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Debate House Prices
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fixed term mortgages
tassy_2
Posts: 3 Newbie
I am a first time buyer and want to get a mortgage, but also want to move abroad in the next couple of years. If I have a 2yr fixed term, how will leaving the mortgage after the 2yrs affect me?
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Comments
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You'd be better off asking this question in the Mortgages forum or the House Buying and Selling forums - this is a debating forum.
Just quickly though - with most mortgages you can usually sell up without incurring any early repayment charges on the mortgage once you're outside of the the fixed term period. Your biggest problem will be that prices are likely to keep dropping for the next two years so you might find yourself in negative equity when you try to sell up (assuming that's what you are wanting to do).0 -
thanks, first time on here, but will redirect question.0
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Thrugelmir wrote: »Why bother buying for such a short period of time?
I wondered that; maybe planning on renting it out when they move?0 -
i know some guys who did taht a few years ago made a lot of money on house price gains,,,,,unlikely in the near future.I am a first time buyer and want to get a mortgage, but also want to move abroad in the next couple of years. If I have a 2yr fixed term, how will leaving the mortgage after the 2yrs affect me?0 -
If you want to move abroad in a couple of years, why bother buying. Of course it depends on whether or not you intend to sell the property.
If you want to sell up and move: DONT BUY.
If you borrow 200k from the bank at a rate of 5% fixed for 2 years - at the end of this period, the amount owing on your mortgage would be: £191,541.39.
Mortgage repayments up to this point would total £28060.32 (£1169.18 per month)
You would have £9000 extra equity at the end of this period, but after deducting the buying/selling costs, the figure would be far less!
On the other hand, if you rent a property for £700 per month, the saving on the mortgage payments alone would be £11212.32 after two years.
Here is the link for the Mortgage Amortization Calculator:
http://www.shiredirect.com/mortgages/mortgage-calculator/mortgage-repayment-schedule-calculator.php0
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