Advice on Affordability

Nelly321

Just to set the scene...

First Time Buyers

Offering £130k for a house up for £135k (1950's Semi)

Current Wages: £31,500 & £16,500

15% Deposit Ready (£19,500)

Looking at 5 year fixed rate (85% LTV) @ 4.49% 25 year term = £615PCM

Given the current housing situation would you say this is a sensible move?

Thanks

ch3101

Yes, if I were you I'd look to over pay a lot given you have >3000 a month.

Obviously you might keep finances split so it wouldn't work like that but certainly something to consider?

Nelly321

Indeed overpaying is an option.

I have tried to be realistic and I have based my monthly spending numbers on a worst case basis. Which still leaves £300-400 left between us after all outgoings and some into savings.

amnblog

Why take a 5 year fixed on a mortgage you should be able to get down to 80% or 75% loan to value very quickly?

Perhaps you could take a 2 year rate. Overpay heavily and review in 2015.

Nelly321

Thanks amnblog!

Seems a good idea too! Would save me from a higher interest rate too!