Will my girlfriend's job stop us getting a mortgage?

WalkinX

That does help.

Many thanks.

Is a 25 year mortgage advisable? Someone told me once that you don't want a mortgage longer then 15 years.

beecher2

I think 25 years is the average but you can overpay and get the term down. Realistically most people couldn't afford the payments as a FTB if their initial term is only 15 years.

ninky_2

WalkinX wrote: »

I always heard that buying flats are pointless. You rent flats and buy houses hence why I was aiming for houses.

this is nonsense. if a flat is all you can afford it's all you can afford. and many will be in the same position as you and so of course you will be able to sell the flat.

the only reason not to buy a flat now is if you think property prices are likely to crash further making a larger property more affordable to you.

the advantage of buying a flat is that at least you will have some equity that will rise in line with the property market. not so much of a concern now but it is a concern if prices rise considerably making your ability to save for a 10 percent deposit unaffordable.

WalkinX

ninky wrote: »

this is nonsense. if a flat is all you can afford it's all you can afford. and many will be in the same position as you and so of course you will be able to sell the flat.

the only reason not to buy a flat now is if you think property prices are likely to crash further making a larger property more affordable to you.

the advantage of buying a flat is that at least you will have some equity that will rise in line with the property market. not so much of a concern now but it is a concern if prices rise considerably making your ability to save for a 10 percent deposit unaffordable.

Aye that's what I was conerned about.

I mean house prices went soaring high but then have come down - ut then getting a mortgage was harder to do. Now it's better but prices might be going up again so by the tiem we have saved it may be unaffordable again.

Bit of a concern.

ViolaLass

You really need to stop relying on what 'somebody' once said to you - including anything that's been said on this forum. Start watching property sites, consider the places that are cheaper and try to work out why they're cheaper. Also, crunch some numbers. Work out what you could save in, say, the next year, what monthly payments could you afford and how big a mortgage could you therefore afford over what time?

So far 'somebody's told you that you don't want a mortgage over more than 15 years and you shouldn't buy a flat. Perhaps you need to spend some time researching and thinking about these things and considering /why/ 'somebody' may think this. Opinions are not facts or hard and fast rules. Buying a flat may not suit your circumstances or your wishes but I've never heard it said that it is pointless. Still, don't take my word for it, think about /why/ it might be pointless.

Phirefly

ViolaLass wrote: »

You really need to stop relying on.... anything that's been said on this forum.

I agree, but its good that Walkin is seeking advice. I concur with pretty much all the advice here.

Doubtless the person who told you that buying flats is pointless and mortgage terms are generally over 15 years also has the mantra that 'renting is dead money'. Another myth. You can get your independence, get out of the girlfriends parents place, and scratch the homemaking itch by finding a reasonably priced rental property, then sit tight and save hard. You have the luxury of the knowledge that house prices are not going to be escalating out of your reach while you do.

I know we're talking about London and rents are high, but if you were to buy a property with one of the limited mortgage products that would be available to you with only a ~10k deposit, you'd be no better off, and its likely you'd be worse off.

As others have explained, monthly mortgage repayments are made up of 2 parts, the capital repayment (reducing the amount you owe) and the interest payment (the amount you pay to the bank for the priviledge of having a mortgage).

To give you an idea, my monthly mortgage repayments are £793.94. Of that, £151.01 is taken off the total I owe and a whopping £642.93 is what I'm paying the bank in interest. This is the norm in the early years of a repayment mortgage. And with your deposit, in London, with the limited mortgage products around now, you'd probably be looking at even bleaker figures. So renting starts to look a little less like money down the drain, eh?

Hope that helps and good luck... and good for you for seeking advice.

WalkinX

Aye.

Yeah I have heard the "renting is dead money" thing to.

I wnated to get as much advice as I can and while I will look into it nad research of course - as I said in the first post numbers are not my strong point so I wanted some plain english advice that isn't all terms and percentages.

You really think it's possible to rent in london and save enough for place in a decent amount of time? I know we are still in the recession, though claims of coming out of it are now abound, do you think prices won't shoot up in the next few years? I think they are too high as it is really so wouldn't want them going up but everyine seems to think high house prices are a good thing.

I did some playing around with fgures on a mortagge calculater. It's not so bad if we can get an ok deposit ona d a fiarly cheap property even with 5-6% intrest rate it should be doable I think but I am still a but wary although know I will have to and want to take the step someday in the not too distant future.

ViolaLass

Phirefly, I see your point and agree. I was just trying to discourage WalkinX from taking anything he reads as gospel but to think about why somebody might say what they've said.

"You really think it's possible to rent in london and save enough for place in a decent amount of time?"

Define decent. Define 'a place'. Generally, yes but it depends what you're earning, what you want to buy, whether you are being realistic about what you can afford, how much you live within your means etc.

I lived in London Zone 1 until a year ago (I'm 25) and have got my half of a 'house deposit' in the bank right now (having saved for 2 years on c£20k a year) except I'm using it to travel the world for a few years because I think some things are more important than owning your own home sooner rather than later.

WalkinX

Decent = not a graden shed size, damp, rat infest, gun toting estate based !!!! hole.

a place = a flat or small house that is suitable and habitable to rent.

I earn less then £20k. I just started my job in December last year.

I have already travelled. I travelled in 2007 on my own for several months. My gf also travelled for 8 months with a friend. I was born in another country and have moved to the UK to live over 10 years ago, going abroad before I moved and since I came over.

I have done that.

I think owning a home is important and the majority of the population and society of this country would agree.

WalkinX

We have decided to save up £10k each. Do you think this will be enough for London?