Buy outright and remortgage, or mortgage first?

thebaldwindowfitter

if your daughter can save £200 on her travel expenses a month then that is her mortgage paid if only borrowing as you say 30k .personnally i take no notice of the doom and gloomers who say property prices will drop further the only reason they will is because every body is talking about it and i would say the majority of people saying such things dont own there own house.if your daughter is planning to stay there for some time she wont lose over all after all if she left home and rented that would be dead money anyway.

hethmar

I think she should buy something smaller than the 3 bed house that needs renovation. Honestly doing up places always ends up a lot more than you first budget for and all the hassle and worry of it :eek: Cant she look for something cheaper and in better condition?

lynnexxxo

I have to disagree with you Hethmar, three bed houses have the widest appeal. Firstly, she is 20, its likely that if she goes ahead she will end up with either a lodger or a boyfriend living with her - so assuming a lodger, thats a bedroom each and (most probably) a small study.
Does the property actually NEED work, or is it just a bit grotty? A new bathroom need not cost a fortune and a clean and lick of paint doesn't cost much (apart from elbow grease).

However I would err against setting her heart on this house, I know its difficult but what if at the auction it goes for much more?

Doozergirl

lynnexxxo wrote: »

I have to disagree with you Hethmar, three bed houses have the widest appeal. Firstly, she is 20, its likely that if she goes ahead she will end up with either a lodger or a boyfriend living with her - so assuming a lodger, thats a bedroom each and (most probably) a small study.

I don't have a study now, let alone when I was 20.

I go with small and managable too - smaller heating and council tax bills, less maintanance. Being a homeowner takes some getting used to.

hethmar

Lynn, she is only 20, things will change in her life over the next 5 years. She could end up with more probs than she imagined on the renovation work and a whole lot more expense. (OP is talking £15k worth of works to get it "liveable" and thats apparently using friends and family.)

Is the £75k just a guide price for the auction? As it could possibly go quite a bit higher. She may be over stretching herself.

mlz1413

I'd borrow what she feels comfortable with until the house is done up and then if your daughter wishes she can pay off some or all of the mortgage.

I bought a run down terrace because it meant when I had finished I'd got the house I wanted with the kitchen, bathroom, carpets and decoration I wanted and it was all new. It's my home and as long as I'm able to pay the mortgage and bills I'm happy to stay.

If your daughter looks at flexible mortgages, I think they are still available, then if she does pay down the mortgage to reduce payments it can always be borrowed back if the situation arises.

lynnexxxo

Hethmar and doozergirl, I can see your point but at resale you have a far wider range of buyers for a 3bed than a 1 or 2 bed flat. Also gives her the option of sharing.

I would agree though that many people have rose tinted glasses on when it comes to how easy and cheap it is to do up a property. The OP didn't really say if it needs major work - new electrics, kitchen, windows, central heating, replastering etc, or whether a good clean and a new bathroom would be enough. Also depends if the girl wants everything to be spanky new and gorgeous, or if shes content with an older but completely functional kitchen and the like.

Also depends if she is happy and content in her job and area.

I know at 20 I'd have blown half the cash on holidays and good times (although I'm now more responsible) so i suppose it depends on the person to.

socrates

Everyone is arguing the toss and the OP has moved on - not much point really is there!

worried_mummy_4

Sorry all - went to bed! The guide price is £65,000+ but I'm thinking it will make somewhere between £70K & £75K, I wouldn't want to pay anymore than that for it and in the current market if it was all shiny & gorgeous it would make about £110,000 - £120,000. The £15K spend is for heating, new kitchen (which I can fit), bathroom & double glazed windows. Her boyfriend is an electrician and will do any works required there, his brother is a plasterer and has also offered to help. Just need a plumber and window fitter. The house is about 15/20 years old and close to the local hospital - so if she did need to take in a lodger it shouldn't be a problem.

puddy

i think it sounds like a good buy, i would buy it cash, then no messing about with valuations and possible pull outs.

then once purchased, things like the kitchen and bathroom can be bought very reasonably from places like b and q on interest free credit, like you say, you are able to fit things and have famiy to do specialist things, she may also want to take either a low cost credit card aorund the 5% mark to buy things, or take out a personal loan over a short period, say 3 years, to do the work, then get it paid off quickly