little worried about my mortgage and other costs of living

michalp

Hi… (Sorry if I make spelling or other grammar mistake – English is not my first language)

I’m just about to complete and get keys to my first property in UK J Finally after 6months of dealing with very unprofessional mortgage advisors, lazy property agent etc etc… I’m ready to move in… but I’m little worried about my finances.

I give you my finance plan so please tell me what you think – Am I safe or not… You have more experience living in UK J It’s my first mortgage J so please understand my worries.

My salary (on hand) is £430pw (£1720pm if is 4 payments – or £2130 if is 5 weeks). The salary should increase next year 5-15%.
No other incomes – maybe something but not regular – let say +£1000-1500 per year

1) The mortgage is £399 interest only for 30 years (life tracking +0.85% to Bank of England Rates)
2) I’m planning to open an ISA account and pay up to £150 per month till I be able to repay the mortgage
3) I have 3 loans – first: £127pm (32x left) and £34 (14x left) and £75 (dfs – I will start repaying about 09/2009.
4) Car Insurance - £34pm
5) Just repaid my credit card so its £0 J FINALLY!
6) Because its Leasehold I will be paying £103 per month (water!, building insurance, window cleaning and gardening included)
7) Diesel – approx £100 per month (for driving to work)
8) Mobile £30 (contract – 16m left)
9) TV license not needed – I don’t like TV J I’m using TV to watch dvd/divx only.
10) Internet £15
11) No gas in my property – only electricity

Summary: £1067 (incl. future payment for dfs sofa and £150 ISA saving account). This amount is flexible because I don’t have to pay ISA every month.

My girlfriend is currently not working – she is waiting to be registered as a physiotherapist in uk so she can’t participate in all costs.


So £653 will stay on my account to pay for food (2 people and a dog) and electricity (average £40 per month – well isolated flat). Is it safe?
Those months which got 5 weeks (salary) will give me extra £430 to my budget to cover other expenses like holidays etc.

Hopefully my girlfriend will start working soon…

What do you think… should I be worried or not? Its stressing me very much…

beecher

You need to add Council Tax onto your outgoings. £40/month for fuel sounds a bit low too, but I suppose it depends on where you live.

Can I ask why you have chosen not to have a repayment mortgage? I'd be worried about the fact that you may not pay into your ISA every month if an unexpected bill comes up, ie car repairs.

michalp

beecher wrote: »

Can I ask why you have chosen not to have a repayment mortgage? I'd be worried about the fact that you may not pay into your ISA every month if an unexpected bill comes up, ie car repairs.

because real value of that property is much higher. The vendor was desperate to sell it so I've managed to get £45k off from £140k to £99.5k (he bought it in 2004 for £155k). Im a designer so I'm going to redesing/redecorate that flat and sell it for much more in about 4-5 years.

ISA will support that mortgage in case If I decide to keept that flat.

beecher

That does sound like a bargain - what was it valued at by your lender? I'd keep that in mind as the true value when you're calculating how much it might be worth in 4/5 years, rather than focussing on the £155k figure. Also don't rely too much on redesigning and redecorating adding much to the value.

Good luck.

michalp

Whole Idea of redesigning it is to add more modern style to that flat (its already very modern but something is missing there). We want to live comfortable there for at least 4-5 years.

Lender valuation is £135k

getmore4less

there are alot of things missing from your list.

If you got to the debt board
http://forums.moneysavingexpert.com/forumdisplay.html?f=76

and read a few threads you will see the kinds of things that others have.

also
http://forums.moneysavingexpert.com/forumdisplay.html?f=20

for budgeting advice

You need to account for all expences so there are things like car tax,insurance missing.

A full SOA will help fill out your picture here is one
http://www.makesenseofcards.co.uk/soacalc.html

Fly_Baby

michalp wrote: »

9) TV license not needed – I don’t like TV J I’m using TV to watch dvd/divx only.

You are going to need TV license if you have a TV or any equipment that can receive television (TV-tuners for PCs etc) at home. The fact that you are not using your TV to actually watch it is irrelevant for the TV Licensing people, I am afraid.

So it is another 12-13 pounds per month.

michalp

not if I ring them and tell them I dont watch tv. I did that last year and it was ok for them. I did tell them they are welcome any time to check it.

Fly_Baby

I am surprised that they are so cooperative. I didn't need TV license for a while because I didn't have a TV at all - and still when I phoned them up, they kept asking if I am sure that my laptop doesn't have any TV-receiving equipment. That's when they said that TV license is needed even if you just have a TV - because they cannot check if you are using it or not.

michalp

they are welcome to check it

Fly_Baby

I am really curious now - can they really tell if you are using your TV for TV or not? I thought they just presume that you CAN use and cannot prove that you HAVEN'T been using it hence you have to get the license. How exactly will they be checking?