SOA Help

dotexe

Hi guys. We haven't actually bought our house yet but I'm interested to see what you all think of our budget and whether you think we're way off on anything or how we can improve.

I also work overtime which can vary between £300-500pm and hope to put this toward overpaying on the mortgage.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 1057
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2257
Monthly Expense Details
Mortgage................................ 621
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 130
Electricity............................. 30
Gas..................................... 30
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 10
Mobile phone............................ 60
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 300
Clothing................................ 40
Petrol/diesel........................... 80
Road tax................................ 20
Car Insurance........................... 40
Car maintenance (including MOT)......... 40
Car parking............................. 4
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25
Pet insurance/vet bills................. 0
Buildings insurance..................... 10
Contents insurance...................... 10
Life assurance ......................... 6
Other insurance......................... 0
Presents (birthday, christmas etc)...... 60
Haircuts................................ 15
Entertainment........................... 40
Holiday................................. 0
Emergency fund.......................... 100
Savings................................. 200
Total monthly expenses.................. 1928

Assets
Cash.................................... 0
House value (Gross)..................... 142500
Shares and bonds........................ 0
Car(s).................................. 4000
Other assets............................ 0
Total Assets............................ 146500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 113000...(621)......4.39
Total secured & HP debts...... 113000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-

Monthly Budget Summary
Total monthly income.................... 2,257
Expenses (including HP & secured debts). 1,928
Available for debt repayments........... 329
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 329
Personal Balance Sheet Summary
Total assets (things you own)........... 146,500
Total HP & Secured debt................. -113,000
Total Unsecured debt.................... -0
Net Assets.............................. 33,500
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

InDeepDebt

First thing that comes to mind is your mobile phone bill - this could maybe go down if you are not on a contract. It all depends how much you use your phone and whether you want/need a new handset each year.

Groceries for two seem slightly high - actually, that's a bit of a lie. They're about average but you could reduce your bill by shopping around. Our grocery bill for a family of four is just over £300 - that said, I have the luxury of plenty of time to do a daytime shop at the likes of ALDI and LIDL as I work shifts.

Overall though, it looks good. If it's a true reflection of your spending, you have a surplus AND you're putting into an emergency fund plus savings. Keep it up.

opinions4u

dotexe wrote: »

Hi guys. We haven't actually bought our house yet but I'm interested to see what you all think of our budget and whether you think we're way off on anything or how we can improve.

I also work overtime which can vary between £300-500pm and hope to put this toward overpaying on the mortgage.

Statement of Affairs and Personal Balance Sheet
Household Information
Number of adults in household........... 2
Number of children in household.........
Number of cars owned.................... 2
Monthly Income Details
Monthly income after tax................ 1200
Partners monthly income after tax....... 1057
Benefits................................ 0
Other income............................ 0
Total monthly income.................... 2257
Monthly Expense Details
Mortgage................................ 621
Secured/HP loan repayments.............. 0
Rent.................................... 0
Management charge (leasehold property).. 0
Council tax............................. 130
Electricity............................. 30 Seems low
Gas..................................... 30 Seems low
Oil..................................... 0
Water rates............................. 25
Telephone (land line)................... 10
Mobile phone............................ 60 Potential to save with SIM only or PAYG
TV Licence.............................. 12
Satellite/Cable TV...................... 0
Internet Services....................... 20
Groceries etc. ......................... 300 Could be cheaper if you want it to be
Clothing................................ 40
Petrol/diesel........................... 80 Seems like modest use. Do you really need two cars?
Road tax................................ 20
Car Insurance........................... 40 Seems cheap for two cars
Car maintenance (including MOT)......... 40
Car parking............................. 4 a month?
Other travel............................ 0
Childcare/nursery....................... 0
Other child related expenses............ 0
Medical (prescriptions, dentist etc).... 25
Pet insurance/vet bills................. 0
Buildings insurance..................... 10
Contents insurance...................... 10
Life assurance ......................... 6
Other insurance......................... 0 Have you conisdered PHI or critical illness cover?
Presents (birthday, christmas etc)...... 60 Seems generous to me
Haircuts................................ 15
Entertainment........................... 40
Holiday................................. 0 No holiday?
Emergency fund.......................... 100
Savings................................. 200
Total monthly expenses.................. 1928

Assets
Cash.................................... 0
House value (Gross)..................... 142500
Shares and bonds........................ 0
Car(s).................................. 4000
Other assets............................ 0
Total Assets............................ 146500

Secured & HP Debts
Description....................Debt......Monthly...APR
Mortgage...................... 113000...(621)......4.39
Total secured & HP debts...... 113000....-.........-
Unsecured Debts
Description....................Debt......Monthly...APR
Total unsecured debts..........0.........0.........-

Monthly Budget Summary
Total monthly income.................... 2,257
Expenses (including HP & secured debts). 1,928
Available for debt repayments........... 329
Monthly UNsecured debt repayments....... 0
Amount left after debt repayments....... 329
Personal Balance Sheet Summary
Total assets (things you own)........... 146,500
Total HP & Secured debt................. -113,000
Total Unsecured debt.................... -0
Net Assets.............................. 33,500
Created using the SOA calculator at www.makesenseofcards.com.
Reproduced on Moneysavingexpert with permission, using IE browser.

You appear to have a lot of slack built in to your budget. Enjoy!

pennypusher

Hi You don't seem to have mch spare each month. Have you considered what you would do if the mortgage rate went up, it has been as much as 15% in the past. Can you afford it, or do you need to think about fixing your rate?

dotexe

gem68 I'm very sorry I've posted in the wrong place. I'm new to the forum and was just looking for the best advice.

pennypusher that is exactly what I'm worrying about. The £621pm is for a 5yr fix. The property is a new-build and I can't help but wonder what trouble we may be in if once our fix is up A) The rates have shot up or the house has fell in value or worse, both.

