FTB - 15% deposit. What are the options?

clloyd22

Good morning all - first time poster and i need of some advice,

Me and my partner are looking to buy a house and take hopefully drop on a bargain. We currently have:

- 15% deposit
- Green Credit History
- No chain

I have researched the mortgage market and struggling for competitive options other than:

- Share to Buy - Britannia Exclusive (4.29 discounted SVR requiring 15% deposit).

- Ulster Bank - 3.79% fixed. Bit dubious about this mortgage due to it being in Ireland (may be assuming the worst), it being a "house purchase fixed rate", is it regualted by the FSA

Just looking to get peoples opinions about the above mortgages and if any other options are available that i may have overlooked.

Thanks,

Chris

unite79

Is the house you are buying in Ireland, If not ulster is not an option!

beecher

Hi do you fit the criteria for Britannia

Applicants must be graduates or hold professional qualifications. For example, an applicant who did not attend university but has an ACA accountancy qualification would be acceptable, as would a commissioned officer in the armed forces. Nursing/midwifery diplomas accepted and HNDs will be considered

Also be aware that the Standard Variable Rate is at the lowest it is going to be and is over 3% above the Base Rate. How will you be fixed when the Base Rate starts climbing again - you might easily be paying well over 7% in the not too far away future.

Maybe going to a broker would be an idea to see if there are better deals out there?

Hippychick

I am fairly sure Ulster bank is Northern Ireland not Ireland.

clloyd22

Thanks for replying.

Ulster Bank is NI - just looked at it in a bit more detail and you need to apply via the branch. So that rules that option out.

As for the Share to Buy Britannia mortgage we both fit the criteria - we have received an AIP from the provider. By the look of things this is going to be the best option at the minute.

I was interested in any experiences and any thoughts on better options?

taker920

Was recently in exactly the same position as you, considered the discounted rate but thought it was too risky (even though the base rate is likely to remain 1% and under until the end of 2010).

As stated Ulster mortgage is only available to residents of NI.

Considered the Britannia 2 year fix @ 5.19% (£500 fee) but didn't fancy coming off this rate in 2 years time when the house price may have bottomed out and face a tricky remortgage or high SVR.

In the end decided on a 4 year fix with the principality (no fee) @ 5.29% to lock in some certainty and hopefully bypass the majority of the recession.

beecher

4/5 year fix does seem a wiser option than a discounted SVR to me - definitely worth looking at the long term rather than taking the lowest rate you can find.

clloyd22

Thanks for the info. I have checked out the Principality 4yr fixed mortgage - looks the best out of the fixed options.

I suppose the question is - with the Share to buy, is the 4.29 SVR going to move very much within that same 4 yr period? Ive just looked at the history of the SVR and it does dart around alot. We are viewing to be in property for approx 4yrs so when the term of the fixed ends it would coincide with the house move.

My last question is - is the share to buy SVR too risky for a FTB? im willing to take a risk but within a 4yr period the SVR could be around 6/7%

taker920

clloyd22 wrote: »

Thanks for the info. I have checked out the Principality 4yr fixed mortgage - looks the best out of the fixed options.

I suppose the question is - with the Share to buy, is the 4.29 SVR going to move very much within that same 4 yr period? Ive just looked at the history of the SVR and it does dart around alot. We are viewing to be in property for approx 4yrs so when the term of the fixed ends it would coincide with the house move.

My last question is - is the share to buy SVR too risky for a FTB? im willing to take a risk but within a 4yr period the SVR could be around 6/7%

Can't help you with the SVR question really as I didn't look into it in that much detail, maybe someone else can advise.

Our opinion in the end was that we are more than comfortable with the repayment on the fixed rate so shelved any concerns about rates for 4 years.

It really comes down to individual circumstances and attitudes to risk in the current climate - I actually think the housing market will stabilise in the very near future so better rates may become available - but who knows what the banks will do with rates considering their current balance sheet positions

clloyd22

Just had a long conversation with an independant financial advisor with who was really honest (to make a change). He basically outlined that he couldnt help me as the best rates (as in the Principality 4yr fixed) are to individuals only.

He pushed towards the Principality being the best rate by a mile and to get an application in ASAP. His view was that the market will stabilise but SVR rates are potentially red herrings and could put alot of people in a mad scramble for a decent fixed rate over the next 12 months.

Thanks for the help and any comments would be brilliant!