FTB Mortgage - Not sure what to do!

Don_Vorskla

Hi Guys,

I read the forums quite a lot but never needed to post before.

I'm now in a position to buy a flat, but I genuinely don't know how to even go about getting a Mortgage!

I've haven't been into a bank yet (I will do this in the next week or two) so please excuse my ignorance.

My Financial position.

24 Years Old - Single
Total Money - £45,500
CC Debt - £3,000 (0% until end of July, which I will pay off then (or should I now?)
Income - £26,000 a year (Bonuses work out about £5k a year)

Where my money is.
Bank Account - £2,500
Graduate Bank Account - £0 (£1,000 Overdraft)
ISA - £7,340
Savings Account - £35,500

I'd like to put down about £42,000 fox deposit.

I have a Company Car with expenses so my outgoings for that are pretty low. So my 'take home pay' is quite good. Averagely £1,600 - £1,700 a month.

I'm looking at buying a flat for about £150,000 live there for a year or two then move on. There are 3 other flats in the building for £175,000, the one I've seen just needs decorating and stuff, but I can stretch that out.

Ideally I'd like to pay about £500 a month for a mortgage. But I don't understand the process for it all. I'm an orphan so I don't have anyone to ask unfortunately.

i.e. Solicitors? Surveys? Mortgage fees?

I'm sure some people may roll their eyes at this thread but the little red 'x' button in top right is what you're looking for.

Thanks, in advance.

Thrugelmir

Buying and selling a property involves considerable cost. So although off topic, why 2/3 years in the property?

Don_Vorskla

Thrugelmir wrote: »

Buying and selling a property involves considerable cost. So although off topic, why 2/3 years in the property?

1 bedroom flat is not where I want to be living in 2 years! Plus I'll be earning more money by then and may move offices (but not for 2 years.)

property.advert

You'd have to give me some really specific reason why I would ever buy a one bed flat. The options versus a two bed property are so much less and the price is often only a little more for the two bed. It would be better to stretch to that if you can. Two beds allow people to stay longer as they could even stay until a family was formed. Your buyers down the line will be thinking of that as moving costs so much these days.

I always go for interest only mortgages as they offer you the ability to repay whatever capital you want, when you want. You need a repayment vehicle but you are already on the ISA front so no reason not to continue that.

Don't expect your bank to offer anywhere near the best deal. They will also try to sell you overpriced and crap bold ons and insurances. Just listen to them and bring that information back to google and here to learn just what they are trying to do. Agree nothing.

Pull all your credit files to make sure you know where you stand. 3 agencies to ask.

mij544

You current situation is fine, and you would be wise to avoid the high street as they will only offer information, not advice.

Talk to friends at home and work to see if you can get a recommendation for a good adviser, as they work for you and will help you out.

katejo

property.advert wrote: »

You'd have to give me some really specific reason why I would ever buy a one bed flat. The options versus a two bed property are so much less and the price is often only a little more for the two bed. It would be better to stretch to that if you can. Two beds allow people to stay longer as they could even stay until a family was formed. Your buyers down the line will be thinking of that as moving costs so much these days.

I always go for interest only mortgages as they offer you the ability to repay whatever capital you want, when you want. You need a repayment vehicle but you are already on the ISA front so no reason not to continue that.

Don't expect your bank to offer anywhere near the best deal. They will also try to sell you overpriced and crap bold ons and insurances. Just listen to them and bring that information back to google and here to learn just what they are trying to do. Agree nothing.

Pull all your credit files to make sure you know where you stand. 3 agencies to ask.

Personally I would never have an interest only mortgage. Both of mine have been repayment. With interest only there would be the temptation to not make the payments and to assume that the property would increase in value before you wanted to sell. There is nothing wrong with a 1 bedroom flat if a 2 bedroom one would overstretch you. I had a good sized 1 bedroom one for 12 years. I looked at 2 bedroom ones but either the 2nd bedroom was tiny or the kitchen was tiny.
I found a good mortgage advisor attached to a local estate agent.

Svenena

Have you read through the info on the main site? http://www.moneysavingexpert.com/mortgages/mortgage-guide

tam2oo5

katejo wrote: »

Personally I would never have an interest only mortgage. Both of mine have been repayment. With interest only there would be the temptation to not make the payments and to assume that the property would increase in value before you wanted to sell. There is nothing wrong with a 1 bedroom flat if a 2 bedroom one would overstretch you. I had a good sized 1 bedroom one for 12 years. I looked at 2 bedroom ones but either the 2nd bedroom was tiny or the kitchen was tiny.
I found a good mortgage advisor attached to a local estate agent.

This is a valid point, but it depends on what type of person you are. or again what position you are financially if an interest mortgage would be more suitable.

However with the option with 2 bed flat - i think the previous poster was advising this option as it would be easier to sell in the future. 1 bed flats are limited to single or couples only. So the market your approaching when selling the property is limited. I think with your savings you will have no problem - approach a mortgage advisor . I was like you i had no idea - however a mortgage adviser will try their best to get you the best deal as thats why they are paid.

Good luck

somethingcorporate

That is quite a lot of money for a 1 bed property, you'd find it easier to sell a 2-bed one, which needs to be a consideration if you are moving on quickly. Are there any available where you are for the price range you are considering?

beecher2

You're looking at over 4 times your salary which may be a stretch. A £110k mortgage over 25 years would cost under £500 only if rates are below 3%. You seem to be working out everything on a very short term basis - can't see the point in buying somewhere for only 2 years.