Buy out ex or new house?

aperson111

Having broken up with my partner we're selling our 2 bedroom detached bungalow for £265k.

I have two options:

1. buy him out and end up with a mortgage alone for £168k (I earn around £30k a year and am in my early 30s), with £100k equity.

2. buy a smaller house for around £200k, and have a mortgage for about £120k but with no equity.

Both options will probably require me to get a lodger which I'm happy to do. What would you do?! Any advice gratefully received!

opinions4u

I doubt you'll get a mortgage for over 5.5 x income.

So option (2).

Don't forget that with the stamp duty threshold at £250k and the market not exactly booming you may well struggle to get close to the asking price.

aperson111

Thanks for the impartial advice. I had a mortgage offer for £240k with an £80k deposit, and we already have an offer for that price on the house.

herbiesjp

aperson111 wrote: »

Thanks for the impartial advice. I had a mortgage offer for £240k with an £80k deposit, and we already have an offer for that price on the house.

Do you mean an agreement in principle as opposed to a mortgage offer?

You would only get a mortgage offer if you had submitted full application, and had a survey done on a property that you want to buy.

Who is the lender that has said they would give you a £240k?

dimbo61

Dont be surprised if the people offering to buy your home dont try and drop the offer(price) to £250k and save themselves over £5k in stamp duty!
Please try not to overstretch yourself better to have a £120k mortgage which is 4X your income than get turned down on a more expensive property because you are asking for 5/5.5X income of say £160,000 mortgage.
Lenders are being much more carefull GOOD LUCK

getmore4less

aperson111 wrote: »

Having broken up with my partner we're selling our 2 bedroom detached bungalow for £265k.

I have two options:

1. buy him out and end up with a mortgage alone for £168k (I earn around £30k a year and am in my early 30s), with £100k equity.

2. buy a smaller house for around £200k, and have a mortgage for about £120k but with no equity.

Both options will probably require me to get a lodger which I'm happy to do. What would you do?! Any advice gratefully received!

Don't understand the bold? looks like £80k equity to me

Do you want to keep the cuurent place or not?
You would save money by not having to sell and buy.

Remember to buy out it is the net proceeds as if you sold you need to work on and then consider a bit more as a gesture for saving the selling/buy costs.

Walter_J

I would sell up, bank the money, and rent for a while. Take the opportunity to consider your options at leisure.

There is a very good chance that house prices are about to fall off a cliff. There is no chance whatsoever that they are going to rise appreciably in the short term.

So what's the rush?


You'll probably have a new bloke on the go by Christmas, anyway!