Mis advised- FURIOUS

arby

undaunted wrote: »

Possible but dubious surely!

As Courtmill states you pay rent & at the end of it have nothing left to show for it.

You pay interest (lots of it) but your house is traditionally likely to rise in value over time, especially now, as house prices have fallen in the last couple of years but will probably rise again. Getting a mortgage may be a problem these days but for those that do I reckon buying (wisely) is a far far better than renting myself. (my house, though not a new build & direct comparison, is currently worth 2 or 3 times what I paid for it despite the down turn in the last couple of years. I bought it less than 10 years ago & it certainly hasn't cost me that in interest) I'd therefore say Good luck to you Courtmill

your opinion is based solely on the record boom in house prices from 1996-2008. If you'd bought 10 years sooner you'd have had a very different opinion after 10 years of ownership. Don't assume your limited experience is proof of how the future will turn out.

rinkydinkpanther

You're 21 and you already have a four-year failed relationship behind you that isn't your current chap that you're now signing up for a 35 year financial commitment with ? How long have you been with this new guy ? Presumably you never thought there was any risk of the previous guy abandoning you and leaving you homeless either..but he did. Are you going to be joint tenants or tenants in common ?

I'm not saying your relationship is automatically doomed, far from it. I've been with my husband nearly 20 years since we were both 19, but I'm more than aware how rare this is. There's a reason people are cynical about youthful relationships lasting.

And there's also a very good reason people are so negative about your plans to buy this place, it's got disaster-waiting-to-happen written all over it. The extra loan, the price which is already 20k over the valuation, the 35 year term which means you'll basically be paying more in interest for the next 10 years than you would on rent whilst paying back tiny tiny amounts of capital which will almost certainly be wiped out by maintenance costs, the depreciation on a new build and the almost inevitable slump in house prices to come...

Of course you don't have to listen to anyone on here, and I won't say any more on the matter. But if you were a friend or relative of mine I would be doing everything in my power to stop you making this mistake, I couldn't forgive myself if I didn't.

arby

to the above poster, I know that's how i felt while reading the first few posts, but I think it's time we (and chiefly I!) stopped this as we know she's now got the message, and it's up to her to make her decision. she's right that nobody knows the future and you can't always plan for the worst to happen, but in this situation I don't feel like it's a gamble on heads or tails where there's a good chance of it working out, rather it's a bet on shaking a 6 where you're much more likely not to. But we each have to do our own thing. I wish i was 21 again!! One last thing though, you keep saying how terrible it would be to save for the next 5 years then still have to buy. Well how about if you saved for 5 years then got a mortgage with a 25-year term? you'd have it paid off at 51, rather than 56 which is your current plan. So by waiting you'll actually achieve your goal sooner and throw less money down the toilet as you put it. The situation really does cry out for patience.

I'm honestly done now with this. Just consult an independent financial advisor before you do anything. please. not a mortgage broker or EA. Even though you'll have to pay for it, what's £100 when they'll either give you comfort that you're making the right decision or stop you from blowing £150,000!

kai666

Buy the place if you feel it's the right decision for you. But if nothing else get some independent advise. Everyone you has spoken to so far has a vested interest in the sale going ahead, and not necessarily to your benefit

magicgirl

i have three kids in a two bed. I rent. wouldn't make a blind bit of difference if i owned or rented to size of propery.. i have no plans to move from here. its not impossible. just bcos ppl own doesn't mean they must have a room for each child. i shared with siblings growing up. we are all very close

i understand why ppl are dubious but i truly believe its better to risk something you DID do that something you didn't do. I have made mistakes myself financially and have learnt from them. i stil intend to buy my own home one day. i think the OP is in a good osition to find a 2 bed for that sort of price. given that its a two bed being bought, neg equity shouldn't really be a prob. its affording it if rates rise which if they continue to get family support and manage their finances as they have, there is no prob. i do wish you well and hope it all works otut for you but would also say do have a long read of the point people are making in amongst the scarey stuff. most have been polite with their thoughts and it wouldn't be bad to consider in advace how you might deal with some circs mentioned. x

Wutang_2

magicgirl wrote: »

given that its a two bed being bought, neg equity shouldn't really be a prob.

Beautiful sentiment, terrible advice

QTPie

Dinah & Rinkydink & other posters make some really excellent points: buying a house is not always a bad thing (although now is not the best time, I think....), but doing so now while over-extending yourself is.

Personally I am rather shocked that this - basically a 95% mortgage on a new build - is still allowed.... Basically youtake this on and you are in debt over your heads and are paying through the nose for the privilege.

