Is it Time to buy and secure a long-term fixed rate mortgage?

mewbie_2

Dithering_Dad wrote: »

Is it working?

Yes, inasmuch as I may be buying todays bargains. No, inasmuch as none of them are doing any other than becoming even more bargains tomorrow.

Dithering_Dad

mewbie wrote: »

Yes, inasmuch as I may be buying todays bargains. No, inasmuch as none of them are doing any other than becoming even more bargains tomorrow.

lol, exactly like mine. I'm slowly making headway, especially with stocks that I decided to average down. I lost 50% of my original RBS shares but bought some more to lower the average. They got £150 into profit this week and boy did I ever cash those beggars in!!!

the_ash_and_the_oak

Which would you rather borrow, 200K at 5%, or 100K at 10%?

And why?

Dithering_Dad

the_ash_and_the_oak wrote: »

Which would you rather borrow, 200K at 5%, or 100K at 10%?

And why?

Do you really think that house prices have a further 50% to drop?

If you ask the same question but with more realistic figures, I'd be happy to engage in a discussion.

Pobby

50% drops? Who knows? Very strange times all round. I have to say that today all this gloom and doom started to get to me. On the plus side no mortgage, except the " technical " £5k interest only. A very nice savings balance earning, ummm sweet fanny adams. What was a decent pension pot, that annuity rates some years ago, would have given us a fair payout. My contract, into it`s 10th year now, yielding far, far less than say 3 years ago.

I recall DD and myself talking about £30k a year as a very nice retirement income. Certainly would be good for myself and my wife, just over a year ago, we were on target for that, not looking that way now.

Now got to a point where I am not sure what to think.

mr.broderick

scousethife wrote: »

your only interest is in YOU!

and the value of YOUR house!

You arnt offering advise to help anyone you are just a selfish prat

I quoted this for you dd just incase you have scousethief on ignore, obviously this won't work if mr.b is also on ignore. Cheers.

Dithering_Dad

the_ash_and_the_oak wrote: »

Which would you rather borrow, 200K at 5%, or 100K at 10%?

And why?

Actually, because I'm bored watching 'Notting Hill' with the missus, I ran your percentages through an amortization calculator (calculates how the real cost of a loan over the length of the term).

Did you know that if I bought a house for £100k with a 5% rate mortgage fixed for 25 years, I would eventually pay a total of £175377.

If Ash & Oak waited for a further 5 years for the market to fall and eventually bought the same house for £64,332 with a 10% rate mortgage fixed for 25 years, he would eventually pay a total of £175377.

Principal----Payment

---

APR

---

Total Interest

---

Total Loan Value
£100,000---£584.59

---

5%

---

£75377.00

---

£175377.00

£64,332

---

£584.59

---

10%

---

£111045.00

---

£175377.00

So we would pay the same amount, but I'd be living in the house 5 years before him and would be mortgage free 5 years earlier too.

I'd suggest people have a play with an amortization calculator to see just how much they're really saving (or not as the case may be) by waiting to buy.

http://www.yona.com/loan/

matbe

Dithering_Dad wrote: »

Actually, because I'm bored watching 'Notting Hill' with the missus, I ran your percentages through an amortization calculator (calculates how the real cost of a loan over the length of the term).

Did you know that if I bought a house for £100k with a 5% rate mortgage fixed for 25 years, I would eventually pay a total of £175377.

If Ash & Oak waited for a further 5 years for the market to fall and eventually bought the same house for £64,332 with a 10% rate mortgage fixed for 25 years, he would eventually pay a total of £175377.

Principal----Payment

---

APR

---

Total Interest

---

Total Loan Value
£100,000---£584.59

---

5%

---

£75377.00

---

£175377.00

£64,332

---

£584.59

---

10%

---

£111045.00

---

£175377.00

So we would pay the same amount, but I'd be living in the house 5 years before him and would be mortgage free 5 years earlier too.

I'd suggest people have a play with an amortization calculator to see just how much they're really saving (or not as the case may be) by waiting to buy.

http://www.yona.com/loan/

Does this include rent payments for five years or would that be on top ?

benood

I agree that interest rates will rise medium term but if you're on a good base rate lifetime tracker you're saving minimum 2% over a present day product - which makes changing to a present day long term fix pretty difficult.

Anyone have thoughts on how to put some sort of 10 year interest rate swap in place?

Dithering_Dad

matbe wrote: »

Does this include rent payments for five years or would that be on top ?

Good point. No, it doesn't include the extra 5 years of rental payments, nor did I factor in the increased stamp duty, the extra VAT on any building or decorating materials or on furnishings and fittings, the extra amount paid to tradesmen who are won't be afraid for their jobs in 5 years (for any decorating / renovations). The list goes on...