advice needed

mepone

I'm looking to buy the 2 bed flat under the right to buy from our council, they have offered it to us for £20,000 and have a £2000 deposit, I'm 26 earn about £23,000 a year with no debt. They have had the house valued at £40,000.
im looking for some mortgage advice on products that would be available to me, or if a loan would be better, would like to pay it off over 10 years, does anyone know any good deals, best places to look or have any good advice for a first time buyer who is a little lost

what is best rate to go for? (fixed, discounted)
and over how long a period

CHEERS

Tim_L

Whether to go for a discounted deal or a longer term fix is really a gamble. Fixing gives stability in budgeting and protection against interest rate rises, whereas discounts tend to be cheaper short term and you take a flyer about what interest rates are going to do. You've got to decide this for yourself, unfortunately, because although there's an expectation rates will rise, no-one really knows for certain.

At the lowish level of mortgage you will have - £18K - to be perfectly honest, it will take a great many interest rate rises to make much of a significant difference to your payments. Personally I'd look for a discounted rate with as little overhang and tie in as possible, then if interest rates appear to be skyrocketting have a look at remortgaging a longer term fix for stability. But this is my opinion, not financial advice!

A good place to start looking is Moneysupermarket. Do a search there, and look at some of the results from the list you'll get. Check the conditions of the offers, how long introductory rates last, whether there are early redemption penalties, and so on (usually there are some catches). You'll gradually get a feel for what is likely to suit you, but bear in mind that mortgage companies know how these comparisons work and rig aspects of their offers to appear high up the list.

You don't generally commit yourself by talking to a mortgage broker, so why not get in touch with someone like London & County, who are well regarded generally? Then come back to this board with what has been suggested and see what people think.

It's well worth checking the details of the purchase with a solicitor before going too far. There may be complications with service charges and maintenance fees, and I remember some horror stories about people buying council flats in the 80s and finding them unsaleable afterwards. It's not that likely that any of this applies to you - these were flats in large tower blocks - but it's worth being reasonably cautious.

theGrinch

not a personal criticism but one of the system.

wondering how someone can be on £23k and live in a council flat and get a right to buy. admittedly, Im not au fait with the way these things work, but does seem the system is very twisted when the government says we are short of resources and when some people are on less than £12k and have never been in a council place.

surely something for reform