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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

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Original poster

to mortgage ourselves over our heads?

489 replies

NCFC4now · 06/10/2021 16:19

DH will read this so I suppose your opinions will help settle a debate.

DH is 32 and I am 27. We currently own a 3 bed semi Victorian house, it is in a desirable area we love, in the 18 months since we’ve moved in the value increased £75k (bank mortgage valuation) because of the housing bubble.

We over pay our mortgage every month and have a growing amount of equity (especially with the increase!)
However, whilst I love our house, it doesn’t have parking and I find the garden just a bit sad (neighbour has huge trees that block out a lot of sun because the garden isn’t big). Due to the area, parking is difficult and you tend to have to park down the road from your own house.

Because of our location, which we won’t compromise on, a 4 bed with parking, nothing fancy will be £1m. We can get a mortgage for £800k. In my mind, we should wait 2 years (fixed rate ends) and save as much as possible and go for it.

Using present rates available to us, our mortgage minimum payment would be £2.7k a month over 30 years. We can afford this but would mean we can’t really do a step wrong. It would also mean our savings are wiped out due to SDLT so would need to replenish those.

I grew up in poverty and we have achieved everything without any help so I suppose a big house has always been a symbol of achievement to me.

Is it a dumb idea? Tell me your thoughts! I am a bit scared about losing our jobs and whilst DH is a teacher so safe, his extra income comes through a business he runs which I think is stable but you never know. I also hate working and have some mental health issues. Also this could be made worse financially if we do have kids as planned in a couple of years…

DH wants the house but doesn’t want the debt and thinks we should stay put. My argument is simply that having a child and no parking space will cause a breakdown at some point if I’m already stressed whilst fit and childless about the situation.
Thanks

OP posts:

TataMamma · 06/10/2021 17:03

It doesn't really answer your question, but irrespective of what you decide, have you thought of taking in a lodger? You can earn up to around £8,000 tax free. It's not ideal, and probably not practical with young kids, but it might make things easier for a short time and allow you to build up more equity, or have a bit more available with whatever decision you make.
More generally with rates so low (and likely to go up with rising inflation soon - also it's really difficult to get a good mortgage with young kids and child care costs, even more so if you are working part time and there's any self-employment/business funding much of it), and house prices only likely to increase I would do the best you can. If the worst comes to the worst you can sell up and have more equity for the future.....
Good luck x

OakPine · 06/10/2021 17:04

You say that you "overspend like idiots" and have no idea how much childcare costs.
And you want to take on a massive mortgage because you want a parking space?
Yeah great idea. Go for it! What could possibly go wrong!

CraftyGin · 06/10/2021 17:04

It would be lovely to know which area so that the Rightmove warriors can find you the perfect place that you can also afford.

Understand why you wouldn't want to share though.

lindjam · 06/10/2021 17:04

I don't understand - why do you need a 4 bed house?

There's two of you and you don't know if you will have children.

Why can't you get a 2 or 3 bed with parking?

ferretface · 06/10/2021 17:04

Nursery is thousands of pounds a month here in the southeast, don't know how our friends do it tbh (we are childfree).

We have a similar take home to the OP and our mandatory repayment is 950 per month. Honestly knowing that no matter what happens (one of us could lose our job entirely, interest rates could soar) we will be able to pay for the house is such a comfort to me. I grew up poor and the idea of stretching to pay for a house when there are so many external things that could come and make it impossible is just frightening to me.

buttermutt · 06/10/2021 17:04

I would also fix for any new mortgage

TataMamma · 06/10/2021 17:04

*do the best you can
Meant- get the biggest/most expensive house you can.

IShoveLula · 06/10/2021 17:05

buy the 4 bed and get 3 lodgers

CSJobseeker · 06/10/2021 17:05

There was a thread recently about 'keeping up with the Jones' and how freeing it is when you realise that you don't have to lease the big status car, buy the big status house etc. I feel that's really relevant here.

I live in a comfortable, moderately priced, house in a beautiful part of the country and own a moderately priced car and campervan. None of it is 'high status', but knowing that I am financially secure and have choices in life beats anything that 'keeping up with the Jones' could give me.

buttermutt · 06/10/2021 17:06

Yeah, so we bought a house with a mortgage payment low enough that I could drop to part-time post-baby or we could survive on one salary plus savings for a few months.

But that isn't normal is it? Otherwise we wouldn't have shared ownership, help 2 buy, 30 yr mortgages, interest only, family platform mortgages etc

wewereliars · 06/10/2021 17:07

You would be insane.

Your house may drop in value if you buy at the top of the market, interest rates are likely to rise in the next year and you are planning kids, which cost an absolute fortune.

Youseethethingis · 06/10/2021 17:07

My advice is to find out the maximum you can afford then row back from it as hard as you can. Life's too short to live hand to mouth for a house that isn't even anything special.
As an experiment, I'd be very strict about saving the difference between your actual mortgage and your hypothetical mortgage. Then maybe add £1k notional nursery fees on top. Stress test yourself basically. What can you still afford? What have you had to cut from your lives in order to live within these constraints? How do you feel about it? Will the car be grateful for your sacrifice to give it it's own bedroom?

