selling after 2 years

jerome1

hi,

i am looking to sell my house after 2 years of purchase and will be at the end of the 2 year fixed rate mortgage. the house was 160k with 26k deposit over 35 years and 2 year fixed rate mortgage of around 4.5%. am i gonna lose a lot?

help here would be highly appreciated as i have used the amortization calculators and not sure if they work for this?

thanks

jerry

anselld

What do you mean "lose"?

Selling price less purchase price less fees. What has the mortgage got to do with it?

jerome1

basically ive been told if i sell at the end of the 2 year fixed rate for the same amount as i bought the house i will lose all my deposit?

TrickyDicky101

The cash you will realise from the sale will be

Selling Price less Outstanding Mortgage less Fees

If you sell for what you bought it for, your mortgage will be a little bit smaller than what you originally borrowed (as most of your payments in the first 2 years, especially over a 35 year term, will be interest rather than capital) and fees will be around £3.5k (complete guess here - I have no idea what your individual EA and conveyancing costs will be).

In the above scenario, you would end up with probably a slightly smaller deposit than you started with.

However, this would rely on you actually getting what you paid for the property 2 years ago (how realistically achievable is this?). This wasn't a new build at the time was it?

jerome1

no not a new build. got the house for a good price and also done a little work on it so im hoping for very close to purchase price.

just want to make sure there is most of the original deposit left over after selling and obviously fees involved...

i was told that i wouldnt have much left if i sold after 2 years

TrickyDicky101

Well, don't forget if you do intend to buy somewhere else then there will be fees to pay on the purchase and potentially stamp duty plus moving costs. All of these will reduce the money you have available to use as deposit on the next place.

R_P_W

Who has told you all this?

If you cant sell your house for as much as you paid for it then obviously you will get less out than you put in. If you sell it for £20k less than you paid and you had put in £20k deposit then after fees you will basically start at zero.

jerome1

moving back home so just need to sell.

ive worked out that at the end of the first 2 years my remaining balance would be around 131k if i was to sell. so if i sold for 160k i would have 29k back? and obviously less the costs etc...?

thelem

I can't see how you would spend £26k+ in selling and moving fees - £3-4k is much more likely.

The big if is selling your house for £160k - it could easily have lost £26k in value over the last two years depending on where you live. Remember estate agent valuations will likely be optimistic, and most people don't sell for the asking price.

thelem

jerome1 wrote: »

my remaining balance would be around 131k if i was to sell. so if i sold for 160k i would have 29k back? and obviously less the costs etc...?

Yes, that's correct.

G_M

Look - until you know what you can sell for, this is all just hot air!

* ask 3 estate agents round to give you realistic sale prices
* use zoopla or similar to search for similar local properties and see what they sold for recently

That will give you an idea how much you can sell for.

Then you can calculate the additional sales costs (estate agents, solicitor etc), and deduct your outstanding mortgage, and... bingo! Find out how much might be left over in your pocket!