FTB conundrum

MeltingSugs

ViolaLass wrote: »

You think after a couple of years you would need a house that is just 15% more expensive? What is that 15% giving you?

(We'll buy again this year, I hope, and the increase in value will be well over 100%)

To be fair, we moved 21 months after buying our first house, the value difference was 15% based on sold prices at the time (bought our first house for £210k, sold it for £260k, bought next house at £310k). We went from a 2 bed semi, moving 30 miles north, and slightly further from the London commuter belt, and now have a 4 bed semi detached period cottage. It is just my husband and I, no kids, but theoretically we wont need to move if we have some unless we want to.

juniordoc

Could you ask to end your tenancy early by mutual consent, say in March, and move in with the parents early to save a couple of months rent?
If I were you I would do everything I could to get to 90%LTV so be really frugal this spring.

katebl

Why would you think you have the right to force your partner to buy a more expensive house than they are comfortable with when they are the ones with the money upfront? If prices fall, that's their money at risk, not yours. Seems very unfair.

I'd definitely look to boost your savings to the 10% deposit mark before focusing on the credit card (as long as the 0% period allows) - the saving on the mortgage interest will be noticeable

exiled_red

Definitely get the deposit high enough to get over the 10% deposit value, the difference between 2.5% and 4% interest is huge

ThePants999

Personally, I'm in the camp of stretching as far as you can. Moving is INCREDIBLY expensive, and if you can endure some initial belt tightening/hardship in order to do it once instead of twice, you're probably much better off in the long run. ("Probably", because stretching is obviously a risk, so it might all go horribly wrong.)

However, I do suspect you may have overestimated what you can get, unless you wait a few months until that debt is gone.

2ndAccount

Thanks all for the further replies.

To pick up on the highlights, the extra 15% would be the difference between a 2 bed or 3 bed; hence needing to upsize in a couple of years or not.

To the comment about ‘forcing’ this on my partner; it would be a decision we take together, she’s just naturally more frugal and cautious with money (hence her having the saving and me not!!) and I was looking for opinions if pushing for the more expensive house was reckless or not.

Interesting to see there are arguments for both sides of the coin about stretching now or not. My thoughts about the ‘cost of moving’ are one of the reasons I thought it best in the long run to stretch now.

Please bear in mind also to all the points about the c/c debt; it’s £7500 now and dropping at £900 per month. By May it’ll be £3000 at that rate, hopefully more appeasing to the lenders.

IFA tomorrow, he’ll give us his opinion, and I’ll update the thread then.

Once again thanks for comments and thoughts to date.

2ndAccount

Just an update, following the meeting with our IFA we began searching with a buying budget of £300k (including deposit) based on his initial advice.

Today, the IFA has got us a DIP with Halifax to lend up to £304,000 based on a 10% deposit (purchase price circa £335k).

We’ve got a second viewing on the 7th house we looked at all booked in, it’s all very exciting!
This is not at the top of our buying power but close to, and was the only home that gave us ‘that feeling’ when we viewed it first.

For anyone else viewing this, Halifax seem hungry for FTB’s (according to our IFA) and will lend on big multiples.

Also, they didn’t take into consideration the bar work as it’s a zero hours contract, and they weren’t fussed about the £7500 of debt left over.

Socajam

Credit Card debt £7,500 all on interest free, dropping at circa £900 p/m

My two cents, get rid of this debt if you can before buying, you will have a lot more disposable income.
It's much better/easier all around to become a homeowner debt free, except the mortgage.