Thick Question

Lagerlegs

I can't believe I even need to ask this question but I just can't get my head around it. I currently have a mortgage of just over £90,000 with 18 years to run it was my first purchase. I am now thinking of moving and selling for approx £135,000 now the bit I can't get my head around is without increasing my mortgage what price house can I look at is it £145,000 ? please be gentle with me (hee hee)

Mikeyorks

Similarly can't believe I'm answering it :rolleyes: .... but it is £135k. (You have £45k equity - add a further £90k mortgage ... takes you back to £135k)

And assuming you discount all the selling / repurchase / remortgage etc costs!

homer_j_3

When you sell your house you have to pay the following:

Mortgage
Estate Agent
Solicitor/Conveyancer for selling and buying
Cash fund for removal costs etc
Cash fund for buying - stamp duty, surveys etc

So if you take your sale price of 135k and deduct the money required for the above, this leaves you with a lump sum of money. This money is normally used to fund the deposit of your next purchase. The amount you can borrow will be determined by several factors but mainly -

Your income
Employment status
Credit History
Age

If you work on the basis that you can normally borrow between 3 and 5x your joint salary then you take this figure and add on the amount of surplus you had left to this figure and this is the price range of properties that you can look to buy.

If you do not want to increase your mortgage then you will only be able to look at the same value property minus your costs for selling and buying (if you do have this amount in savings etc)

HTH

Lagerlegs

thank you both for your replies. It's not that I mind taking more mortgage it's just that I am over 45 so don't expect to be able to increase my mortgage, credit and salary no problem, just age really. thanks again