100% Mortgage - should I go for it?

Bobby1_3

Hi All,

Firstly, this forum is great, I've learned so much from you all already. Thank you! :T

However, I'm in a bit of a quandry. I'm finally on a decent wage (£44k) and only have another 5k of debts to clear which I hope to have paid off within the next 12 months.

As I've been so busy clearing my debts, I've never started properly saving. However, I have to leave my rented property within the next 6 months and as I'm now 30, I really would like to buy where I live in London. But as you've guessed, due to paying off my debts I have no deposit and no hope of raising one in 6 months' time. (I can't get any kind of family help or anyone to garauntee a mortgage for me. However I could buy with a good friend but they have no deposit either and are in the same boat!)

So,

1) is a 100% mortgage a viable and sensible option or should I just move to another rented property and wait a few years?

2) is a 100% mortage between 2 people viable and would that be a lesser risk?
:eek:
many thanks! x

Joe_Bloggs

What are you spending your money on ! £44K and can only pay off £5K a year in 12 months ! Getting to grips with your finances is a key part of the MSE ethos. Perhaps you can get better value by spending less, more wisely. Perhaps you can actually save for a deposit and qualify for the best mortgage deals out there, given help and advice. I hope you can find it within you to become your own money saving expert.
J_B,

missk_ensington

Id advise posting your SOA and see if anyone can see where this 44k a year is going!! That is a huge amount of money, triple what most people on here earn. You must have nearly 3k a mnoth coming in, how much is your rent?

Id buy somewhere asap, and save a deposit asap which I think you could do it 6 months but you should post your SOA so everyone can show you how!

Bobby1_3

Well, I should be debt free within less than a year, but I also support my relatives back in Ghana. Although this isn't compulsory, it's something I feel I should do. Also, my rent and travel costs are pretty extortionate from living in london.

After doing a PHD, I had masses of debts and thanks to all your advice on the forum, I have cut back massively and paid a huge chunks in a very small space of time. (Hence I haven't saved as i know to throw it all at my debts!)

Bobby1_3

Well, at the moment my rent, travel, debt repayments and money sent back home is about 1700 per month. Travel is a big outgoing as I have to move about a lot with my job but it should get less in three months. I can also reduce payments home slightly as my family situation is improving.

By the time you've factored in council tax (another hefty outgoing), bills and my pysiotherapy from a recent accident (which happened before I got medical cover with work so they won't cover it and have had no choice but to go private) I don't have much left per month.

But, should have more when travel, physio and family situation improves - at last!

Joe_Bloggs

@Bobby1
I hope you did not find my post critical of your spending habits. If you think you are doing your best and can help others then perhaps say how. What is it about your rent and travel costs that are so bad ? Would moving/house purchase help ? Keeping records of expenditure and making projections into the future is often a fruitful exercise.
J_B.
Edit.
My post Has Been answered by telepathic means !

Bobby1_3

Don't worry! I realised when I posted that it looked a bit odd without any background! Have only been in this job for six months so before was running up massive debts just trying to stay afloat whereas at least I now have enough to live on.

The thing is, being an a much better finacial situation now, just turning 30 and havign to leave my house makes me think I really should be buying and I am throwing away my money renting which is why I was wondering if 100% mortgage might be an option.

Joe_Bloggs

I'm glad your talent has been recognised. Are you sure of where you would wan't to live to minimise housing and transport costs and maximise home ownership benefits. These are personal value judgements but i'm sure your prospects are on the up. Perhaps housing prices will stagnate or fall ?
J_B.

Bobby1_3

Yes I'd like to stay roughly where I am now as I've got good links to all the main locations I mgiht end up working. when I got the job, I knew I'd have to move about and if I'd have moved closer to where I work now it would have been totally unviable for where I'm working next! I work out moving house every 6 months would end up costing me more than just staying in one place. (not to mention being a constant stress which most poeple could do without.)

So really I'd like to stay where I am now and would like to buy here.

thank you for your help.

Joe_Bloggs

Don't listen just to me ! Perhaps wait for the Bank of England to see what they are going to do with rates. Have you seen the 'sticky' guides on the top on the House buying Forum ? Check your credit reports/ establish a credit record.
I wish you every success !
J_B.