lenders warn low-deposit mortgages are over

Losing_the_way

paulmapp8306 wrote: »

As a FTB - the first one, because on that salery (I earn £37k) the mortgage payments on £135k would be a real struggle, but the payments on a £75k mortgage are manageable.

Its not just the deposit - ultimately if you WANT to own your own home you will save that deposit - whether its £10k or £30k. The mortgage payments are actually a much more important part of the equation. Rates are low now but that wont last.

Im sorry to all home owners, but for a FTB the prices are the issue not the deposit.

The worry at moment is that we could see an unexpectedly sharp jump in rates due to Greece. I rarely see people at the moment that consider that we are living through a period of unbelievably low rates, you have to warn them that rates can and will rise and that they need to prepare for that.
However, for those that have saved a reasonable deposit and are prepared its as good time as any to get started. They've had the advantage of a period were they can afford to settle down and furnish their new homes far easier they we did.

Cleaver

paulmapp8306 wrote: »

As a FTB - the first one, because on that salery (I earn £37k) the mortgage payments on £135k would be a real struggle, but the payments on a £75k mortgage are manageable.

At 5% the repayment on a £135,000 mortgage would be just under £800 a month. If you're on £37,000 then that would represent 25% of your gross income, or probably around 32% of your net income. Would that be a 'real struggle'? Sounds fine to me.

When we bought our first house in 2003 the mortgage payments were around 20% of our joint gross income and we managed fine.

Cleaver

Losing_the_way wrote: »

The worry at moment is that we could see an unexpectedly sharp jump in rates due to Greece.

If Greece defaults then I could fully understand a tightening in lending and a decrease in mortgages as credit as a whole dries up. But not sure I could see a sharp increase in mortgage rates. Do you mean that you see banks increasing their rates to cover losses realised by Greece defaulting?

Jimmy_31

Pimperne1 wrote: »

Corrected that for you Jimmy.

Nice one mate;)

Im moving to an area i want to live in.

If i was staying in this area i would have bought the 25k 2 bed terrace repo. Sadly i will probably have to pay twice that in the nicer town up the road:).

Cleaver

Jimmy_31 wrote: »

If i was staying in this area i would have bought the 25k 2 bed terrace repo. Sadly i will probably have to pay twice that in the nicer town up the road:).

I'm still a bit puzzled about this 'nice' place where you can buy a 'nice' house for £50,000. I know you called me a snob for saying that last time, but I still think you'd be hard pushed.

Pimperne1

Cleaver wrote: »

I'm still a bit puzzled about this 'nice' place where you can buy a 'nice' house for £50,000. I know you called me a snob for saying that last time, but I still think you'd be hard pushed.

Jimmy mentioned that he looked at a place which, if I remember rightly, was about £140k a couple of years ago - there was a bit of a dispute as he thinks its now down to £100k and I think that's its now down to £120k. But, yes, Jimmy has changed the type of house he is after if my recollection is correct (ie going from a potential £140k purchase to a £50k purchase). Wasn't the old one near a colliery or something Jimmy?

michaels

I assumed he had just missed off a zero.

Cleaver wrote: »

I'm still a bit puzzled about this 'nice' place where you can buy a 'nice' house for £50,000. I know you called me a snob for saying that last time, but I still think you'd be hard pushed.

OptionARMAGEDDON

Cleaver wrote: »

If Greece defaults then I could fully understand a tightening in lending and a decrease in mortgages as credit as a whole dries up. But not sure I could see a sharp increase in mortgage rates. Do you mean that you see banks increasing their rates to cover losses realised by Greece defaulting?

I think what they mean is the wholesale price of lending will jump for people remortgaging or abtaining a new mortgage.


For those on 1.99% above base variable rate trackers (IE me), the party is still going strong, with little chance of significant rate rises for the next 5-6 years. :T

reweird

Cleaver wrote: »

I'm still a bit puzzled about this 'nice' place where you can buy a 'nice' house for £50,000. I know you called me a snob for saying that last time, but I still think you'd be hard pushed.

That's because there is no such place, no such house, and no such funds. JimmyLad is a troll.

shortchanged_2

reweird wrote: »

That's because there is no such place, no such house, and no such funds. JimmyLad is a troll.

Hilarious from the person who enjoys hamsters running inside their back passage.