Mortgage in principle agreed while I have nowhere to live + Brexit. Confused.

Borealis

Hi folks,

I'm looking for a bit of advice. My situation is this:

I was renting a flat which got sold so I had to move out. To cut a long story short, I wasn't able to find anywhere to move to (southwest England). I'm still really struggling to find accommodation and I'm currently sleeping on my cousin's sofa. I'm not really sure how long I'm welcome for and I really don't want to be !!!!!!!!!!, especially as I have no firm move-out date. I'm still looking for flats and houseshares, but there's precious little available and I'm having little luck - slim pickings out there.

On the plus side, I've recently been offered a mortgage in principle from a mainstream lender via my mortgage adviser. I'm a first-time buyer and I've got my eye on some shared ownership new builds in the area and will be viewing them soon.

I'm feeling quite overwhelmed and extremely stressed at the moment (not exclusively related to my housing situation). I can't stay with my cousin indefinitely (more her flatmate than my cousin - I'm paying them rent and being a generally good guest), though I think they'd be happy if I could give them a firm move-out date. However, going into a new tenancy will lock me into a minimum of a six-month contract, and I don't want to miss out on properties given how extraordinarily competitive housing is around here.

Then there's the old chestnut of Brexit coming up in March (which would be within my six-month tenancy period), and goodness knows what's going to happen then. If house prices are likely to go up then I want to get a move on and purchase now. If they go down then I want to delay a bit so I can buy when they're cheaper (I know prices would eventually recover and the house would be my long-term home so it doesn't matter if there's a bit of a dip, but if I can avoid spending £££ extra then I will).

My credit score isn't spectacular thanks to a (now-satisfied) CCJ I received a year ago (not entirely my fault, but it's done now). I say this because I'm aware that I'm not exactly the perfect applicant and getting a mortgage agreed in principle has been fantastic news. Should things go south economically I'm fairly confident that offer would be rescinded if lenders tighten up on lending.

I'm really not sure what to do. I have no idea what the time scales of purchasing are likely to be and I really don't want to jeopardise my good relationship with my cousin by overstaying my welcome. Similarly, I don't want to have myself locked into a lengthy tenancy and then miss out on purchasing. At this stage actually getting a tenancy would be an achievement because I'm really struggling to find somewhere.

Any and all advice is greatly appreciated! I'm new to this and find financial stuff very confusing at the best of times...

Borealis

Browntoa

Prices : - nobody knows

Brexit :- nobody knows

It's a place to live rather than an investment but normally in the long term you should make equity

saajan_12

Borealis wrote: »

Hi folks,

I'm looking for a bit of advice. My situation is this:

I was renting a flat which got sold so I had to move out. - are you sure? The house ownership doesn't directly have anything to do with you.. if your tenancy continued then the new owner would simply become your LL. Did your LL actually serve you Section 21 notice, then get a court possession order, then get bailiffs? Before all that you didn't HAVE to mvoe. To cut a long story short, I wasn't able to find anywhere to move to (southwest England). I'm still really struggling to find accommodation and I'm currently sleeping on my cousin's sofa. I'm not really sure how long I'm welcome for and I really don't want to be !!!!!!!!!!, especially as I have no firm move-out date. - friendships can be strained when one side feels taken advantage of.. Your cousin sounds v nice providing you with somewhere to stay, I wouldn't risk that.. if nothing else, you might need it again in the future. I'm still looking for flats and houseshares, but there's precious little available and I'm having little luck - slim pickings out there. - what are you discarding: eg are they too expensive / small / bad area / require stringent references..? Maybe you can lower your sights a little and look for a live in landlord or house share, which are often more flexible with contract lengths.. that way you have something sooner and can get out of your cousin's hair while you look for something long term.

On the plus side, I've recently been offered a mortgage in principle from a mainstream lender via my mortgage adviser. - a MIP is very tentative.. they base it on what you tell them without really doing their own checks so won't necessarily turn into a firm offer. I wouldn't put much weight on a MIP. Also, don't just go by the fact its from a mainstream lender.. doesn't mean 'less mainstream' ones will be more flexible. I'm a first-time buyer and I've got my eye on some shared ownership new builds in the area and will be viewing them soon. - so you have a long way to go! Viewings are jsut the start, you need a lender who does Shared Ownership. Plus, need to choose a property, make an offer, have it accepted, get surveys & searches, go through the lease + rent terms, get full mortgage offer, get deposit and fees together, agree exchange, complete.. Typically anywhere from 4-10 months!

I'm feeling quite overwhelmed and extremely stressed at the moment (not exclusively related to my housing situation). I can't stay with my cousin indefinitely (more her flatmate than my cousin - I'm paying them rent and being a generally good guest), though I think they'd be happy if I could give them a firm move-out date. - So simplify things and don't try to do everything at once. Move out so the social stress is gone. When you're settled in a short term rental and less stressed, then you can take your time looking for a house to buy. However, going into a new tenancy will lock me into a minimum of a six-month contract, and I don't want to miss out on properties given how extraordinarily competitive housing is around here. - 6 months is nothing, if you havent even viewed yet then it'll likely take that long or more before you're ready to move in. You could take a 6 month contract and go rolling after that, so you can leave with 1 period notice.

