first time buyer looking for advice

TheSenSibleOne

Just found out about the hsbc fee free discount mortgage. This seems like a much better option as they may still lend us over £100,000 but the mortgage will last only 30 years.

What do you guys think?

P.S Are banks quite tight to who they lend to? As in do they prefer lending to customers with current accounts/ savings accounts?

ACG

HSBC/First Direct - appear to have the strictest criteria - read these forums.
I dont think many lenders use Libor - i know some have in the past, i cant think of any that do but im sure there will be the odd one.

Personally, i dont think its an issue lending over 30+ years. If it helped me to get the house i wanted, id only be prepared to do it if i were confident i could overpay and/or afford it with increased rates and was confident my wage would be going up so at renewal date i could afford to reduce the term or pay off a chunk - but everyone has their own opinions and it definately isnt for everyone.

Some banks offer deals exclusive to current account holders - but i wouldnt let that affect our decision too much on who to go with. It wont make any difference at underwriting stage.

TheSenSibleOne

ACG wrote: »

HSBC/First Direct - appear to have the strictest criteria - read these forums.
I dont think many lenders use Libor - i know some have in the past, i cant think of any that do but im sure there will be the odd one.

Personally, i dont think its an issue lending over 30+ years. If it helped me to get the house i wanted, id only be prepared to do it if i were confident i could overpay and/or afford it with increased rates and was confident my wage would be going up so at renewal date i could afford to reduce the term or pay off a chunk - but everyone has their own opinions and it definately isnt for everyone.

Some banks offer deals exclusive to current account holders - but i wouldnt let that affect our decision too much on who to go with. It wont make any difference at underwriting stage.

We have a really good credit rating, fingers crossed when we come to it we shouldn't have too many problems with it.

When are mortgages up for renewal? Is it after the fixed rate expires?

We would easily be able to overpay considerably, but I believe the max is an extra 20% per month though some banks do vary?

That opens up my options a bit more, I was being way too linear in selecting a lender (have only looked at halifax)

Thanks again ACG

kidmugsy

"We are currently paying rent which is around the same as we would be paying for the mortgage". I dare say, but remember it's you who'll have to pay for the new roof and so on. I suggest you save like billy-oh and hope that house prices fall.

Thrugelmir

TheSenSibleOne wrote: »

do you mean income decreasing?

We are currently paying rent which is around the same as we would be paying for the mortgage

Rising interest rates will have the effect of decreasing income. An addition to the family likewise. Given these uncertain economic times I wouldn't bank on inflation busting pay rises for the foreseeable future (obviously there will some exceptions). So I merely suggesting a cautious approach.

Home ownership comes at a cost. Property requires maintenance. Over time boilers, doubling glazing, kitchens, bathrooms will need replacing. So don't fall into the trap of believing that a mortgage = rent. Ownership does bring longer term benefits. As once mortgage free life certainly becomes a lot less stressful.