Planning to move house best way to save towards the deposit

douglasfunny

Hi All

I'm currently living a in a small flat which I bought for 38k around two years ago. I my mortgage was 32k with a 6k deposit. I'm hoping to move to a new house worth around 100k in a year or so.

I realise in order to do this I will need at least 10k deposit which I haven't yet paid towards my current mortage. I was wondering if it better to save 3-4k to make up the difference or should I pay say 3-4k into my current mortgage over the next year?

Hope that all makes sense

kidmugsy

What's the current interest rate on your mortgage?

R_P_W

If it was me over such a short timescale I would just save it as cash rather than overpaying the mortgage.

From what you have said looks like you are assuming you will be able to sell your flat and get out your £6k deposit? You need to be prepared that this may not happen. It may be valued at lower than what you paid.

Remember you will also need to save extra to cover buying and selling fees.

douglasfunny

Sorry Forgot to mention my Interest is 4%. I'll hopefully recieve the money back that I bought it for as I got it 2k less than the market value price and have modernized the flat.

Thrugelmir

Will you be able to obtain a 90% mortgage?

If not. Overpay your mortgage first.

douglasfunny

Yes hopefully I'll be accepted for a 90% mortgage, when I purchased my current flat the advisor told that nationwide were prepared to lend me up to 130k on a 10% deposit.

I realse things may have changed in the last 2 year

Thrugelmir

Much has changed in the past 3 months. Let alone 2 years.

90% LTV will require a squeaky clean credit record.