40 year mortgages or other long term options

severn777

hi..
AIM...to get a bigger house without paying that much extra per month ??


sounds impossible but ....

1. do 40 year mortgages have any way of just maybe paying the intererst payments when you hit 65..ok you might not of paid off all the capital but you still might have 75 % equity...

2.if this type of scenaio is possible what weould be the best multiples you can typically get ?...[ my wife and i have net income of £35k]

our current house is worth £135k and our mortgage is £124k

hope you get what i mean

cheers

plane_boy2000

why have a 40 year mortgage? why not have a 25 year interest only with e flexible overpayment option that way you could keep the payments down but pay more when you have it like when your income increases etc.

meanmachine_2

I can't begin to imagine the interest you'd pay on a 40 year loan.

OP, this is a moneysaving site, not a bank slavery site.

If you can only afford a bigger house by taking out a 40 year loan, then I'm afraid you don't earn enough to be able to afford it. simple as that.

There's more to life than property you know!

And people wonder why banks make so much profit...

tomstickland

Multiple the monthly payments by the number of months and you'll find that over 40 years you'll pay back well over twice what you borrowed, whereas over 25 you'll pay around 1.8 times and if you pay mortgage off in 12 years you'll pay back 1.25 of what you borrowed. Depending on interest rate, but those sort of numbers.

Jay1b

The only time i would recommend a 40 year mortgage, would be if your in a 'training' type job, where your salary will double within a year or two. Allowing you to remortgage to a shorter 25 years mortgage.

MortgageMamma

Whilst I respect the opinions of those that stipulate the OP would be borrowing too much, it is for the individual to decide on their priorities and how much they wish to borrow. Although it is not recommended, there are ways of funding property purchases past your retirement date. I assume from your net earnings that both of you are self employed? If you worked on the provisional figure of 3.5 - 4 x joint gross earnings that wouldnt be impossible to achieve. You would need to take professional advice, especially if taking a mortgage past your retirement date, as your pension provisions would need to be considered. There is also a greater need for associated insurances in this situation. A good whole of market mortgage broker will be able to help you further.