To think £350k is a huge mortgage?

[Isawthesignanditopenedupmyeyes]

I’m mid 40s and looking at buying my forever home, BUT would need a £350k mortgage. The payments would be 38% of my take home pay, sometimes less (up to 10% less) depending on overtime/monthly variation.
On the one hand I think you have to stretch yourself/take risks to get anywhere in life and this is my last chance to flex up as it were. On the other hand it feels a huge amount and I’d be totally irresponsible going for this at my later stage of life.
I’ve no idea what an average mortgage is either.
AIBU to think fuck it, I’m going for it despite the fact my heart is in my mouth?!

I have an almost identical salary to you OP, my mortgage is slightly less than yours. It is a high percentage of my earnings, but I’m not a big spender elsewhere so it doesn’t stretch me hugely and it doesn’t worry me.

Nobody can really advise you without knowing what your other outgoings will be and whether the remaining income will be enough to cover that.......

£350k would get you a 2 bed flat where I live (not London but SE) so it doesn't seem extreme to me.

Good Luck!

How secure is your job? Though I thought mine was very secure, then I was made redundant. DHs position is likely to be adversely affected by brexit. Things we couldn’t have anticipated 8 years ago when we took our our mortgage

It's not about the size of the mortgage it's about can you afford it and what do you have left each month and can you live off of it.

If the answer is yes you can, go for it. It's three times your salary which is very normal.

It seems ok to me, it's only 38% on the worse case situation - so no overtime, you never getting a pay rise, your DH not ever bringing in more money.

Can you afford to live off what's left easily, and could you afford for interest rates to go up?

Our HH income is a little less than yours and our mortgage was £375k. For me the main considerations would be - could you afford the mortgage if interest rates went up? How stable is your employment? How much equity would you have in the house? For us £375k mortgage has been absolutely fine, although we will be paying it off for years. It was our 'forever' home too, which for us means until retirement when we'll downsize and move to a different area.

My mortgage was £300,000 and I’m in the north east so I don’t see it as that big.

£315k here. Also mid-40s, forever home, moved for the schools. 28% of our joint-net income. We will be looking to borrow a bit more soon to install a lift conversion. This was from a mortgage of £150k and a lot of disposal income.

Our joint income is about £2k off your sole and our mortgage is £220k on a £360K house so a smaller mortgage. As others have said, depends on your outgoings. We have one DC to support but adding in commuting costs/activities/food/holidays/utility bills/animals etc we don’t generally have much spare! Having a nice house is important, particularly when we’re at the stage in life where our friends all seem too! However, if you’re going to have to make big cuts on a long term basis to a good standard of living is that going to make you all very happy? Also with one of you working, it would be wise to take out income protection insurance otherwise the mortgage will be a large millstone round your neck in a worse case scenario redundancy situation and unfortunately, that’s not cheap. I have gone to the absolute max I could borrow (when I earned a lot more and lived in London) and constantly needing to watch my costs was on occasion a bit joyless!

It's a massive amount more than my mortgage, but your salary is a massive amount more than mine too. I'm 40 and have a mortgage of about £60k, on a salary of about £40k. Admittedly, this is only possible because we live in an ex council house in a cheap area in the North. I suspect that's not what you mean when you say forever home. It's my forever home though.

I find the concept of "forever home" a bit baffling tbh.
And a bit limiting?
If you have kids its even odder...they move schools, may need ferrying around if you're rural.
Gets old really quickly.
And, you know, shit happens! (Sorry, don't want to be a prophet of doom!)
Like pp we borrowed less than we could so we had more disposable income and we are going to start overpaying soon.

Sorry - posted too early!

I live in London and my mortgage is about £320k, with payments of around £1400 per month. It’s about a third of our joint gross salary and we find it manageable.

It is quite a high ratio but sometimes you have to bite the bullet or not get the home you want. I would be sure to clear any credit cards and loans first and save 3 months mortgage payments to cover any emergencies. 15 years ago we took out £270 mortgage and both our families warned us it was too much. Interest rates came down and we overpaid every month. Now we have less than £47k left to pay. I would suggest you get a 5 year fixed rate just in case rates go up after Brexit.

I bring home far less than OP and my mortgage is 12.5% of my take home.

It was 20% of take home when I got it. I I wouldnt dream of taking on one that was 38%

Just to add that if we were renting a similar property, the rent would cost about £100 more than the mortgage repayments, so it’s totally worth it in our view!

Your responses are really helpful Thankyou so much for taking the time to reply.
I’m medical so whilst my current job may go (as much as any role can) I’m confident I would always have work.
I’m insured to the hilt for critical illness and income protection too.
There would be £160k equity in the house (so not a huge amount) and I know we would have to make changes to our standard of living to afford it. So current break down - take home pay after pension £5-6.5k, £5k guaranteed. New mortgage repayments would be £2k. Outgoings around £2k but some of that a loan that will be gone soon. Not much in savings. Love to the max, lots of holidays currently but whole family happy to cut down on this.

Seems OK to me if you can manage the payments. I'd think most people nowadays have a mortgage of that size.

Good luck!

There would be £160k equity in the house (so not a huge amount)

Actually I think that sounds like a really good chunk of equity OP. I say go for it!

We are also south east and when we bought our current home 10 years ago our mortgage was £650K and about half our take home pay. Because our take home pay was large the 50% of it we had to live on was also a large sum so it wasn’t too much of a struggle. We overpaid whenever we could and we are mortgage free now.

It’s a shed load of money without a doubt but to get the house we wanted in the area we wanted (nothing flashy, 4 beds near the last station in Zone 6) it was the price we had to pay. We also picked a fixed rate deal for peace of mind.

Well you have a good salary and it sounds like you would find other work fairly easily. I think it’s fine. You would also have £160k equity so if you ever really got into trouble you could sell and downsize- although potentially have to move areas. (We did this a long time ago).

We are a low income family - dh works full time on 18k, the rest of our money is disability benefits and tax credits (ds and I are disabled). Our mortgage is £100k - although this will shortly be paid off with inheritance. We have managed fine. It’s all relative isn’t it.

my salary is around £115k which I thought was pretty good

We manage our 325k mortgage on ~90k so sounds doable.

I think you will be ok as your income is high so the percentage left over is actually quite high in cash terms. Also it's a very normal mortgage amount here in London.

I think it depends. £350k but a £200k deposit is less of a worry than €360k and a £35k deposit so loan to value is a consideration.

We have a mortgage we can afford to overpay, that way if anything changes and we have a bit of a buffer.

I'd do it on that, but I wouldn't buy just yet. If Johnson keeps going, house prices will drop rapidly.

OP no one can decide this for you. I had a 400k mortgage (now 335k) and it's never been an issue because I haven't had to compromise my lifestyle to do this.

Only you know what lifestyle you are comfortable with, will your disposable income allow you to maintain this lifestyle? If not then don't do it it's not worth it IMO. If you can afford to have both then go for it.

A 350k mortgage isn't an issue as it's all relative. Is a 200k mortgage a lot for someone earning 20k a year, yes. Is it a lot for someone earning 100k a year no. So it's all down to your personal circumstances.

I work in mortgages and people always want to know the maximum the bank will lend to them. I never tell a client until they tell me what they're comfortable spending as what the bank lends isn't important it's down to how comfortable the individual is in paying that mortgage and still maintaining the lifestyle THEY want. They know this better than the banks (to a certain extent). The banks job is to then cap their borrowing to make sure people are not over-stretching themselves.

Good luck whatever you decide OP