All savings towards deposit gives 3.94 rate

nunu_2

Hi,
Just looking for a bit of advice please. Im looking to buy my first house (exciting in a scary way!) Been to see my bank, hsbc, who can give me a tracker mortgage at 3.94% IF I pay a 25% deposit. It tracks (sorry if this sounds nonsense) for full term of mortgage and you can make unlimited overpayments (mortgage free wannabe in the making) - also there is no fee.

The house Ive made an offer on is 85k (bargain as it was originally up for 116k) so the deposit would be £21250. Luckily I have enough in savings to pay this but it would only leave me with enough to pay off my holiday to florida this June.

I wont have any big expenses when I move in as I have most of the furniture. Im just a bit worried about having no savings.

Any advice would be very muchly appreciated. Thanks:D

Kavanne

Do you need a holiday to florida? I am not going on holiday this year as I would prefer to have a new bathroom.

If you do an SOA you can see what your surplus income is and start to build up your savings pot again: http://www.makesenseofcards.com/soacalc.html

herbiesjp

Have you done a budget?

Do you have much disposable income left over at the end of the month?

Would you be able to cope if rates started going back up again?

Have you considered fixed rates?

The reason why getting a fixed rate now could be better, is that if house prices continue to go down, you will find yourself with an LTV over 75% and those rates will no longer be as attractive as the fixed rates that you could currently get at 75%