£4,200 net income per month and can't get a mortgage!

Thrugelmir

The_J wrote: »

Why are you assuming they will keep the mortgage for 35 years? You think an accountant and solicitor borrowing 2x income are going to need 35 years to pay off this mortgage? :rotfl: It'll be gone within 5 years if they have any sense.

People are wired differently. Many now think in a buy or spend now, pay later mindset. So my observation is of a general rather specific nature.

[Deleted User]

Thrugelmir wrote: »

People are wired differently. Many now think in a buy or spend now, pay later mindset. So my observation is of a general rather specific nature.

What is a mortgage, other than a means of 'having what you want now, rather than saving for it'?

It's only a 35 year mortgage whilst they are under the terms of their current loan. Doesn't stop them remortgaging in the future for 25 years or less.

I went for a 33 year mortgage so i would have some extra cash to horde before the interest rate went up. In the long term it will cost me more, but short turn it offers me some financial protection

Thrugelmir

ringo_24601 wrote: »

What is a mortgage, other than a means of 'having what you want now, rather than saving for it'?

The term is the issue. Longer term may be attractive in terms of cash outgoing every month. However will cost significantly more. The only winner is the lender.

getmore4less

ringo_24601 wrote: »

What is a mortgage, other than a means of 'having what you want now, rather than saving for it'?

Not quite,, you need somewhere to live.

Mortgage replaces rent so if the interest(rent) on the money is similar to the rent for an equivilent place then the capital part of the payments become invesment in equity.

alleycat`

getmore4less wrote: »

Not quite,, you need somewhere to live.

Mortgage replaces rent so if the interest(rent) on the money is similar to the rent for an equivilent place then the capital part of the payments become invesment in equity.

^
I was struggling to articulate this exact point so i'll just mod it up

[Deleted User]

Thrugelmir wrote: »

The term is the issue. Longer term may be attractive in terms of cash outgoing every month. However will cost significantly more. The only winner is the lender.

If the only winner was the lender, then no one would go for a longer term. If it's the difference of affording the home Vs continuing to rent, then affording the home (and accruing capital) is still a better option.

How is a 35 year term worse than 10 years renting + 25 years mortgage?

The_J

ringo_24601 wrote: »

If the only winner was the lender, then no one would go for a longer term.

How is a 35 year term worse than 10 years renting + 25 years mortgage?

Only situation is if house prices are lower in 10 years time.

"The longer you have a debt the better it is for the lender" - that is what Thrugelmir is saying and that's perfectly accurate but the mortgage term is not set in stone and can easily be bought down in the future if required. Paying a mortgage off in 5-10 years is very easy if you are motivated to do so.

As getmore4less says, you are investing in equity (property) if the interest element of your mortgage is the same as your rent. Just be aware, the value of equity can go down as well as up.

BillTrac

One question that crossed my mind, and I am not trying to tell the OP how they should spend their money, but...

You said you received a £10k rise a month ago.

So, either you have paid out for your wedding since the pay rise and then discovered 10% deposit was insufficient. Or you paid for the wedding before the pay rise in which case the additional income could generate a larger deposit.

I know you are lucky enough to receive a loan from your parents, but as others have said, if you decide to have a family, or indeed a family or other circumstances occur when you least expect them, you could be in difficulty.

Good luck with your future, OP.

[Deleted User]

Not everyone is obsessed with paying off their mortgage ASAP you know...

The_J

ringo_24601 wrote: »

Not everyone is obsessed with paying off their mortgage ASAP you know...

Of course, people like you and me, who are incredibly financially savvy and can invest in complex investment vehicles offshore will see comfortable rates of return above our mortgage interest.

But the majority of the people who inhabit this country have more important things to think about, like who to vote for in X-Factor, how terrible it is that someone put a cat in a bin, or how many friends they have on Facebook and therefore any savings they make go into ISAs or regular savings accounts with rates of interest far below their mortgage.

Debt enslaves you. If you owe someone money, you are at their beck and call. Why do you think the EU are bailing countries out rather than letting them do the right thing and default? Because it gives them untold power for decades. Ireland, Greece, Portugal, Spain and Italy are now confederates of Germany. Adolf Hitler is spinning in his grave thinking "that's all I had to do?!?!".