I will never get a mortgage like this again, would you go for it?

[Etei]

I secured a rate of 2.74 which I think has now gone up. The house sold for 480 and I have around 180 equity. The mortgage repayments will be around 1k a month. This is huge to me, if I stayed in my current place it would be 450, with only 100k remaining (I’d be on a slightly higher rate as not secured it yet).

The plan was that me and DP would repay the mortgage with me and we’d both live there. I’m pregnant so I won’t be able to get this mortgage again. DP can’t be on it as he has his own place and it would complicate the status of the place ie make it a buy to let.

We’ve broken up. I’ve calculated he will have to pay around 700 in maintenance. He’s very work obsessed so I can’t see him changing jobs though it’s possible. I can pay this without him but it would be tight, leaving me around 500 a month spare for food and 200 for bills. I only have 15k savings. Maternity is covered.

What would you do? If I don’t go for this now I have no means to save for more deposit when prices go up, as they will eventually. I also probably want to cut hours (above calculations are based on cut hours) and wouldn’t get the borrowing at that point. I would then be stuck in a 2 bed place for a long time.

Have some family money but don’t want to rely on that as feels very unfair. Not sure what to do? The new place isn’t huge but means friends could stay and there’s room etc.

I from experience, mine and other people's I'd be worried he won't pay, cms are shite

2 bed place is fine

If people want to stay over you just all bunk up as best you can

A dream of an impressive perfect house ties you to a lifetime of financial stress

You and 1 child don’t need anymore than a 2 bed, so if that’s your current place then I wouldn’t move because you can’t rely on the maintenance and you really don’t want to be struggling if nursery fees go up, rates rise at the end of your fix, DC wants to do hobbies etc.

You are making yourself extremely vulnerable if you are relying on payments from an ex. His payments will be reduced when he has more children.

I'd stay put, OP.

Personally I would stay put. You have no guarantee he will actually pay CM. Childcare costs are high and ours have risen twice in the last year. You don’t need anything bigger than a 2 bed for now if just you and baby.

@Etei I’d go for it. I did similar years ago and worked really hard to buy ex out. So glad I did. I worked crazy hours for over a year - joked I didn’t see my house in daylight, but it has put me on good financial footing now for the future.

Op when you are pregnant it is not the time to be increasing your debt. Stay where you are.

He's a shit to spilt with you when pregnant, no guarantee he won't be a shit when it comes to maintaince.

Having a spare room is lovely but really with a baby you probably won't have friends staying over that often.

Once your back at work after maternity and can see how food prices, nursery bills are thats when it might be worth thinking about moving.

Op's pregnant, she won't be able to work crazy hours, mat leave and childcare costs will reduce her earning power

Stay in your 2-bed.

I absolutely would not base any long term investment on his contribution. Would the bank even allow you to?
I’m sorry to hear you’ve broken up

For a difference of 500/month, and on that rate (for how long?) I, personally, would do it.

But I've always been a bit of a risk taker.

I'd do it as well. It's a long term investment. A spare room could be used for a lodger if things are tight.

So your calculation is without his maintenance? And at reduced hours?
Have you factored in childcare costs?

I think responses will be 50/50 - as some people play very safe, some live a bit more dangerously. Only you can decide, only you know how you spend money, how you like to live.

In reality OP whatever you've calculated he should be paying doesn't mean he will and I would not factor this in to any financial decision. Unless you've proof of that money coming in regularly your bank statements to date I would be surprised the lender would consider it a reliable form of income or one at all.

Nothing wrong with a 2-bed house for yourself and a baby at all so I would stay put, on balance it is the safer option, particularly given you are pregnant and the cost of living (and raising a child) is rising and will continue to do so for some time yet. I really can't imagine in reality you would want a lodger with a new baby in the house, or that a lodger would want to live in a home with a newborn and such a large leap in monthly outgoings in this scenario.

IMO the risk here is too big when staying put leaves you financially comfortable. I'm sure there are many on here who would consider 15k savings to be more than they are able to achieve and I do think saying 'only' 15k is a bit off. Better to keep it for a rainy day than risk moving and dipping into it should things not go to plan. New houses often come with hidden costs once you move in.

I wouldn't want a lodger in a family house.
I also think many lodgers would be put off by having a small child in the house.

Maybe OP wouldn't mind a lodger in a couple of years if things were really tight. Maybe she might know of someone who wouldn't mind a small child. Point is a spare room gives options. And a 3 bed house is more likely to increase in value than a 2 bed so OP's equity will grow.

This. This. This. And more of this.

I never thought my ex would leave his £60k a year job. I was receiving £700 per month in maintenance. Then he was made redundant and never worked again.

I suggest ypu talk this over with soneone who can look over your finances in detail.

1,000 Mortgage
500 Food
200 Bills

Is the 700 from your ex on top of this?

Bigger house means higher bills, what aboot childcare when you go back to work? Do you have a car or commuting costs?

And then there is the uncertainty around child maintenance.... which is huge!! Is there anyway that your ex would release 100k from his house and pay that to you in lieu of maintenance? (I know... flying unicorns!)

I am sorry your relationship has broken down, it is a terrible position to be in when pregnant.

Don't forget that the energy prices are meant to shoot up by 65% so you really need to take this into consideration!

I would go for it. I’m not risk adverse though. You could always sell it and buy smaller again should you need to. It sounds as though if you don’t do it now the opportunity won’t arise again for several years.

This.

i think the advantages of securing your financial position on the housing ladder outweigh the short (and possibly medium) term belt tightening.

However I would make sure that I also immediately began to overpay the mortgage to get ahead by 6 months of payments (or if the mortgage doesn’t let me, put that money in a savings account). Then, if your ex doesn’t pay, you will have a buffer. Yes, it will take awhile to get to 6 months ahead, but you need to do it, even if it is £10 pounds/month to start.

I also know that I live within my means. No other debt. And I have an emergency fund. As if you are already squeezed on your house payment, you can’t be squeezed in any other payment - eg paying off a credit card, or having an old car, needing a new one soon and no savings. Or haven’t factored in the new electricity rises yet.

Finally you have to be ok with saying no - to dinners out, to new clothes, annual holiday might be local for a few years, not overseas etc, as you are prioritizing your house over these things. I think it’s worth it and would do it. But you need to consider your own circumstances and see if you are comfortable with the same choices.

3 bed house has way more options than 2 bed flat (which realistically you will now be stuck in for 20 years) - not least the ability to trade back down again if you need to (although hopefully not to soon given stamp duty/moving expenses)

not least, as the child gets older, is having a spare room means you have other childcare options open to you, or room for an office to work from home or any one of 20 other, very good reasons for a spare room.

My recent experience is that house maintenance increases are no different to flat management fees, but only OP would know what the fees are like in her flat.

I also agree with this, but am also a slight risk taker. I felt a bit uncomfortable about the size of our mortgage when we bought our larger house but in reality, you make it work. If you have to eat beans on toast for a year or not go on holiday for a couple of years....you make sure those mortgage payments are paid. For us, it's meant we have more equity in a bigger asset and we do have the option to downsize or rent out a room in future.

However.....is that £700 from CMS payments critical to you being able to afford this move? Because I do think that's risky. If you can't afford it at all without the CMS payments then I think I would stay put. If you could afford it on your own but wouldn't have a lot of spare cash and the CMS payments would be a bonus then I probably would move.

Stay put until after baby is born, Maintenence and work settles down, maybe 2 yrs then decide what to do. You say you have family money if you need it, then chill out, get baby settled and start over from there, no need to take risks or get stressed more.