Help - Buying my first house and worried about the future.

Watfordgirlam

Can anyone help me, or give me any advice?

I got married last year and my husband and I are about to buy our first home. In order to get on the property ladder we are doing a first time buyers scheme with Nationwide (save to buy) with a 5% deposit. Due to this the mortgage repayments are near £1,300 a month (twice our rent) for a 2 bed house, fixed for 4 years. I'm also learning to drive as neither my husband or I drive currently.

The problem I have is not affording the house with us both, but affording the house when we have a child. I've done the budgets and both myself and my husband are on medium wages and can afford our house (though after the bills and monthly food shopping (£200 a month) we have £200 a month left between us. We like our jobs and I earn more than my husband.

I've been looking into what we need to do if we have a child and looking at various budgets and It scares the crap out of me, to the point I don't sleep and worry contently! Basically, we aren't entitled to child tax credits, If I work full time we can't afford childcare and the mortgage, If I work part time we still can't afford childcare and the mortgage and I'm wondering how anyone manages to earn enough to look after everything.

I know there are others worse off than us that cope, but is that because they have no choice to get into debt. I've been in debt and I've finally got out of it and don't want to get back into debt. My husband has never had a loan or a credit card, but has also never budgeted and thinks it'll just all be ok, that having 2 children will just work and the bills will pay themselves and we'll still be able to run a car and feed and cloth our children, take them on holiday and pay the mortgage.

Every time I look a the various avenues we can't afford it!

Does anyone have any tips, suggestions or personal experiences that will ease my mind as I'm getting more and more worried!

hazyjo

Blimey, how on earth are they lending you that much?!

I am not far off my max and still have over a grand left each month. £200 spare a month won't go far!! What about winter heating bills? Dentist? Car expenses (a bloody fortune if you work it out month by month)? House maintenance? Socialising? Let alone future offspring...

£200 spare a month between two of you basically gives you around £25 each a week.

Personally, I wouldn't sleep at night. Sounds too tight to me.

Why don't you get a mortgage based on your salaries and buy something smaller, or in a cheaper area?

Jx

JennyW_2

Watfordgirlam wrote: »

My husband has never had a loan or a credit card, but has also never budgeted and thinks it'll just all be ok, that having 2 children will just work and the bills will pay themselves and we'll still be able to run a car and feed and cloth our children, take them on holiday and pay the mortgage.

you're husband thinks that you can afford the above with £200 left each month? :eek:

I would stay in rented and hold off having children until you are more financially stable.

I would never sleep at night

princessdon

You may have to delay having a child for a few years, really over pay your mortgage in the meantime and throw all you have into lowering the mortgage. Can you extend the term? Ie 30 years?

Also interest rates are low, have you factored in what would happen if they rose by even .5% in 4 years time if you have a lower income.

That said, you do just manage as parents - can't explain how, you just spend less.

JennyW_2

hazyjo wrote: »

Blimey, how on earth are they lending you that much?!

I wondered that?

hazyjo

PS What if mortgage rates go up?! :eek: (that's more of 'when' than 'if', btw)

Jx

princessdon

JennyW wrote: »

I wondered that?

Because the £200 pm spare is likely to be after what many of us consider none essentials. They said £200 pm after all bills, food etc.

I suppose many bills could be cut.

Werdnal

And what happens after the 4 years? Utilities, CT and other household bills are only going up aswell.

I can see why you are concerned!

I think you either have to hold of buying and continue to rent and save as much as you can to increase your deposit,

Continue to buy, but hold off having a family,

Or find a smaller property to buy - perhaps a 1 bed or flat for now, then move up when you have overpaid the mortgage to get yourself some financial stability.

Have you shopped around for deals and other FTB incentives, or just opted for the first one you came across.

TBH, if you are stressed over this now, I don't think this is a good plan, as you are relatively newly married and this is going to drive a huge wedge between you. What is more important - your marriage (and sanity) or buying a place now at the limit of your financial capacity and having to scrimp, save, go without and end up arguing over money all the time?

I think you need to forget about how much you can borrow, and concentrate on how much you can afford!

Remember too, that when renting, you don't have to repair the property, and your surplus £200 a month is not going to go far if your heating breaks down or roof starts to leak ...

YoungBusinessman

Think they are quoting you the absolute maximum they will lend, not the ideal affordable amount you should go for. We got told since OH wage didnt come into it we needed £1k+ surplus. Lucky for us we were at about £1,300 surplus just off me, £200 is nowhere near enough.

JennyW_2

princessdon wrote: »

Because the £200 pm spare is likely to be after what many of us consider none essentials. They said £200 pm after all bills, food etc.

I suppose many bills could be cut.

but I doubt a lender would approve an application if they knew you only had £200 left?

princessdon

JennyW wrote: »

but I doubt a lender would approve an application if they knew you only had £200 left?

Very true, I suspect there is leeway now, if they did calculators based on childcare with a dependant I suspect they are way over their affordability. Lenders don't consider the future when borrowing, that's down to the lenders.