PinknSparkly's Mortgage Wannabe savings dairy

pinknsparkly · 15 May 2017 at 6:08PM

So this is a savings diary with the intention of getting my husband and I into debt (i.e. a mortgage) as soon as possible

I am currently finishing up a PhD and as such we won't be in a position to apply for a mortgage until I have been employed for at least 6 months. In addition, I am now at the fun stage of my PhD where I have no income (my bursary/stipend finished in March this year). This puts us in a position where our outgoings are more than our income. We knew this would happen and have pre-planned for it by building up a pot of savings to get us through this.

My aim therefore, is to use up the minimum possible amount of savings to get us through until I am employed and to then save as much as possible towards a house deposit.

I estimate that each month we will need to use around £250 - £300 from our savings to cover the short-full in our income.

Current savings: ..............................................................£38,000

Property value: ..............................................................£275,000
Stamp duty: .......................................................................£3,750
Other house purchasing expenses: ......................................£2,250
(assuming £1000 legal fees and £1,250 for everything else)

House deposit:..................................................................£32,000
(total savings minus house purchase costs)
LTV:......................................................................................88%

As you can see, we're already in the excellent position of having a 10% deposit. However, since we will have a minimum of 6 months of two full time incomes before we can get a mortgage, I hope to be able to get us up to a minimum of a 15% deposit by the time we apply. This is a very ambitious target of saving £10,000 in six months (plus whatever we've spent from our savings in the meantime), but what's the point in aiming low, right??

What do you guys think of the plan? Do my estimates for house purchasing-related costs seem reasonable?

In the meantime, I'm doing my best to get back to meal planning and making lunches to reduce our expenses as much as possible. The car is also being used as infrequently as possible to save on petrol (I'm mostly working from home at the moment). We've minimised how much we spend out and about (though my husband still ends up getting food out of the house probably once a week or so). We've also planned for no "proper" holidays this year (other than a week camping in South Wales). I'm going to a conference abroad which will be paid for, so that will satisfy my inner travel bug and my husband is quite happy spending his time off at home.

Skint_yet_Again · 15 May 2017 at 7:37PM

Hi PinknSparkly just popping in to say sorry I cant help with the house purchasing costs as I bought my last property in 1998, however I look forward to reading your diary and seeing how you get on. I am on a tight budget too so its good to share any moneysaving tips.

Good luck !

savingwannabe · 15 May 2017 at 8:33PM

Hello welcome, I hope you keep doing well and will be happy to watch you. I am sure the house purchasing costs were more than that? But can't remember the exact figures now but they were much more. I just remember the mortgage amount.

I am so glad you posted as we all help each other along. :beer:

pinknsparkly · 16 May 2017 at 12:37PM

Hi SkintYetAgain

Any and all money saving tips would be extremely welcome! Hopefully we can help and cheer each other along :beer:

Savingwannabe, thanks so much for stopping by and for the welcome. The house purchase costs were complete estimates and (very vaguely) based on the following (from this MSE article http://www.moneysavingexpert.com/mortgages/mortgage-fees-stamp-duty):

- solicitor fee:............ £1000
- valuation fee:........... £300
- conveyancing fees:.... £500
- land registry fee:.......£300

Which is a total of £2,100 - I then rounded it up a little to £2,250 to make that plus the stamp duty a nice round £6,000.

I have ignored any mortgage arrangement fees - depending on where we are at in terms of the deposit we will either pay it upfront or (if our deposit is only just enough to get us say an 85% mortgage instead of a 90% mortgage) then we'll add the arrangement fee to the mortgage and then overpay as fast as possible. We would go for a mortgage that had some sort of flexibility in terms of allowing overpayments with the intention of throwing as much spare money as we can at it.

We currently live in the property we will be buying and so I've not factored in any moving costs.

I'll have a bit more of a search later on and see if I can find any more info. We do live in Surrey, so perhaps the solicitor fees will be rather substantially higher than I've listed here

Edited to add: I've just found this "Cost of Moving" calculator on RightMove: http://www.rightmove.co.uk/cost-of-moving-house.html. For my area it estimates non-stamp duty costs to be about 1% of the purchase price, giving a total cost of around £6,500 which isn't too far off my estimate of £6,000....

pinknsparkly · 16 May 2017 at 1:37PM

My tiny financial win of the day!

I've just transferred my phone number from my previous pay monthly mobile contract at £18 a month to iD-mobile (run by Carphone Warehouse using the 3 network) and will now be paying £5 a month for more data (1.5GB rather than 1GB)

I actually set up the new contract two months ago but kept forgetting to switch numbers over so have been paying for both contracts for two months.......

So long as I can check my emails and listen to Spotify on my phone then I'm happy (I'm still an old school camera user for photos) so I'll stick with my Samsung it bites the dust! Now I just need to make sure I actually save that extra £13 a month rather than letting is disappear into grocery shopping or anywhere else

Skint_yet_Again · 16 May 2017 at 2:23PM

Well done on the phone savings, every little helps.

bobobski would be the best to advise on house purchase costs as she has just put in an offer on a property but she doesn't always post during the week.

savingwannabe · 16 May 2017 at 9:03PM

Hurrah for low cost phone usage.

Well done. :j

pinknsparkly · 17 May 2017 at 1:27PM

Thanks guys, it's silly for such a tiny win to be exciting but it really did put a smile on my face

I've been thinking that in the future if I manage to cut any future costs (such as annual car insurance, gas/elec, internet bill etc) I'm going to try and save the difference between the two. So if this years car insurance is £25 less than last years, I'll pay this years and stick the £25 straight into savings. Or if I get a new internet provider that is £5 a month cheaper, that £5 a month gets stuffed into savings each payday. Obviously, I'm expecting most of them to go up not down, and this won't work until I have a job again and we have an income that exceeds our rent and bills!

I also have some good news that I'm trying really hard not to get too excited about in case I jinx it! The money men at the two non-university organisations that I have been doing my PhD with have finally both agreed to fund a joint position for me. This is a brand new role, and so the details as to what exactly I will be doing, how my time will be split etc etc has to be finalised but the money men have said yes! we have been trying to create this role for well over a year now, and finally it might actually be about to happen :j:j:j

Skint_yet_Again · 17 May 2017 at 4:39PM

Don't assume bills will go up, if you follow Martins guides to renewing insurance - I got house insurance identical cover this year cheaper than last year. Great news on the job front !

pinknsparkly · 30 May 2017 at 10:12AM

Thanks SkinnyYetAgain. I'm hoping that by planning for the worst, and hoping for the best (such as expecting bills to go up and being pleasantly surprised if they go down) things will get there just a little bit faster!

We've just got home from a week away camping and visiting family. It turned out to be rather more expensive than we planned (by a couple of hundred pounds, eek!) so I'm going to have to tighten the purse strings in June. I'm intending to plan out meals for the entire month and buy all the non-perishables/freezable items that I can next weekend and then only buy necessities for the rest of the month!

Skint_yet_Again · 30 May 2017 at 3:19PM

pinknsparkly wrote: »

Thanks SkinnyYetAgain.

Wish I was skinny :rotfl:

Good luck with the meal planning and food shopping. I've lost the plot a bit this month but need to knuckle down again in June

PinknSparkly's Mortgage Wannabe savings dairy

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