First time buyer - help! im a novice!

falldown7timesgetup8

Hi everyone,

I would HUGELY appreciate any help!
I am ALMOST debt free, and I am about to start saving HARD for a house deposit. I guess my questions would be
1) How much deposit will i need as a minimum?
2) Id like to buy a house at value 180 - 200k - is this
possible?
3) If not, what COULD I get?
4) How much would this make my mortgage payment each month?

I know a lot of this might be a bit of an estimate, but it would be helpful to know roughly what im aiming for?

I am 29 years old, in a full time very steady job, and have a good credit rating, earning a salary of approx 37k.
Any questions, please feel free to ask.

thank you very much x

Nynaeve

It's going to take some time to get your deposit together so might not be worth visiting this question for a while yet - by the time you have saved things may well have changed.

My husband earns roughly the same as you and we were able to get a 90% mortgage on a £140k house last June. (My salary couldn't be included as I was a temporary worker at the time)

For a 180K house you will need a MUCH larger deposit.

caz_cardiff87

have you tried using any of the house deposit or mortgage calculators available on the web? They will be able to give you a good estimate on what sort of figures you need to aim for.

I’m no expert but i would guess the minimum deposit varies greatly from lender to lender but having spoken to my dad (i’m 25, no where near buying a house lol) the bigger deposit you can get together now, the lesser your monthly payments will be as you will be paying a larger percentage off the value of the house straight off.

I would work backwards and figure out what you can afford to pay each month and over how many years you wish to pay for, mark that up against the price of the house and see what figure is left.... obviously you need to take into account interest rates etc

I read an article not too long ago that says the minimum deposit now is around 30,000 and can take anything from 10 - 15 years to save... but obviously that all depends on how much your saving every month.

Give this a bash and see what you get

http://www.moneysupermarket.com/mortgages/calculator/

falldown7timesgetup8

Hi Nynaeve,

Thank you for replying, thats very kind and helpful - im very frugal with my money, so i will be saving approximately £1200 towards the house deposit each month, plus money given as gifts etc will also go towards it, as will any salary increases. I was thinking I might be able to get somewhere in the region of £25,000 saved by the end of 2014? Is that along the lines of the "much larger" amount I would need do you think?
Im just after a ballpark really, just in case the plan of meeting a very rich man doesnt pan out......

Nynaeve

We started by going to the mortgage advice bureau. We had no intention of organising our mortgage through them, we just wanted answers to the sort of questions you are asking. How much could I borrow? How much do I need to save etc. We got a mortgage that wasn't offered through the MAB in the end.

ACG

1) How much deposit will i need as a minimum?
You may get away with 5%, but i would say minimum 10% of the purchase price as a minimum.
2) Id like to buy a house at value 180 - 200k - is this
possible?
I would say £163k is more realistic - 4x your income plus your deposit.

3) If not, what COULD I get? As above.

4) How much would this make my mortgage payment each month?
Depends on the deal and over how many years, but presuming its 5% interest rate over 25 years it would be around £875 per month.

falldown7timesgetup8

Thanks Caz, That mortgage calculator was really helpful!!!
ACG - VERY helpful - Can i ask - If 4 x my salary was 160k (It should actually go up shortly to £40k, i should have mentioned that, sorry)....and then I saved £20-25k deposit...would that get me the 180k? (house prices are high where I am)

ACG

It would, 4x 40,000 = 160,000 plus the £20k makes £180,000.

Those are just basic figures and dont take into account any debts or credit etc but it gives an idea.

Nynaeve

It's going to depend on the market at the time you're buying but don't forget houses don't usually go for their asking price (we got 10k off ours)

falldown7timesgetup8

Absolutely, thats great, gives me a rough idea what I am aiming for!
I have nearly paid off all debt, so i will be totally debt free (including student loan) when it comes to applying for the mortgage, although i will have credit available to me (approx 9k available credit on cards/od at the moment)....some time down the road, would it be advisable to close these? I believe im 2 years from having the deposit together, so I want to look ahead and set myself up on a good path sooner rather than later, so im sorry for endless/stupid questions....

falldown7timesgetup8

Oh Nynaeve, thats a really good point, would make it a little easier if there was 10k flex - most house prices round here are 180/190k.....
Kill me!!