no savings. how could we move?

lukepugh

vickynleon wrote: »

i also don't want to go into renting because we have worked hard to buy a house and we were very young buying and i think that if we go into renting we will find it difficult to get a mortgage in the future and i hate the thought of paying someone else's mortage when we could have our own, because we have no problem paying the monthly payment our only problem would be that we dont have savings. thnks for any advice.

You could rent out your house to cover the cost of your mortgage (you would need to contact your lender to get permission and they may ask you to change to a buy to let mortgage deal when your current deal ends). This would mean that you are still investing in a property and still on the property ladder but you would then be able to look at renting a 3 bed house for you and your family to live in.
The obvious risk with this is that if you dont find someone to rent your house or if you do and they move out a few months later then you would have a mortgage to pay and the rent for the house you move to.

This may be a risk you are not willing to take but it is another option to consider.

AFK_Matrix

lukepugh wrote: »

You could rent out your house to cover the cost of your mortgage (you would need to contact your lender to get permission and they may ask you to change to a buy to let mortgage deal when your current deal ends). This would mean that you are still investing in a property and still on the property ladder but you would then be able to look at renting a 3 bed house for you and your family to live in.
The obvious risk with this is that if you dont find someone to rent your house or if you do and they move out a few months later then you would have a mortgage to pay and the rent for the house you move to.

This may be a risk you are not willing to take but it is another option to consider.

Yeah that would only be possible I think if they had 25% equity in the property though, and if they had that then getting a new place would probably not be an issue.

And would not the husband going into self employment affect the mortgage as well? I don't know but thought it might be a question for the mortgage adviser your going to see.

penguingirl

Is there any chance your partner could start his self-employed work before leaving his current job? You mentioned that he already has work lined up and a van. My OH works full time and then does bits on the side- it might help boost your cashflow a bit? Obviously that would have its effect on your homelife/his freetime, but I guess sometimes you have to do whatever you can!

Strapped

If you can't afford to save at the moment, then how will you afford a larger mortgage?

Caveat_Mortgagor

The first thing that struck me was that the house you bought 3 years ago will fetch what you paid for it, but you can now get a 3 bedder in your area for 80% of the lowest price when you last looked. Instinctively this just doesnt seem right.

What gives you this belief? Are you moving to a different area that has been more badly affected by the housing market woes than where you live now? Or are you allowing yourself to daydream?

PS - please dont be offended by the direct nature of my question.

LittleMissAspie

vickynleon wrote: »

i took out a long term fixed rate just to make sure. its probally costing us a bit more each month but i can be sure that the rates won't rise. i would also only take out the new mortgage if i could have the long fixed rate.

Are you going to have to pay early repayment fees? Even if you buy the new house with the same mortgage company they don't just transfer the mortgage to the new house. You have to close the old mortgage and take out a new one with whatever rates are applicable when you are applying for it.

I think the most sensible thing to do is try to overpay your mortgage to increase your equity quicker. I wouldn't like to live in cramped conditions (the two of us in a one bedroom house was bad enough, I don't have much tolerance for feeling squashed) either but it gives you even more incentive to save/overpay.

penguingirl

LittleMissAspie wrote: »

Are you going to have to pay early repayment fees? Even if you buy the new house with the same mortgage company they don't just transfer the mortgage to the new house. You have to close the old mortgage and take out a new one with whatever rates are applicable when you are applying for it.

Not necessarily, I know my mortgage allows porting to another property (but I think there may still be a fee associated with this).

Strapped

LittleMissAspie wrote: »

Are you going to have to pay early repayment fees? Even if you buy the new house with the same mortgage company they don't just transfer the mortgage to the new house. You have to close the old mortgage and take out a new one with whatever rates are applicable when you are applying for it.

I think the most sensible thing to do is try to overpay your mortgage to increase your equity quicker. I wouldn't like to live in cramped conditions (the two of us in a one bedroom house was bad enough, I don't have much tolerance for feeling squashed) either but it gives you even more incentive to save/overpay.

We ported our mortgage when we last moved house, even with 6 months in rented in the middle. No fees. Although you do have to complete on the new mortgage within a (generous) certain timeframe.

vickynleon

i would never think about renting out our home because that would leave us in a worse position than what we are now because if someone doesnt pay the rent or i cant find someone to rent my property then i have a mortgage and rent to pay so it wouldnt really work. my partner is currently kitting out his van and will be starting working a saturday afternoon and sunday morning as these are the only times he has free so he will work his butt off and make sure its going to work before giving in his job and chances are if his boss doesnt hate him for leaving that he will be able to have a contract with them to still do work. i'm not really sure about ending fee's i really need to speak 2 my lender but have been ill today so havent had chance to ring so hoping i'll get around to it today.

i no we can survive in this house and there are alot of people in alot worse off position than us but when we work hard for our money and we have worked out that we can afford the monthly payments on our mortgage then why shouldnt we be able to have comfort for our children. i may sound like i'm being silly but i'm just trying to think about my family as a whole and if were stuck here in this 2 bed then me and my partner will be stressing out and then we will argue and it will obviously affect our kids.

we havent even got room here for a dining table so i cant even teach them manner's like sitting at the table, i won't have anywhere to store a pram other than by my front door which is also part of my kitchen so the house is only going to get more cluttered and even smaller again.

as far as i know also the company i work for are safe because were actually moving premises end on the year so i don't think i'll have a problem with my job and the company my partner works for i'm pretty sure they are doing better since the recession so even if my partner doesnt go self employed he will be safe in his job.

vickynleon

also i have had a valued with an estate agent and they that we could fetch about £110k so thats where i have that figure from but judging on house prices on smaller mid link terrace house around the same area i may even be able to push for more or at least put it up for a bit more so that people can knock us down.