Advice on timings needed

[TuttoRhino]

We're not sure what to do about timings and would appreciate some advice.

DD starts primary school in September 2013 and the applications need to be in by January. We're not thrilled with the local school that she's likely to get assigned. It's ok, as in Ofsted Good, but is a three form entry and feels really big.

At the moment we're renting and have a decent deposit. We're due to get another chunk of money at some point next year from the proceeds of another house sale which would more than double our current deposit.

However, by the time that second lot of money comes through, we find something and move house, it would probably be Autumn 2013 so within the start of the new school year. If we moved areas, we'd probably get assigned the terrible school over the other side of the borough and would have to hope that a waiting list place comes up at a closer school.

So do we try and move now, buying a cheaper house with a maxed out mortgage? We could pay off a massive chunk of the mortgage within less than a year but I'm guessing we'd be subject to a (massive?) penalty for doing so. All we can afford in the nearby areas are fixer-uppers and we're not very handy.

Or do we wait until the money comes through, take less risks with the mortgage but take the risk that the school place issue may be complicated for reception year?

My preference would be to try and be settled before she starts school but it would probably mean a big compromise on the house and possibly the neighbourhood. Ideally we want a place that we can stay in for 10+ years. We've never owned a house before.

And yes we really should have thought about this way before now. We only found out this past week that we could get a massive mortgage right now. We'd been assuming that our maximum mortgage amount would be about £80-100k less so weren't considering buying until the second lot of money came through.

We're in South London. Maximum budget for buying now would be £390k versus £450-470k next year.

[LIZS]

Why not rent in preferred area while you look and wait for the money ? I would n't overstretch on a compromise.