Wise words of advice wanted for ignorant fool!

patrick_bs15

Hi
I've got a one bed flat which I still owe £21, 745 on. Got 2.99% fixed rate deal with FD which expires in November.
If I sold my flat now I reckon (conservatively) it would fetch £69,000. Kind of flat I'd like to move to (in more convenient part of city) has got an offer of £86,000 on it currently.

Qu 1: i've never sold a property before: would it just be as simple as just asking FD to port my existing mortgage and then borrowing the £17,000 extra at their SVR (currently 3.69%, but that's likely to rise, isn't it)?

Qu 2: I am overpaying like crazy and am convinced I can pay off exising mortgage in full by April 2014. If I then took out a completely new mortgage (of £17,000 ish) would I be classed as a FTB? (which I think would mean the interest rate charged would be less favourable)

Qu 3: What would you do in my position? My job is relatively secure and even though I'd love to move closer to friends / work (which would mean I wouldn't need a car anymore:)), I can easily hold tight for another couple of years.

I appreciate this isn't a big problem compared with others on here, but it's a real dilemna for me! Help!

rising_from_the_ashes

patrick_bs15 wrote: »

Qu 1: i've never sold a property before: would it just be as simple as just asking FD to port my existing mortgage and then borrowing the £17,000 extra at their SVR (currently 3.69%, but that's likely to rise, isn't it)?

It depends on whether your current mortgage is portable or not?

patrick_bs15 wrote: »

Qu 2: I am overpaying like crazy and am convinced I can pay off exising mortgage in full by April 2014. If I then took out a completely new mortgage (of £17,000 ish) would I be classed as a FTB? (which I think would mean the interest rate charged would be less favourable)

No you're only a FTB once ..... even if there is a gap between properties, you'd not be able to be considered as such.

patrick_bs15 wrote: »

Qu 3: What would you do in my position? My job is relatively secure and even though I'd love to move closer to friends / work (which would mean I wouldn't need a car anymore:)), I can easily hold tight for another couple of years.

Personal decision..... if it were me, I'd be tempted to stay put, enjoy not having a mortgage and, if you can manage to pay back £21k in 2 years then you could easily save that over the next 2 years and then buy somewhere you want outright ... but that's only me!

patrick_bs15

Thanks - what you say makes sense and I am inclined to stay put (my mortgage is definitely portable though).
I think I'm going to let my head rule over my heart...

patrick_bs15

...I'd still welcome other opinions though!

mrcow

I'd stay put and keep paying off until you find somewhere you really like. Buying a property can cost a lot of money in fees etc. Make it a move worth doing.

And don't buy a flat - get a house. They are geenerally much nicer to live in, retain their value better and have more potential development wise.

patrick_bs15

mrcow - thanks for your input and i agree that a house is a better investment... however, I work full-time at the moment (as a primary school teacher) and I would love to be in a position to go part-time (3 days a week) in 4 / 5 years from now - that's why I want another flat.

hcb42

re question 2, you would find it near impossible to get a new mortgage of £17K, I am sure they have minimum loans which are higher than that, have a play around with the mortgage calculators and comparison sites.

patrick_bs15

Thabks hcb42
I wonder what the lowest amount I could borrow would be? (I expect £25,000) Will have a look at the comparison sites now.

I agree that I'm probably better off staying put for now - I keep looking at Rightmove though. There's nothing wrong with a bit of window-shopping...

[Deleted User]

I think the fact that you're window shopping means in the back of your mind you're ready to move up the property ladder and move to a more convenient area.

If it was me I would take advantage of the low property prices and low interest rates now and buy a two bedroom flat, install a lodger and carry on overpaying using the lodger's rent money.

Thrugelmir

patrick_bs15 wrote: »

T(my mortgage is definitely portable though).
..

Lender sets the terms. So never definately.

getmore4less

hcb42 wrote: »

re question 2, you would find it near impossible to get a new mortgage of £17K, I am sure they have minimum loans which are higher than that, have a play around with the mortgage calculators and comparison sites.

FD do £10k, £30k for offsets

They used to say this on the deals summary but it seems to have gone.