Do I have enough left after a mortgage

mattdragon2

I'm making an offer on a house but I am wondering if the remaining money I have at the end of the month is reasonable.

Monthly Pay: 1769
4k yearly bonus before tax.

Per Month:
700 -Mortgage cost
78.75- Council (25% discount as single person)
125 - Gas, electric, water
20 - Building and contents insurance
172.5 - Petrol
200 - food
13 - tv license
35 - internet
10 - mobile
50 - entertainment

Per year
50 Mot
600 car inusrance
135 road tax
500 incase car needs repairs
*107 monthly cost

This leaves me with £247.75 spare at the end of the month.
There are cuts I could make I.E. entertainment, mobile, internet, food, fixing car but I am planning for the worst.

Is £247.75 too less to have at the end of the month spare incase something goes wrong? What do people consider the limit?

DannyboyMidlands

Your mortgage alone will be 40% of your take home pay. That is madness. What happens when rates rise? Or you lose your job? Or get ill?

Do you have any savings as an emergency fund?

AFK_Matrix

Well I was looking at the same amount left over as you and I am on about the same money as you too and I was thinking I could get by but wouldn't have much to spend on anything. I have been lucky though and got a better deal on my mortgage so am now around £400 extra a month and I am also going to try and take on a lodger which will hopefully double that amount. I would say your ok but things will be tight and if you have no savings then if things break etc then your going to have to use credit cards etc so its weather you happy to have that risk?

ads2312

200 a month on food for 1 person is quite a lot. We only spend that for 2 but still eat really well and could get it down if needed.
And £35 a month for internet !! Who's that with as mine costs me a tenner.

shop-to-drop

No don't do it? £700 mortgage on your wage is madness and the mortgage may very well go up in time possibly by a considerable amount.

AFK_Matrix

Surely that depends on weather he has fixed the mortgage or not though? I have fixed mine for 5 years at 695 per month.

DannyboyMidlands

With a mortgage term of 25 or 30 years, a 5 year fix is still effectively a variable rate. What happens in 5 years time when rates could be significantly higher?

shop-to-drop

AFK_Matrix wrote: »

Surely that depends on weather he has fixed the mortgage or not though? I have fixed mine for 5 years at 695 per month.

Obviously fixed is better but is only fixed for a set period. If fixed for minimum of 5 years and is confident income will increase considerably in those 5 years then he may want to gamble.

Cat2011

I think the amount left over is affordable if everything stays exactly as you've said, but I doubt it will. How much do you have in savings? Would you be able to get a lodger (or 2) if you have to?

What about a holiday? Or if rates rise? Or if the boiler breaks? Or your car service costs £1200 (like mine did!) You need to be able to live on this budget for the next 25 years. I'd want to be able to put at least £200/mth into savings for these things, which doesn't leave you with much.

Calculate how much you'd pay if your rate went up 2%. Can you still afford it?

How much is your income likely to rise over the next 10years?

On a side note, my rent to income is 25%, and I don't feel that I could afford much more than that. Think you need to be aiming a bit lower.

mattdragon2

It is fixed for 2 years. Renting a 1 bed flat where I live costs 700 a month except I live in a shared house for a bit cheaper.

My costs are for a worst case so I would expect to have around 350 a month spare.

My internet includes a phone line which is why it costs £35 (half is the phone line).

This is at a rate of 4%.

What would be an acceptable mortgage to take if most people think 700 is too much?

I was thinking I could take in a lodger to help pay the costs too.

My income increases by about 4% each year. I have a bonus of 4k per year before tax but I didn't want to use that in my figures because it is just a bonus.

Beckyy

The limit is what you feel comfortable with.

I personally, would try and cut your food down. The 2 of us spend about £200 on groceries a month, and eat well. The £500 emergency car fund - I wouldn't count that in your budget, and would instead just pay as much as you can into savings each month as an emergency fund. work t purely what your bills will be then work out your food, emergency fund, entertainment from what's left over.