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First time buyer - how much will I need?
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bp5678
Posts: 413 Forumite

I have 2 questions:
1) How much money will I need to have saved?
2) When do you think I will realistically have the money?
To give you some background, I have £2600 in my Help To Buy ISA and I'm adding £200 into it per month.
I have £8500 in my current account. I am averaging saving £850 a month.
I also have a Lifetime ISA. When I come to buying my first home, I will move the majority of my money from my current account as well as that in my Help To Buy ISA over into the Lifetime ISA.
My credit score is pretty good.
I would like to take out a 10% mortgage.
I expect the home I move into to be in the region of £300,000.
EDIT: I'm only earning £28k however I live very frugally. Would I be able to get a mortgage based on this salary do you think?
So regarding my 2 questions:
1) How much money will I need to have saved?
2) When do you think I will realistically have enough money to meet question 1?
1) How much money will I need to have saved?
2) When do you think I will realistically have the money?
To give you some background, I have £2600 in my Help To Buy ISA and I'm adding £200 into it per month.
I have £8500 in my current account. I am averaging saving £850 a month.
I also have a Lifetime ISA. When I come to buying my first home, I will move the majority of my money from my current account as well as that in my Help To Buy ISA over into the Lifetime ISA.
My credit score is pretty good.
I would like to take out a 10% mortgage.
I expect the home I move into to be in the region of £300,000.
EDIT: I'm only earning £28k however I live very frugally. Would I be able to get a mortgage based on this salary do you think?
So regarding my 2 questions:
1) How much money will I need to have saved?
2) When do you think I will realistically have enough money to meet question 1?
0
Comments
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To a certain extent it depends on how much you earn - basically you need to save the difference between the amount the bank will lend you and the purchase price of the property, plus stamp duty and other fees.0
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I think you probably mean a 90% mortgage, using a 10% deposit.
A mortgage of 10% of the property value, that is gonna to take you a while!
Assuming that is correct, you'll need:
Deposit: £30,000
Legal Fees: £1000-1500 (approx)
Your purchase won't attract stamp duty as you're a FTB.
Presumably you don't have a large amount of furniture to move, so removal expenses aren't something to worry about.
You may want to put some money aside to buy furniture/household essentials, unless that is already covered.
A buffer of some sort to cover bills that come with owning a house might be wise: council tax; insurance; utilities, in the main.
It would seem sensible to have around £35,000. You've currently got £11,100. At the rate you're going it's going to take roughly another 2 years for you to be ready to buy somewhere.0 -
I would aim to save the cost of your expected deposit + another £10k. So 40k.
You should create a simple spreadsheet to track your savings and predict when you will have enough. Your finances are likely to change over the next few years (they always do) so the answer to your question will change.0 -
Presumably you don't have a large amount of furniture to move, so removal expenses aren't something to worry about.
That said, I still agree with £35,000 even once you factor removals into it...0 -
Personally, I presumed the OP is still with parents. To be saving over a grand a month pretty much means a high salary or not many outgoings.
OP, I presume you have looked into what you might be able to borrow. Without knowing your salary, it's hard for us to know if you can borrow what you want.2024 wins: *must start comping again!*0 -
I think you probably mean a 90% mortgage, using a 10% deposit.
A mortgage of 10% of the property value, that is gonna to take you a while!
Assuming that is correct, you'll need:
Deposit: £30,000
Legal Fees: £1000-1500 (approx)
Your purchase won't attract stamp duty as you're a FTB.
Presumably you don't have a large amount of furniture to move, so removal expenses aren't something to worry about.
You may want to put some money aside to buy furniture/household essentials, unless that is already covered.
A buffer of some sort to cover bills that come with owning a house might be wise: council tax; insurance; utilities, in the main.
It would seem sensible to have around £35,000. You've currently got £11,100. At the rate you're going it's going to take roughly another 2 years for you to be ready to buy somewhere.ReadingTim wrote: »To a certain extent it depends on how much you earn - basically you need to save the difference between the amount the bank will lend you and the purchase price of the property, plus stamp duty and other fees.Personally, I presumed the OP is still with parents. To be saving over a grand a month pretty much means a high salary or not many outgoings.
OP, I presume you have looked into what you might be able to borrow. Without knowing your salary, it's hard for us to know if you can borrow what you want.
I'm only earning £28k however I live very frugally. I.e I cycle to work, pay only £8 for my phone bill, rarely eat out or spend on luxury items. Would I be able to get a mortgage based on this salary do you think?
Also, I'd love to move to Cardiff and know houses are quite a bit cheaper for what you get. So I maybe able to get the same standard of house in Cardiff for say about £250,000.0 -
I'm only earning £28k however I live very frugally. I.e I cycle to work, pay only £8 for my phone bill, rarely eat out or spend on luxury items. Would I be able to get a mortgage based on this salary do you think?
Have a look here as to what you might be able to borrow with that sort of salary. You're going to be saving for a very long time I'm afraid, even living very frugally.0 -
Earnings of 28k are likely to only achieve a maximum borrowing amount of £140k plus any deposit you have savedI am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
I'm only earning £28k however I live very frugally. I.e I cycle to work, pay only £8 for my phone bill, rarely eat out or spend on luxury items. Would I be able to get a mortgage based on this salary do you think?
Also, I'd love to move to Cardiff and know houses are quite a bit cheaper for what you get. So I maybe able to get the same standard of house in Cardiff for say about £250,000.
Normally lenders will go to a max of 4.5 times salary so there’d be quite a bit of saving to do to afford a property of that price.0
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