help please!

~Beanie~

I would forget about this house.

Along with a deposit, you are going to need money for solicitors fees etc, furniture if you don't already have it, removal costs if you do. A 5% deposit is £7500 alone and ideally you need more than that.

That would leave you needing a mortgage of over £140K which is more than 5 times your salary and I doubt very much whether enyone would lend that much, especially with such a small deposit.

GDB2222

Hi Angel

Basically, you are wasting your time, for the following reasons;

1. 'Valued at £170k' can mean lots of things. It may be valued at that figure for a forced sale. Or it may be a very optimistic valuation from an estate agent - the sort of thing you might put the property on the market for, but not expect to get. Your friend may not be as nice as you think.

2. Lenders are lending a maximum of 3.5 times earnings at the moment. So you can't get a big enough mortgage together.

3. You need around a 20% deposit these days, so 20% = £30k, plus solicitor's fees and the cost of furnishing the place.


I'm not a mortgage expert, but there are several on this forum and one may be along shortly to confirm what I have said or blast me out of the water.

lotto-dreamer

Firstly take a look at Martin's articles on mortgages on the Main MSE site However, if you are new to understanding mortgages I would also suggest buying a magazine called "What Mortgage" or "Your Mortgage"( usually found at big newsagents/supermarkets)

At the back of the magazine there are handy tables listing different current mortgages available from a variety of lenders- they include current rates, lending criteria such as how many times your salary each lender will consider, loan to value of property, plus what sort of monthly repayment you are looking at etc.

For a quick overall view of mortgages I think these magazines are quite helpful as a starting point in getting a basic idea of what you may be able to consider.

Don't forget you'll need to instruct a solicitor as well (get estimates) and their fees and costs will need to be taken into account. For peace of mind get a homebuyer survey done too. The lender will do a survey but it is more superficial and only to assess value of property for whatever they are prepared to lend you.

Good luck - and remember buying a house can be a bit stressful :rolleyes: and can also take longer than you think! It's not like buying a can of beans at the supermarket unfortunately.

angelcake

ok..... back to reality!

I have been wanting to move for ages as I am in a small 2 bed with 3 children - so 5 of us in here!

I got really excited about the prospect of having a bigger house for my children but prob have no chance! and maybe its not the bargain I thought!

I did a check on prices on the postcode and the house in the middle is the one for sale:

1. 28/03/2008 - £160,000 - Semi - Tenure F - this is the house next door
2. 02/02/2007 - £173,000 - Semi - Tenure F - This is the house I have been offered
3. 31/05/2001 - £78,000 - Semi - Tenure F - Again the house next door (same as number 1)

hethmar

So the one next door sold at £160k 7 months ago? Have a look at a few of the online websites advertising property for sale in your area - findaproperty is one- get a feel for the market locally from that. Also have a look at House Snake to see what houses are being reduced by in your area at the moment.

To be honest it sounds a big confusing - if the husband has lost his job - where are they going to move to?

Dont be too choked, it will give you time to reassess the situation now and probably get a better bargain

poppysarah

If you haven't saved a deposit yourself then the best advice you can have is to save one.

angelcake

They are moving back with her dad - he was promised the job was for keeps but the company went bust (or something like that) so they can't afford the house! She said she has Octobers mortgage payment and thats it so need a quick sale! Its my first time at really thinking about this sort of thing so am going through a lot in my head! my children are young at the moment and really want them to have as much as I can give them and I know I can save for a desposit but it takes time and they are growing up and in the meantime we are squashed here! lol ... we are renting here too! and renting a house in this area costs around £700 a month just for a 3 bed!

GDB2222

angelcake wrote: »

ok..... back to reality!

I did a check on prices on the postcode and the house in the middle is the one for sale:

1. 28/03/2008 - £160,000 - Semi - Tenure F - this is the house next door
2. 02/02/2007 - £173,000 - Semi - Tenure F - This is the house I have been offered
3. 31/05/2001 - £78,000 - Semi - Tenure F - Again the house next door (same as number 1)

Your friend possibly thought he was offering you a bargain, but prices are well down from 2007 levels. The average drop since then is around 13%, which would take the £173k your friends paid in 2007 down to £150k now. So, no great bargain I'm afraid, but at least they weren't trying to rip you off totally.

In practice, if your friends want to sell quickly in this market, they'll need to knock an extra £15k to £20k off, ie sell for £130k, but you probably don't want to be the person to tell them that. In any case, can they afford to sell for that little?

Bf109

angelcake wrote: »

no money at the moment but may be able to raise £5-£8k

Realistically you can look at buying for £50-80k then.

Pretty brutal isnt it? Just goes to show how grossly overpriced houses are at the moment.

edit - also if you have no deposit, its good practise to save for one. You can prove to yourself that you at responsible enough to handle such an enormous debt. Best to find out that you cant handle your money before you buy than to find out afterwards and end up homeless.

FraudBuster

Lie-to-Buy mortgages are difficult to find at the moment.

Advice from FSA:

http://www.moneymadeclear.fsa.gov.uk/guides/buying_a_home/buying_a_new_home.html