Everyone around me seems to think it will be fine. My Dad says in 5 years time the house will have increased in value and I will be sitting on more equity thus being able to get a better mortgage.

I can't help but think he's being old fashioned. There is already an identical property 2 years old around the corner not selling at 13k cheaper. It's hard to make a decision not to go for it when everybody is so confident it will be OK.

rising_from_the_ashes

gem68 wrote: »

this is a debt free board,for people with debt problems.

as your only debt is mortgage and you have a surplus each month i think maybe move to the mortgage free wannabe board,it would be a little less insensitive!

:(Sorry but I don't agree...... you do not have to have debt to be a DFW - you can come here to ensure you don't end up with debts.....

Although the vast majority of people on here do have debts to clear, if asking for advice before undertaking a huge financial commitment (such as a house/mortgage/bills etc) gives someone some guidance and stops them appearing back in a couple of years asking for help as they are now in debt .... then that's a perfectly reasonable request IMHO

rising_from_the_ashes

Please ignore Gem68 - she seems to have forgotten to "be nice" to a newbie:(

Your SOA looks OK and I would agree with Opinions4U's comments.

Just wondering if you've had a house before?

If not, my advice would be to open a totally separate bank account and use this for all household bills etc - you can both pay in a set amount each month when you're paid to cover the d/debits (and a bit extra for the emergency fund etc if you want. The "golden rule" is to never use this account for anything else - no switch payments, no cash withdrawals etc.

The big advantage of this is that you never have to worry about whether a d/debits yet to come out / missing a payment etc as there is always enough money in it to cover everything.

Whatever is left in your other account(s) is "yours":)

dotexe wrote: »

I can't help but think he's being old fashioned. There is already an identical property 2 years old around the corner not selling at 13k cheaper. It's hard to make a decision not to go for it when everybody is so confident it will be OK.

What is your LTV rate?

TBH if there is an identical one for £13k cheaper, I'd be reluctant to pay more than that - is there a reason for this?

The markets a total unknown as to what will happen in the next few years - who would've thought in 2006/07 that prices would've crashed so far .....

dotexe

Adelaidess, I'm not technically debt free I have a student loan but like rising from the ashes is saying I'm trying to avoid being in debt later.

rising_from_the_ashes wrote: »

Just wondering if you've had a house before?

If not, my advice would be to open a totally separate bank account and use this for all household bills etc - you can both pay in a set amount each month when you're paid to cover the d/debits (and a bit extra for the emergency fund etc if you want. The "golden rule" is to never use this account for anything else - no switch payments, no cash withdrawals etc.

The big advantage of this is that you never have to worry about whether a d/debits yet to come out / missing a payment etc as there is always enough money in it to cover everything.

Whatever is left in your other account(s) is "yours":)

No, we haven't had a house before or even rented. We are still living at home with parents right now. So it's all very unknown and all very scary!

But yes this is what we were planning to do. Open a joint account, pay a set amount in each month for everything that is shared.

rising_from_the_ashes wrote: »

What is your LTV rate?

TBH if there is an identical one for £13k cheaper, I'd be reluctant to pay more than that - is there a reason for this?

The markets a total unknown as to what will happen in the next few years - who would've thought in 2006/07 that prices would've crashed so far .....

I just assume we're paying a premium for the new build. Which is worrysome. A shiny new blank canvas is so appealing but it's not worth risking getting in trouble right? Some houses in this area which were new builds 2 years ago have dropped 20k in value. Not to mention we're paying for fittings, carpets, lawns, fences etc.

Our LTV is just under 80%. Worst case scenario would be the rates shoot up, and our deposit is obliterated by the value falling once it's no longer new. We'd be in trouble. Of course this is all theoretical but I'm not sure it's a risk I'm willing to take.

My Dad says "he who dares, wins" and all that. I'm not a risktaker though. I don't think I would be happy in this house with the worry.

rising_from_the_ashes

dotexe wrote: »

Our LTV is just under 80%. Worst case scenario would be the rates shoot up, and our deposit is obliterated by the value falling once it's no longer new. We'd be in trouble. Of course this is all theoretical but I'm not sure it's a risk I'm willing to take.

My Dad says "he who dares, wins" and all that. I'm not a risktaker though. I don't think I would be happy in this house with the worry.

Your LTV rate is OK and could take a bit of a "hit" if prices drop but it's still "lost" money.

TBH, if you're not sure or have any doubts .... walk away.

It's a buyers market and there is always another house - your first one especially should be enjoyed and not be something that you worry about (sorry if that's not what you want to hear).

bouncydog1

If you like the area and there is a similar house available several thousand pounds cheaper, why don't you have a look at it? You have to go in and ignore the decoration and furnishings and imagine the property styled to your taste.

Just think what you could do with the cash if you could knock down the purchase price by £20k? Your loan could be repaid 3 years earlier by paying the same amount each month. Alternatively your deposit would be a little less and you would have the funds available to redecorate to your taste.

New builds are very attractive, but if you buy a property a couple of years old then any new build issues should already have been taken care of. By the way I think your very sensible coming onto the board before you get into debt - a great pity more people didn't do things this way. Negative comments are often from those who wish they had done things differently!

Good luck with whatever you decide.

littleskintdragon

hi just popping by and wondering if you've used the fact that there's a house for 13k cheaper to your advantage and negotiated with the builder?

I would tell them that your considering your options within the 2nd hand market because of the price difference?

They want people like you to buy as you have no chain and for that reason wouldnt want to lose you.
Is the house for sale with a big company or a smaller builder?

Tell me not to b nosey if u want