FTB - Mortgage expectations?

Supreme_2

Hi,

I need to buy a house. I am terrible at making decisions though, so have been 'needing to buy a house' for 'several' years :rotfl:

What can i expect in terms of a mortgage with the following details:
Pay: £32k
Deposit: £45k (this leaves me with ~3 months pay, and a moving fund)

I am looking at a 30yr mortgage, and it will probably be a 5yr fixed. I will also be purchasing alone and have a good credit history.


Thanks

_Andy_

Depends on things like outgoings but 4x salary should be achievable ie mortgage of c£128k with the deposit on top so property values around £173k

opinions4u

See a mortgage broker.

Find out what the maximum is you can borrow.

Borrow less.

I am looking at a 30yr mortgage

Why? Go for 20 years. If you're currently childless it means there's a good chance you'll be mortgage free before any future offspring hit university.

Supreme_2

opinions4u wrote: »

Why? Go for 20 years. If you're currently childless it means there's a good chance you'll be mortgage free before any future offspring hit university.

Because it makes it cheaper (per month). Cheaper is good when it's a first home and where having the extra cash will come in handy. I would rather have spare cash and the option to overpay as it will make things somewhat easier.

somethingcorporate

Supreme wrote: »

Because it makes it cheaper (per month). Cheaper is good when it's a first home and where having the extra cash will come in handy. I would rather have spare cash and the option to overpay as it will make things somewhat easier.

If you compare the 25yr and the 30yr you will find that the monthly cost difference is actually quite a small value, you will appreciate the extra effort to repay in about 25years and 1 month.

opinions4u

Supreme wrote: »

Because it makes it cheaper (per month). Cheaper is good when it's a first home and where having the extra cash will come in handy. I would rather have spare cash and the option to overpay as it will make things somewhat easier.

Here's a link to the BBC Mortgage Calculator.

£100,000 at 5% over 30 years is £542 a month. That's £195k over the term.

£100,000 at 5% over 25 years is £591 a month. That's £177k over the term.

£100,000 at 5% over 20 years is £668 a month. That's £160k over the term.

£35k saved by paying £126 a month more for 20 years. Then your finances are freed up to pay for the extraordinary challenges of middle age, which are often tougher than the world of the first time buyer.

dimbo61

going off the mortgage figure that Andy gave ie £128K and the best 5 year fix on the market ? YBS 3.39% ( 25% deposit) over 30 years you would pay £557 a month over 25 years you would pay £633 so £56 a month in it!

Supreme_2

opinions4u wrote: »

£35k saved by paying £126 a month more for 20 years. Then your finances are freed up to pay for the extraordinary challenges of middle age, which are often tougher than the world of the first time buyer.

It makes more sense for me to take the £126/month and be able to use it as i wish. I can always keep it back and over pay each year. Then in 5yrs when i come to remortgage i can consider a reduced term.

As a first time buyer, i don't think it makes sense to lock more and more money into a mortgage. I think it makes more sense to have more 'free' cash, that can be used for anything, and if not used, then used for overpayments. It just seems more flexible.

I also don't want to be totally poor during my 20s/early 30s when i should be having fun!

callmechar

Similar situation, FTB with fiance, looking for property in region of £200k (5% deposit so far, still saving and/or considering 95% mortgages). We earn £46k between us. Only debts student loan and childcare, £130 a month.

I too would prefer 25 year mortgage, will remortgage in a few years when more equity then can drop down to 25 years or equivalent

Meeper

Work out what a mortgage would cost you in the area and type of property that you want.
Continue renting.
Pay the difference every month (as well as the lump sum deposit) into a savings or investment plan.
Profit at retirement age.

Being a homeowner is not the golden goose people think it is. Not any more.

Zogger

Meeper wrote: »

Work out what a mortgage would cost you in the area and type of property that you want.
Continue renting.
Pay the difference every month (as well as the lump sum deposit) into a savings or investment plan.

I should start withdrawing £150-200 a month from my savings then...