how much a month is this?

kingsthorpe

Hello,

I new here. Im looking to buy a house. when I sell mine I would have about £40,000 deposit for a new house. I looking at houses priced at £175.000, thinking of offering 10% below so thats £157.000 ish. With the deposit of £40.000, that would been borrowing about £117.000

I have had a look at the deals and its about £670 a month repayment fixed for 5 years over 25 years.

Mu question is - does this sound about right to you?

Thank you for your help

andy

theartfullodger

Depends what "Right" means to you....

For me it would only be "right" if I could afford the repayment and the deal looked a good one compared to others.. And how would I judge that?? Well I'd look at the TOTAL spend I'd make over a period (you seem to be looking at 4 years..), add up ALL the ££s I'd spend (fees, solicitors, valuations, etc. etc.. as well as monthly payments/repayments) and see how much had been paid off after 5 years...


So... let's say (fees plucked from
http://www.fool.co.uk/mortgages/fixed-rate-mortgages.aspx
)

£670x60 + £999 + £450 + £350+£225) = £42,224 paid out, say I've only repaid £7.6k after 5 years (depends on the mortgage co. numbers - ask them what you will have paid off after 5 years)... Then I'd decide if that was "right" for me or not. By comparing the numbers to other deals say....
This one - £42,224 paid out, £7.6k repaid...
#2 £44,534 paid out, £9.2k repaid...
#3 £48,100 paid out, £10.1k repaid....

And which is best.. well.. depends if what you are paying each month or upfront matters most to you.. or can you/can you not roll some of the fees into the mortgage deal so you have cough up less up-front


In other words, it depends, largely on you my dear King...

Then I'd use the executive decision making device - yup, time to toss that coin!

Then I'd decide what House Prices will do over the next 5 years. Wanna know?? (No offence... ) ***c* knows...


Cheers!

Artful

m_13

kingsthorpe wrote: »

I have had a look at the deals and its about £670 a month repayment fixed for 5 years over 25 years.

I'd be concerned about going back to 25 years again. How old will you be then? If you ported your existing mortgage then you may well save costs as you are staying with the existing lender (and may not have to pay so many fees) and would continue with the existing term (which if you started at 25 years last time should be less now). I'd be very wary of having a mortgage past being 60. However, you might be 20 and it not be an issue!

What's the fixed rate you are looking at? Radio 2 yesterday (or could have been the day before) had a programme full of people who had fixed and were having no benefit from the rates having fallen so low. As Jeremy Vine pointed out, had rates risen he would have had a programme full of people complaining that rates had risen and they hadn't fixed low!

Fixing gives you the benefit of knowing how much is going out each month irrespective of what happens to rates but as many people have found now, if the market is a different place when you come out of the fix, you may find yourself unable to fix again.

Fixed mortgages are usually more restrictive in terms of overpayments because the lender too knows how much they are getting from you each month and what you will owe at the end. Both you and the lender are taking a gamble!

davetrousers

Remember additional fees such as Solicitors, surveys etc.