FTB Interest only mortgage

davilown

Ok - I've been drawing info from every one lately but hopefully this will be the last!

Found a nice house where I live.
I earn 30k pa and the wife is a student nurse who earns 6k pa. The house is valued at 139,950 and i had an offer rejected today for 126k.

I have an £8k deposit and should be able to get the house for 132,000.

I therefore would need a mortgage of 124,000.

As a ftb i would like to have a 3 year fixed rate at interest only. WIll this be possible for a 95% and if so could I get a reasonable rate?

The interest only period only needs to be for 3 years because my oh would be qualified and earning about 18k and we would have paid all our debts off (aprox 18k).

cheers

:beer: monster

AndrewSmith

Hi,

Various options available to you, all dpending on what you want. I will list a few below.

I have carried out a very quick search using the incomes you gave and the purchase price and mortgage amount posted above. Remember that the amount you are asking for is at the top end of what lenders are likely to offer based on your incomes. This is why some of the rates may not seem that fantastic, however there is no point is telling about rates that you would probably not get due to the income multiples applied. Having said that, this is by no means a recommendation, merely actual research results based on the information given above (before everyone jumps in claiming to know of a better rate etc). Without all your details it is impossible for me or anyone else, qualified or not, to say what is best for you.

In answer to your question, yes interest only is availiable to you as a first time buyer.

The rates:

Chelsea Building Society
3 year fixed 4.64% no extended tie in.
Arrangement fee £495
High lending fee £2062 *
Valuation Fee £270

Monthly payments £479.47 (£489.35 with the fees added to the mortgage)


Bank of Ireland
3 year Fixed Rate 4.69% No extended tie in
Arrangement Fee £499
High lending fee £2237
Valuation fee £240

Monthly Payments £484.83 (£495.33 with the fees added)


Woolwich Open Plan
3 Year Fixed rate 4.79% No extended tie in
Arrangement Fee £495
High Lending Fee £NIL
Valuation Fee £295

Monthly Payments £494.97 (£496.94 with the fees added)



*The High Lending Fee is basically an insurance paid for by you for the lender. If you borrow over 75% it is payable however below 90% most lenders will pay it for you. Over 90% a small number will still fund it for you.
It's purpose is to provide the Lender with an indemnity policy against you failing to keep up your mortgage payments, thus they have a policy on which they can draw to fund reposession and cover they costs and any loss.
This, along with the Arrangement fee can generally be added to the mortgage, remember thought that you will be paying interest on it for the next 25 years potentially.

The decision to make for yourself is do you go with a company such a Woolwich who do not charge this fee, but pay a slightly higher rate, or go for the lower rate and suffer the charges.

That is a decision only you can make.

Hope this helps

Andy