Help to buy help!!!!

[Lilylauren98]

Hi everyone,

Myself and DP are in the following position:
House to sell & valuation will mean we make a certain amount on it + savings.

We have seen some detached new builds in our area. Valued at 312k.

Our max is 270k... meaning we can afford the semi detached or terrace houses on the site, without help to buy.

However using the equity loan, we could comfortably afford the detached house.

With our projected earnings for the next 5 years, by the end of the 5 years we will earn enough to be able to remortgage the whole amount. This will also mean our monthly payments are less for 5 years, so we can continue to save.

I would just like to know AIBU? Is this a good idea? We have in writing how both of our wages will increase & when.

100% do it. It’s a step up the ladder that you wouldn’t have had otherwise and you know that you can afford it after five years.

My only caveat is that you should check that you could still afford to remortgage after five years if the property value goes up. Remember it’s an equity loan, so if it’s 20% of £312k now then it could be 20% of 330k (totally random figure) in 5 years time that you’d be paying back.

The fallback if you’re questioning that is that you can just pay the interest on the loan after five years - you won’t be forced into a position where you have to sell or have to remortgage.

WHY “100% do it”?

New builds are not all built equal; do some serious due diligence on the home builder and look for horror stories, poor build quality etc.

Ask yourself if this is the right time to stretch yourself. I know some people on here think housing is some sort of one way bet, but depending on what part of the country you’re in, it could be the case that the asking price of the new build in eight years time is not a great deal more if anything. So unless it’s your forever home, I’d go in with eyes open. If you do go for it? Best of luck and hope you enjoy your new home