Original poster

NCFC4now · 06/10/2021 17:07

@MaeD yes so one of the reasons our area is so high is we have a few of the top 20 schools in the country within catchment (DH is VERY against public school)

Nursery fees would definitely be our kryptonite I think.

OP posts:

wonkylegs · 06/10/2021 17:08

I wouldn't personally - we've only ever gone up the ladder when we were comfortably able to but at the moment I would be very wary due to general economics.
Maternity Leave & Childcare can be very expensive especially at first.
With my first, childcare costs for the first 2 years were 90% of my wages - it made no financial sense
Luckily we didn't need my salary to pay the bills so I could just keep going to make sure my career didn't fall in a pit.
It's looking like it's going to be a Rocky few years in terms of cost of living rises and it's going to stretch lots of people.
Remember bigger house also means bigger bills for utilities, tax and insurance.
I think atm I would be playing it safe.
We lived for the first 5yrs of our eldest's life without parking and it was fine, annoying but fine.

Horseshoe5 · 06/10/2021 17:08

I would not buy the other house. What if you got pregnant and had twins? Would you manage on one salary?

I would hold off for a few years if it were me.

YearsSinceISawYou · 06/10/2021 17:09

Why don't you wait a while until you see which way the wind is blowing on interest rates.

No-one knows what is going to happen but it will hardly be a shock, in this climate, if it suddenly jumps up.

Original poster

NCFC4now · 06/10/2021 17:09

@OakPine fair play… I asked for that. But I do have £50k in savings all through my own doing so I can’t be going that wrong. We could easily save more than we do but we choose to be frivolous with eating out. We don’t spend on anything else really.

OP posts:

ShowMeHow · 06/10/2021 17:09

Well you’ll certainly be stressed with no financial wiggle room and might have to sacrifice something else. Never over commit yourself financially it’s horrific if it happens to you but no excuse if you do it to yourself.

Look at making your garden a bit happier and as for the parking well yes it’s a pain but it’s the sacrifice you make for living the location and kit being able to afford more.

Tilltheend99 · 06/10/2021 17:10

Later house fair enough, and each to there own but the emphasis on parking is just a bit sad to me.

It is a risky climate to take on a lot of debt in. Also, fair enough for your husband to not want the pressure as he would be the main earner if things went wrong.

What would be the problem with waiting a bit longer and building up more savings if you think you would be able to replenish them?

Based on what you said about living in poverty it seems that once you got the bigger house you would just be into the next thing. Better to deal with your feelings about your childhood and make the decision with a clear most mind.

YearsSinceISawYou · 06/10/2021 17:10

@CSJobseeker

Couldn't agree more!

kitkatsky · 06/10/2021 17:11

Madness! Childcare is extortionate and all the financial experts are expecting a rise in interest rates very shortly. Also, after 18 months people might be turned off your house because why would you be moving so soon?

EmKayEm · 06/10/2021 17:11

In the current economic climate, you would be foolish to take on such a huge debt.
You are relatively young, but could easily spend your best 'child-rearing years' mired in debt.

anonymousanne · 06/10/2021 17:11

So I could be wrong but your post makes it sound like you don't work. If your DH is a teacher and you 2.7k is 34% of your budget then it is surely his side business that is bringing in the big bucks? Not the teaching which you say is secure.
Personally I wouldn't take on a mortgage I couldn't comfortably afford. We have recently questioned what we are going to do too (we have a 3 bed semi, nice sized garden and off road parking, but I dream of the big detached 4 bed etc). We have decided to stay put and invest money here (attic conversion for 4th bedroom that won't return the investment but will improve our lives here). Ultimately we decided we were not comfortable spending most of our income a month without any substantial savings. We over pay on this mortgage and still have saving and this is something we couldn't achieve on a higher mortgage.
You say you have no children and honestly that's a huge factor. We could get by barely spending anything until the little ones came along (11 months and 2 1/2). They never stop growing, eating, we do swimming lessons, entertainment in the week when it's miserable outside... and that's before nursery (£1100 a month for us, will be about £700 a month when my oldest gets her 30 free hours). Could you not look for slightly bigger mortgage and think more about a nicer garden and parking than bigger in terms of size and bedrooms? Could also consider 3 bed that could be converted to 4 like we are doing.

Tilltheend99 · 06/10/2021 17:12

*larger house

Inthemuckheap · 06/10/2021 17:12

Eh? Putting the house situation aside, you say you hate working and have MH issues. I am reading you want to stop work once you have children and both want to go part time? How on earth would you afford the mortgage. I think you are being rather shortsighted. The parking is a pain, but hardly insurmountable.
I suppose you could sell your £1mio house if need be but by that time you may be in such financial straits that if wouldn't get you out of the hole you will have created.
If your mum has baby one day a week and you'd only need childcare 2 days a week are you already only working 3 days a week? If so, plus your DH being a teacher, how do you bring in close to £10k a month?

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