You would be in a HUGELY stronger position in 5 years time: you reckon that you can save £30k (so you could have almost £40k deposit). You could have a lot wider choice of properties (newbuilds are small and lack potential), pay less for it AND pay a lot less to borrow the money. It would also allow you longer to strengthen your relationship (I have been with my husband since I was 19, but statistically that is rare - I am 36 now). An awful lot can change in 5 years - ok it may not, but you have a lot of risks stacked against you....

Someone on here once said that shared equity was a con and I can see why.... They sell you a £130k property for £150k and loan you the difference.... Smart of them, but not good for the buyer!

The smart thing to do is to look at everything and think LONG:A and hard before signing on the dotted line - looking at the terns of your purchase and mortgage deals this is a very costly way of doing things and this could very well become a financial millstone around your neck. IF you decided to pull out now, then £1k loss would be small in comparison with risks/costs involved... and you would not loose face.

Take care.
QT

dopester

Conrad wrote: »

I was reading a short version of a Shakespear tale a while back - one of the main characters was a landlord with 4 small properties.
Shelter is a key commodity and those than own will always enjoy equity in the long term.

Take me; I could invest in a pension that dies when I die (in retirement) and have all the worry of stock markets and whether the annuity provider would survive a serious world crash - or I can carry on gradualy building my own equity that will always have a value in terms of rental. Depsite the odd hassle I'm in the driving seat and I can pass it on to my children.

People who think property has had its day are truly delluded.

That is funny seeing how Shakespeare's own father got carried away with property buying in the boom, paying higher prices and assuming rents would always be paid and couldn't fall - but he got wiped out in the crash which followed. Shakespeare's father lost his property empire, and was very fortunate to keep his own home.

The story of an Englishman whose life illustrates this point has been much in our minds. He is a successful businessman who has fallen on hard times, as so many have. In the early sixties he inherited a farm from his father. He was not much good as a farmer, his hedges were a disgrace to the neighbourhood, but he always had an eye for a bargain. He sold the farm, built up a business in textiles and leather goods, put money into other businesses, and joined the local council.

Before he inherited the farm, as early as the fifties, he had an interest in properties, and as his business expanded, he bought more properties. By the late sixties he had reached a high point in his civic career. He was appointed the bailiff of the local market town in which he lived. His operations were on a substantial scale. He was part of the English enterprise culture before Mrs.Thatcher.

Unfortunately, it was the crisis of the mid-seventies that turned his fortunes for the worse, as it did those of many other businessmen and property people. He was overstretched. Some of his deals went sour. Unemployment was rising and money was tight. Life became a lot less pleasant for him. He had to sell most of the property he had bought, often for low prices, although he was able to keep his home. He retired from the council. There were lawsuits, even appearances in court and threats from the bailiffs. For twenty years he had become steadily richer; for the next twenty years he became steadily poorer

Who is this old man? His name is John Shakespeare; his son’s name is William. The facts are recorded in Dennis Kay’s Shakespeare. The years are correct, but the century was, of course, the sixteenth. John Shakespeare lived on until 1601, “a merry-checked old man,” and saw his son’s theatrical and business success.

Eric1

breaking news:
Persimmon have agreed to pay £500 of the additional £1500. IF we exchange by 23rd July.
Now that, is fine by me. My boyfriend and I are desperate to get things moving, so if this pushes things along, and we get some assistance in the costs... we're sorted!

This may complicate things slightly in terms of the lender- as they have t&c's about where money can come from- but I've been reassured this can be sorted. (Obviously something they've done before....)

why would any business do that, I wonder (actually I don't)

Courtmill, if you still want to go ahead, why not reduce the offer to 149,500?
or I'd love to hear their explanation of why the house has to be sold at 150,000

vaporate

undaunted wrote: »

Possible but dubious surely!

As Courtmill states you pay rent & at the end of it have nothing left to show for it.

You pay interest (lots of it) but your house is traditionally likely to rise in value over time, especially now, as house prices have fallen in the last couple of years but will probably rise again. Getting a mortgage may be a problem these days but for those that do I reckon buying (wisely) is a far far better than renting myself. (my house, though not a new build & direct comparison, is currently worth 2 or 3 times what I paid for it despite the down turn in the last couple of years. I bought it less than 10 years ago & it certainly hasn't cost me that in interest) I'd therefore say Good luck to you Courtmill

lol Better than getting tied down with a mortgage you cant afford, over-priced box.

Most will never pay it off, if ever, in old age.

Pass.