Help!

jalowes2002

Im looking for some advice please.

We have found the house of our dreams but its going to be a massive hike in mortgage.

We are very lucky to be in a position where we have a £200000 house with only £11000 left on the mortgage. The whole mortgage will be paid off in 3 years. While its a lovely position to be in our current house does not meet our needs with an expanding family. Weve worked very hard to overpay or current mortgage, and have a joint salary of £50000.

The house weve seen will mean a whopping increase in mortgage loan of £156000. Ive done the maths, and we could afford a repayment (just) but easily an interest only mortgage without paying much more than we are already on, but with a potential 25 years further paying a mortgage.

We also have an endowment of 25000 which will mature in 15 years time (currently valued at 6000) and costs £69/month.

My questions are- is it stupid to have a pure interest only mortgage? Although we know we will have some early inheritence coming our way in the next few years??

Would you cash in the endowment, or continue paying monthly? If we cashed in the endowment, it would mean we could afford to then have a repayment mortgage. Obviously our current endowment wont anywhere meet the final sum needed.

We have always managed without going overdrawn and are very snesible with our money. I know noone can advise on our direct cirumstances but we have very secure jobs ( i work in health care as a nursing sister).

Hmmmm decisions decisions. We need to make a decision and offer by monday. Thanks in advance, its such a minefield!!

VIGILANT22

Speak to a whole of market adviser who will discuss affordability lending criteria, payments whe rates move etc....and most importantly over committing yourself...

First mistake "We have found the house of our dreams"....don't get emotionally involved with bricks and mortar

dimbo61

1 because you have paid down a lot of your existing mortgage you have nearly £190,000 deposit ( if your home sells for £200k!)
2 With a joint income of £50k a year and a big deposit you should get a mortgage
3 Consider offset mortgages ( inheritence ) and fix for 3/5 years for security while you either overpay or build up the savings in the offset account.
4 the endowment ( is it doing well I GUESS NOT !) give details on forum and some of the experts can give you an idea if better to keep or sell.
5 to take out an IO mortgage you now need a repayment vehicle therefore easier to go repayment ! GOOD LUCK

VIGILANT22

[QUOTE=dimbo61;.
5 to take out an IO mortgage you now need a repayment vehicle therefore easier to go repayment ! GOOD LUCK[/QUOTE]

Not strictly true, depends on lender and LTV....

dimbo61

This is only my opinion and YES it would be a very good idea to see a whole of market mortgage adviser
Point 5 (IO and repayment )
I like things simple and find I like to know how much I owe with a repayment mortgage but each to there own.

VIGILANT22

dimbo61 wrote: »

This is only my opinion and YES it would be a very good idea to see a whole of market mortgage adviser
Point 5 (IO and repayment )
I like things simple and find I like to know how much I owe with a repayment mortgage but each to there own.

I agree with you where poss Repayment is best option, however I just wanted to highlight quote "you now need a repayment vehicle" wasn't strictly correct....:)