Borrowing to Fund a Mortgage Deposit

Arleen

Why would it take 2 years to save if, as you claim, you have spare 2.5k every month? 20k/2.5=8. If you don't have that to spend at end of each month, you may want to recalculate your finances from scratch.

Money_Rollercoaster

It looks like you'll probably need a buy to let mortgage, so I hope you'll be doing your sums on that.

You could, conceivably, release some equity from your existing property and use that to pump prime your venture? This certainly sounds more advisable than the whole loan idea ...


http://www.gocompare.com/mortgages/borrowing-a-deposit/

sheff6107

Or get a loan, buy a car with it and sell the car the next day. Hopefully not making a loss!

Nasqueron

richieboy wrote: »

Nasqueron...Thanks for the post... Although in reality it would take nearer 2 years to save, and it could be argued that in that time the property could have went up in value and will require more deposit and more mortgage...anyway its still a valid point. 80K mortgage paying off in 3 years is maybe a bit extreme but again I get your point thanks again.

I could only go on your figure of saying "£2700 a month after bills" - I stretched it to a year to allow some spending on fun stuff rather than expecting you to use all your cash on it but it's still only ~ £1666 a month over the course of a year leaving £1000 a month for entertainment etc to save up 20k. Taking 2 years to save it would be around £830 a month - if you really have £2700 a month free then where is it all going if you can't save that much i.e. £1900 a month is just vanishing?

Obviously 3 years is a bit silly but again £2700 a month free cash would be easily done - if you paid it off over 5 years on fixed rate you'd be laughing

I suspect if you sat down and looked at your sums you could save yourself a lot of money and realise how much is going on unnecessary expenditure