First Time Buyer scared of signing papers

Cash00

Hi,

We are about to commit to buying a house that we offered 115 000 & vendors accepted..Mortgage of 103 000 (90%LTV) approved by the lender at a 2 year fixed rate of 6.43% = 643/month..... Two months ago rightmove indicated that the house was worth 120 000 (when we made an offer) but today is worth 110 000. To me it looks like we'l go straight into negative equity the minute we sign the papers and who knows how much more the house will slump by.

Please whats the best thing to do here? Pull out and wait to see the prices drop and try and save more money to get a better deal.

To buy or not to buy?:(

somethingcorporate

What did your mortgage company value the house at?

G_M

Are you looking for a home or an investment? If a home, does this meet your needs, will it make you happy, and how long do you see yourself staying? Property prices may drop, but they'll rise again. Meantime you can play happy families!

If money is your prime concern, and you have financial doubts, walk away - there are other properties.

Cash00

That was a quick reply,

Market Value at Time of Inspection = 115 0000

BitterAndTwisted

I understand why you might be having the jitters if you plan to sell the house on immediately after buying it but not if you're planning to make it a home. Who knows? You could still be living in it in ten year's time. You could have paid all of the mortgage off by then

sarriep

We ummed and errred when we bought our house as we offered an amount that was initially accepted, then rejected. The vendor then asked for the full asking price and wouldn't accept any less.

My very money savvy dad had excellent words of advice for us then - is it worth losing your dream home for a couple of thousand pounds? (Well - 5 to be exact ...) and we agreed it wasn't. As a result we bought the house (probably worth less now than it was then) but have no regrets. It was the perfect home for us and we had looked at many.

Best of luck making the right decision.:)

Hammyman

You're not alone. When we signed the papers, our solicitor said some people are so nervous they can't hold the pen.

Cash00

Exactly what my OH said, buy to live in and enjoy.......Nice house not a bad area and I think we'll own it for a long time. Thanks guys, I think I needed to hear it from those who've done it before. Great words of advice from your dad >Sarriep...... God bless y'all!

azkaban420

Hi, as GM & B&T suggested, it depends on whether you are looking at this as a home or an investment. I personally am looking to buy a home that me and my family can love and enjoy for many years to come. Whether it drops or increases in value isn't as important for me. If I find the right house now, I'm ready to buy and move in even if it drops in value the day after completion.

Think of it this way - how would you feel if you walked away? Absolutely relieved? In which case it's not such a bad thing; or disappointed that you lost out on a house you would have liked to live in? It also depends on how much time you have on your hands and what your situation is. If you can wait for a cheaper/better house, that would work in your favour, but if you're like me, I've had enough of waiting (over a year) and just want a house that ticks all the boxes now. Yes, if I wait longer I could potentially save a few/several thousands, but I'm not prepared to wait much longer. That's why I'm happy to buy now.

Good luck whatever you decide,

Az

iinvestor

can you easily avoid the repayments.

Are your jobs safe, what if you lose your job

Why have you gone for a two year mortgage, rates are expected to rise significantly over the next few years, Will you be able to afford the mortgage if rates rise to 8%?

Maybe you should go for a longer mortgage term ie 5 years.

90% LTV seems high, if prices fall their could be a margin call

Right now its a buyers market, you should haggle hard.

Only you can answer the questions and only you can decide if its worth buying a home

Good luck.

joerugby

Most things that we buy drop in value as soon as we have bought them. There is no reason why a house should be any different, we need to get used to it.

A house is for living in, not for making money. If it's the one for you, you plan to live in it for many years and you can afford it then go ahead. If it's not, then dont