Then there's the old chestnut of Brexit coming up in March (which would be within my six-month tenancy period), and goodness knows what's going to happen then. If house prices are likely to go up then I want to get a move on and purchase now. If they go down then I want to delay a bit so I can buy when they're cheaper (I know prices would eventually recover and the house would be my long-term home so it doesn't matter if there's a bit of a dip, but if I can avoid spending £££ extra then I will). - of course, everyone wants to buy on the low, but without a crystal ball, who knows.. I'd think in the short term Brexit would bring some uncertainty so prices go down in the short term atleast but that seems to be the widespread view so in theory shoudl be priced in already ie already lowered to account for that.)

My credit score isn't spectacular thanks to a (now-satisfied) CCJ I received a year ago (not entirely my fault, but it's done now). I say this because I'm aware that I'm not exactly the perfect applicant and getting a mortgage agreed in principle has been fantastic news. Should things go south economically I'm fairly confident that offer would be rescinded if lenders tighten up on lending. - did the lender know about the CCJ though? for a DIP, they don't always check so rely on what you declare.. no point in under-declaring, as it would all be found by the time you make a full application.

I'm really not sure what to do. I have no idea what the time scales of purchasing - several months are likely to be and I really don't want to jeopardise my good relationship with my cousin by overstaying my welcome. Similarly, I don't want to have myself locked into a lengthy tenancy and then miss out on purchasing. - at worst you'd have rent + mortgage for a month or two.. you could delay completion if needed. But its far more likely it will take well over 6 months. At this stage actually getting a tenancy would be an achievement because I'm really struggling to find somewhere. - lower your sights? look for a lodging instead>

Any and all advice is greatly appreciated! I'm new to this and find financial stuff very confusing at the best of times...

Borealis

Buying: you haven't even viewed yet, and a MIP is very tentative. You have months to go for this. Just rent somewhere and go periodic after the initial fixed term.

Renting: If its going to be temporary, maybe look for something cheaper / worse area / smaller.. also a house share or live in landlord can be more flexible.

Throwaway1

I know 6 months sounds like ages but it's not in terms of buying. We're buying chain free and we're now into our 4th month. I reckon 6 months is probably the perfect amout of time to allow you a month or so to find something rather than having to rush and then the time it takes for all the searches/enquiries to be sorted and then you could always have an overlap for the final month so you can move all your stuff (and that's if everything goes along without a hitch).

Thrugelmir

Borealis wrote: »

Then there's the old chestnut of Brexit coming up in March

None of the Brexit negotiations directly relate to the UK housing market. People will still need somewhere to live. Demand for housing depends on many factors.

Crashy_Time

Thrugelmir wrote: »

None of the Brexit negotiations directly relate to the UK housing market. People will still need somewhere to live. Demand for housing depends on many factors.

That`s right, sales transactions are plummeting anyway, and rents are also falling I believe.

jonnygee2

To cut a long story short, I wasn't able to find anywhere to move to (southwest England). I'm still really struggling to find accommodation and I'm currently sleeping on my cousin's sofa. I'm not really sure how long I'm welcome for and I really don't want to be !!!!!!!!!!, especially as I have no firm move-out date.

Buying is quite a long process, whereas you have an immediate need for housing. You are most likely going to have to find suitable short term accommodation as a first step. Perhaps look for lodger arrangements as they are more flexible with shorter notice, which is generally useful when you are looking to buy.

Then there's the old chestnut of Brexit coming up in March

In many ways its a good time to buy. Sales are slow, sellers are desperate so you are likely to get the house you want at a good price, and the buying process will be much easier. Interest rates are low and banks are lending very easily.

Once you have a mortgage you can afford and a house you can live in for a long time, you don't need to worry about house prices too much.

tlc678910

Hi, Do you, your cousin or a friend work somewhere where you could stick on a notice board a room wanted advert or email one?
You could explain you would like to rent a room temporarily while you house hunt and someone who doesn't normally have a lodger might be willing to give it a go for a friend of a friend.
Tlc

Crashy_Time

jonnygee2 wrote: »

Buying is quite a long process, whereas you have an immediate need for housing. You are most likely going to have to find suitable short term accommodation as a first step. Perhaps look for lodger arrangements as they are more flexible with shorter notice, which is generally useful when you are looking to buy.



In many ways its a good time to buy. Sales are slow, sellers are desperate so you are likely to get the house you want at a good price, and the buying process will be much easier. Interest rates are low and banks are lending very easily.

Once you have a mortgage you can afford and a house you can live in for a long time, you don't need to worry about house prices too much.

Unless prices crash and interest rates go up? Most people will worry in that situation, especially people who bought 600k London shoe-boxes and the like?

Comms69

Crashy_Time wrote: »

That`s right, sales transactions are plummeting anyway, and rents are also falling I believe.

Source it.

Crashy_Time

Comms69 wrote: »

Source it.

https://www.independent.co.uk/news/business/news/uk-house-prices-property-market-growth-sales-drop-england-wales-latest-a8590626.html


https://www.theguardian.com/money/2018/oct/16/taxes-buy-to-let-landlords-rents-generation-rent-buyers