Your views on the money side of buying a flat - who gets what?

[googleismyfriend]

I'm putting in £4000.
Brother is putting in £5000.
Help to Buy loan is £29,000.
Monthly mortgage payment is £280 and I will be living there on my own.

My brother wants me to pay the full mortgage payments on my own during the period I will be living there (about 2 years) and he wants me to pay an extra £1000 on the Help to Buy Loan as I will effectively be living rent free for 7 months when I make up the £1000 extra that my brother will have put in the deposit. Thereafter we will rent the property out and share the rent proceeds equally.

On sale, my brother and I will split the sale proceeds equally.

Does this sound fair to you?

So you will both (eventually) put in £5k.

On top of that - whilst you are living there you will pay “rent” of £280 which is significantly below market rate.

I think it is a great deal for you as long as you want to live there. If you would rather stay at your parents then it is a rubbish deal.

How will you pay off the loan though? £29k / £280 is 103 months which is over 8 years even without allowing for interest.

So your getting 2 years free rent...
£280 * 24= £6720
So 24 months of how ever much you would rent a home for...that is cheap.

Can you afford to buy on your own?

As if you overpay for four years £300 a month you can own alone....

Is the property only £38,000?

Thank you to the above helpful posters

My brother and I will be paying back £29k over 2 years. So, £280 is my mortgage payment, that's separate from the loan. I'll use the rest of my salary after bills to pay back my half of the loan.

HollowTalk- haha no, it's £150k. There's a loan coming in from my parents too, and a mortgage.

Because I'm paying a 4k deposit and then around 4k on mortgage payments

Doesn't work like this. You know that over the life of the mortgage, you pay a fuck of a lot more than the initial borrowed amount due to that pesky thing called interest?

Suggest you read up a bit more before taking an adult step like buying a house. And not just on a forum. Like, some really basic understanding of how loans work.

4k of mortgage payments does not equal paying 4k of capital off. In fact, you will have hardly paid off any capital.

To be fair you could both pay 50% of the mortgage. Then you could pay your brother 50% of the market rent for the house. I suspect you will end up in a worse financial position doing that though....

Yes your getting a good deal... On the rent... Bite his hand off...
The other bit....
Save £500 and give it too him ...
So you both invest £4500 cash in the house... Otherwise it works out as unfair....
So you both pay your half of mortgage, and you pay him. The £500 ASAP

Sorry I misunderstood - looked like you had a

• total upfront payment of £9k
• loan of 29k

and a mortgage for the difference and it was the mortgage you'd be paying while you lived there at £280 a month.

Just couldn't understand how you were going to cover the £29k loan inside 2 years while only paying £280 a month and with a mortgage on top of it but obviously, I don't know everything about how you intend to finance it

listsandbudgets That's what confused me too. OP didn't give the full picture.

sunshinesupermum, I think based on later posts, the balance of the loan is going to come from her parents and they will pay the ongoing mortgage through the rent.