wanna be mortgage free before even getting a mortgage lol

chloe87

right, we are waiting for a broker to get back to us about mortgage offers, but in the mean time we have been looking at house, the one we are interested is on the market at offers between 55k-60k we are looking at getting a 95% mortgage, if the mortgage we are offered only allows 10% overpayment and we go over this by say 50% what chargers are we looking at? we want to overpay every month and get the house paid off within 7 years, not to mention the 30oddk we would save in interest, but we may want to move in this time so would like as much equity in the property as possible,

so would we be (text removed by MSE Forum Team) by over paying 50% over the over payment allowance and does anyone know by how much?

just thinking ahead for the future

lea_t88

It depends on the lender and type of mortgage you decide to go with re overpayments and charges.

Mine only allows 10% overpayment but that is within the 2 years fixed period. To overpay during this 2 years would cause a repayment fee.
After the 2 years I *think* I can overpay what I like with no fees.

pavlovs_dog

assuming you haven't missed a one out, and you are looking to buy a house for 55-65k (not £155 - 165k), have you considered whether you might be better off renting and saving as much as possible for a bigger deposit? With a better loan to value, you'd have access to a much wider range of the mortgage market, and therefore better deals. If you can afford to OP £7-8k a year as your post suggests, saving this for two years would give you circa 20% deposit on a house that costs 65k.

I'd also question your logic in wanting to buy a house, only to then have to move within as little as 7 years. The costs associated with moving are not to be sniffed at. You'd make a decent saving by making sure your first house is the best that you can afford, and preferably something that you can grow in to rather than outgrow too soon.

quicklee99

You need to clarify if that's 10% of the balance per year i.e. 5/6K in first year or if that's a 10% overpayment of your monthly payment as there will be a big difference.

Also once you go over your 10% there maybe a ERC applicable which may be so high that it's counter productive to exceed it.

chloe87

we cant rent because of our dogs so this is the only option we have, if we stay where we are we will have to get rid of most of our dogs and they are part of the family, we have only been told this in the past few days so have needed to act fast and tack what we can, the broker will be ringing back tomorrow to tell us what he has come up with