Mortgage For Ftb?!

TDS_2

Hi everyone,

My partner and I are looking to buy a house. I know many would call us mad to buy at this time, but it'll be a home not an investment, and I won't be paying any more than 90% of asking price.


We are fortunate to have a sizable deposit of £210k to put towards it, and hope to borrow another £165k. Our joint income is in the region of £55k, and we have no debt (other than student loans). We will be seeking advice from our financial advisor, but I was hoping for some info/advice from these boards also...

1. Will we have any trouble securing a mortgage in the current climate - we're looking at 25yr repayment?

2. What are the best rates for a short term (<5yrs) fix, and set-up fee?

3. Any advice on what length of fix to go for? We were looking at 2 yr when we were house-hunting last Summer, but the fees seem to make this rather expensive. Are there always penalties for ending the mortgage before the fix is over?


Sorry for all the questions! Any help much appreciated!

JimmyTheWig

I can't see you having _any_ problems getting the mortgage you want (unless you've missed something important).

I don't think you're mad to want to buy. But bear in mind that prices may well come down and so it would probably be unwise to buy somewhere where you won't be happy to still be there in (say) 5 years time.

If you can reduce the term down fro 25 years it will save you a great deal in the long term. I always think that around 18 years is ideal but might be more than you can afford. Look at the figures and decide yourselves.

In terms of rates and fees your advisor (as long as they are "whole of market", etc) should be best placed.

I agree that the fees on 2 year fixes are rather expensive. Why not go for a 5 year?
Yes, you will always pay to leave a mortgage whilst in a deal. If you're worried about getting a fixed rate and rates going down, why not get a discount rate instead?

TDS_2

Thanks for the good advice Jimmy. The last time we spoke to our IFA was last Summer, and it appears that things have changed a lot since then, so just wanted to get things up-to-date before we start looking again.

I think you're right about the 5 yr - the 2 yr was tempting just because it seems like less of a big deal when it's your first house.