Help with buying house.

Dithering_Dad

geoffky wrote: »

IF you havnt a clue what are you doing buying a house now...you havent a clue have you? do you understand the term negative equity if not i would look it up because its going to be your best friend for a few years to come...

Why not give the OP the advantage of your knowledge and explain to him how he will end up in negative equity on a house he's bought that was already significantly reduced and with a 20% deposit?

Or as another poster has suggested, are you simply against anyone buying something you cannot? What a plonker, Rodney.

andrewmp

neverdespairgirl wrote: »

Are you certain about that? I'd check your mortgage offer, as very few are fixed for 25 years.

You are right, very few are fixed for 25 years but mine is and that's the only one I care about. I know you're only trying to help so I gave you a thumbs up thanks anyway!

If this 25 year one fell through for whatever reason I'd go for a ten year one. I realise rates might drop but would rather pay a bit more than the lowest to ensure I know where I'm at. I have a get out free after ten years so if rates are low then I'll get a new deal.

Incisor

Dithering_Dad wrote: »

Why not give the OP the advantage of your knowledge and explain to him how he will end up in negative equity on a house he's bought that was already significantly reduced and with a 20% deposit?

Or as another poster has suggested, are you simply against anyone buying something you cannot? What a plonker, Rodney.

Or how about you justifying that the OP does not even need to think about negative equity? Or justifying that even if the OP avoids negative equity, the loss of 90% of the equity from a 20% deposit is not serious financial damage to the OP?

Incisor

cee2 wrote: »

Why do some people have to bring down those who are trying to buy houses at the moment, is it jealousy?
Maybe people are buying a home, not just a house and intend to stay in it for years to come.
If you buy a car on hp or a new telly on credit you are instantly in negative equity. Perhaps if people spent less time bleating on about 'negative equity being your friend for years to come' and more time on better things then life would be a more pleasurable experience.

And why do some other people prefer to conceal the serious financial risks inherent in buying a home in the current financial climate?

It is legitimate to decide to purchase, but it would diminish these forums to encourage the OP to buy without considering the financial risks from house price deflation even if they are not taken into negative equity.

neverdespairgirl

andrewmp wrote: »

You are right, very few are fixed for 25 years but mine is and that's the only one I care about. I know you're only trying to help so I gave you a thumbs up thanks anyway!

Fair enough - just thought it might be a good idea for you to check, as it is rare.

*jobags*

Incisor wrote: »

And why do some other people prefer to conceal the serious financial risks inherent in buying a home in the current financial climate?

There are serious financial risks in everything we do - from the moment we hit the snooze button on the alarm in the morning to the moment we say "not tonight dear I'm too tired/I have a headache"

If he is buying a home rather than a house then the chances are he'll be OK - it's the same for all of us - just what are you willing to sacrifice in your day to day life for the chance of one day owning your own home outright and the hope that one day you'll be able to turn round to your employer and say "go forth and multiply" (or words to that effect)

Jo

cee2

Thanks the key to it all I feel, the difference between buying a house or a home. I personally want to live with my family in a home without moving constantly. I ignore any increase in value in my house because its not real hard cash in my pocket, I can happily do the same the other way because when we move house its for a minimum of 10 - 15 years and in that time I am sure any problems will have stabilised.
As I have already said its down to treating where you live as a house or a home.

Doozergirl

Incisor wrote: »

And why do some other people prefer to conceal the serious financial risks inherent in buying a home in the current financial climate?

It is legitimate to decide to purchase, but it would diminish these forums to encourage the OP to buy without considering the financial risks from house price deflation even if they are not taken into negative equity.

This forum is full of news about the associated risks. Presuming that the OP managed to read at least one post before they started a thread, the facts annd opinions are all here laid bare.

Being treated like an idiot by a knowitall who cannot even begin to know the OPs financial situation (because we weren't told) or motivations doesn't help the OP or anyone else for that matter. It's insulting. It's also a shame that people can't be credited with enough intelligence to have perhaps watched the news ever and a made a balanced decision, or the respect to just have the question answered that they were asking.

It's like some weird kind of attention seeking or oneupmanship - "I don't know anything about you but you're reeeeeeely stupid, so stupid that it's a waste of time trying to quantify my argument (or maybe I'm just incapable because I don't really understand what negative equity is)"

You might as well just write "I reckon I'm better than you, so ner" for the help posts like that are.

GDB2222

Just a general note about the procedure for house purchase. In this country (England that is), a contract to buy a house must be in writing. You can say whatever you like, and it's not binding.

However, if you commit anything to paper, you may unwittingly be entering into a binding contract. So, if you say in writing 'I offer to buy your house for £150,000', that's it, you've made an offer that is capable of acceptance (in writing) and will then be binding on you. The way to avoid this is to include in your letter the magic words 'Subject to Contract'. Better still, get legal advice before making any written offer at all. To be frank, you may be better off spending a bit more on a local high street solicitor whom you can talk to than using the cheapest internet-based service.

I would just add that the residential property futures market is 'predicting' a 20% fall in prices from today's prices.

andrewmp

GDB2222 wrote: »

Just a general note about the procedure for house purchase. In this country (England that is), a contract to buy a house must be in writing. You can say whatever you like, and it's not binding.

However, if you commit anything to paper, you may unwittingly be entering into a binding contract. So, if you say in writing 'I offer to buy your house for £150,000', that's it, you've made an offer that is capable of acceptance (in writing) and will then be binding on you. The way to avoid this is to include in your letter the magic words 'Subject to Contract'. Better still, get legal advice before making any written offer at all. To be frank, you may be better off spending a bit more on a local high street solicitor whom you can talk to than using the cheapest internet-based service.

I would just add that the residential property futures market is 'predicting' a 20% fall in prices from today's prices.

Thanks, I've already instructed a solicitor, not local, in Macclesfield, they have a telephone number I can contact them on though.

A 20% fall from todays "prices" will take it rougly to what I paid so that'll be ok with me. I'm not going to take that risk though as I'm getting a long term fix so if I do end up on negative equity or even a lower LTV then I don't have to get a new fix etc.

I've preached to people lots about not buying a house, how there will be a drop. I'm getting a two bed semi in a nice enough area for nearly 20% less every month than I currently pay on rent. In 15 years time I'm sure my rent would have risen, I just need to ensure I put away so much per month for other costs you don't have when you rent, things going wrong etc.

I haven't made an offer in writing, would this normally be expected?