I want to buy my Coucil house, do i need a loan or mortgage

smokeychang

After paying rent for 14 years iv decided to purchase my house on the right to buy scheme. With savings and discounts i would need to borrow only £25k.
Im unsure wether to get a mortgage for 10 years, or a personal loan. I plan to pay off the amount in 10 years or less.
Any advice is appreciated.

cattie1

I am sorry I am unable to help, I have sat here for ages thnking about it!
at first I thought a mortgage as you might get a better rate, but then if for any reason you couldn't pay then your house would be taken from you,, then I thought may be an unsecured loan but it will probably be very difficult to get that amount on an unsecured loan!
sorry for waffling on, my head is hurting now! I would be really interested in what people have to say on this!
ps I bet with that kind of mortgage you will be paying less than your monthly rent! excellent!

angelavdavis

It depends on the interest rates you are being offered. Usually you pay less interest on a mortgage.

smokeychang

The best loan rate iv been able to find is Tesco, Asda, 6.9%, i think i would prefer to have a loan, as it seems they dont take as much comapred to a mortgage. I dont think i would have a problem getting the unsecured loan, my bank are always trying to tempt me.
I cant imagine how much i would be paying fon a mortgage and feel quite shocked at the amounts people have to borrow for an average semi. It's quite scarey. With a loan i could pay as much off as i could possibly afford each month so hopefully i would poay it off in less than ten years. Im a complete novice with regards loans and mortgages and it will be my first debt!

Hapless_2

I think you will need to have a mortgage, you will also need to budget for buildings insurance, life insurance etc.
Your council will have details about mortgages.

In our case we wil have to go through the council mortgage because our house is on non traditional building materials (Cornish unit)

BrandNewDay

If I'm not mistaken, you can still lose your home to an unsecured loan. If you have equity in your home, and you find yourself unable to pay, then you can be made bankrupt and forced to sell your home to repay the loan.

mussgo

I bought my home around 7 years ago, I had to get a mortgage of 25,500, it took a while to find someone who would take me on (I earned 8k at the time, and 45 years old). But a Building society did as there was large equity in the house. Its a twenty year mortgage. I will have it paid in 10 if I carry on with my overpayments!

pfpf

mussgo wrote: »

I bought my home around 7 years ago, I had to get a mortgage of 25,500, it took a while to find someone who would take me on (I earned 8k at the time, and 45 years old). But a Building society did as there was large equity in the house. Its a twenty year mortgage. I will have it paid in 10 if I carry on with my overpayments!

crikey, is it because its so late? or maybe too much of the good stuff but your post has a real "feel good factor" kind of feel.

dont know why, it just made me smile.

well done.

mussgo

Thanks...... mortgage debt is now under 6000 and I have 22 (over)payments left. I still dont earn a great deal but am getting there!

I am so sad , I gaze lovingly over MS Money once a month as another payment is taken off (monthly interest is under 30 quid these days)!

But I thank those who initially refused to give me a mortgage for my paying it back....just wish I could go and show them the deeds or something on final payment day and say ...... you wuz wrong!!! :eek: