variable or fixed, I want to try to work out if I'm going to lose money...

jamesd

Depends on the person. I'm at the edge of affordability calculations for 165000 but lets consider 185000. With pension and 7000 a year ISA investing (the repayment method) I could handle 185000 at 6% interest only or 3.6% repayment over 25 years. Dropping both pension and ISA I could handle 10.7% interest only or 9.7% repayment before I'd be unable to sustain the payments long term. For a one year peak I could handle at least 12.4% interest only or 11.7% repayment and still meet all payments without selling any investments.

Allowing for other slack in my budget that means I can handle 185000 at the highest interest rates we saw in the last century without being unable to repay at any point.

JoeK_3

jamesd wrote: »

Depends on the person. I'm at the edge of affordability calculations for 165000 but lets consider 185000. With pension and 7000 a year ISA investing (the repayment method) I could handle 185000 at 6% interest only or 3.6% repayment over 25 years. Dropping both pension and ISA I could handle 10.7% interest only or 9.7% repayment before I'd be unable to sustain the payments long term. For a one year peak I could handle at least 12.4% interest only or 11.7% repayment and still meet all payments without selling any investments.

Allowing for other slack in my budget that means I can handle 185000 at the highest interest rates we saw in the last century without being unable to repay at any point.

You lucky sod!

JoeK

jamesd

JoeK wrote: »

You lucky sod!

A frugal lifestyle that has me sustaining spending less than half of my take-home pay over the last two years has advantages.

homer_j_3

with BOE committee voting 8-1 in favour of keeping rates the same and the 1 voting against was voting for a decrease. I am not sure what to think at the moment - I guess tossing that coin could be the future!!