a no no?

    Any advice would be much appreciated!!
    Thanks
Page 1
    • G_M
    • By G_M 9th Oct 16, 12:47 PM
    • 37,094 Posts
    • 41,049 Thanks
    G_M
    • #2
    • 9th Oct 16, 12:47 PM
    • #2
    • 9th Oct 16, 12:47 PM
    Go over to the mortgage board and/or the property board and ask.

    You won't qualify for HTB:

    To qualify for a Help to Buy: ISA you must:
    • be 16 or over
    • have a valid National Insurance number
    • be a UK resident
    • be a first time buyer, and not own a property anywhere in the world
    • not have another active cash ISA in the same tax year: If you have opened a cash ISA this tax year, you can open a Help to Buy: ISA but will have to take additional steps. See the FAQ for more detail.
    However any ISA would be a tax-efficient way to save. Do some searches for best ISAs.
    • bobobski
    • By bobobski 9th Oct 16, 10:34 PM
    • 398 Posts
    • 1,024 Thanks
    bobobski
    • #3
    • 9th Oct 16, 10:34 PM
    • #3
    • 9th Oct 16, 10:34 PM
    The general advice on this board is not to bother with ISAs unless they're Help to Buys (although as G_M has said, you won't qualify) or if you're earning over the PSA, which for you is £500 interest earned per year. Have a look at the top bank account lists on this forum and the main website to work out where your money should go.

    Other than that, I'm afraid you and I are in a similar position (albeit you already have one house): slog away until you have a sufficient deposit for a house, and put the money somewhere sensible in the meantime.

    Oh, the long term ISA: You mean the LISA I suspect ("L" meaning "Lifetime"). You're over 40 so you don't qualify for that reason too.
    #86: Save £12k in 2016: £7,792.18 / £10,000 (77.92%) | #[ ]: Save 12k in 2017: £0 / £12,000 (0%)
    House deposit by 31/12/2020: £10,763.60 / £60,000 (17.93%) | Emergency fund by 31/12/2020: £294.91 / £5,000 (5.89%)
    • bigadaj
    • By bigadaj 10th Oct 16, 7:29 PM
    • 7,867 Posts
    • 4,797 Thanks
    bigadaj
    • #4
    • 10th Oct 16, 7:29 PM
    • #4
    • 10th Oct 16, 7:29 PM
    The house is worth someone is prepared to pay for it, if this is less than the outstanding mortgage then you either hang omto it or accept the loss.

    If you weren't on the mortgage or deeds of the house then you might qualify for a htb isa, not that we are talking about huge amounts.

    Returns in cash are poor, stocks and shares isas are attractive for many people but they are a long term investment, holding for a short period risks crystallising a loss.

    In terms of being a higher rate taxpayer then the main option for reducing tax is to pay into a pension, not much use for house purchase though.

    You can't borrow for a deposit, that is against the terms of all mortgages that I'm aware of.

    If you are a higher rate taxpayer then you should be able to save a fair chunk of your income, keep at it and things will come together.
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