To ask what your comfort level would be in terms of this financial position and Mortgage?

[Sleepdep2]

Having a slight disagreement with DH over this, we are looking at houses and aren’t yet on the same page re. Outgoings.

Situation:
-2 DC and won’t have any more, total nursery costs £200 a month.
-1 car we own, petrol costs c. £150 a month
-Our personal bills e.g hair appointments, phone contracts, spotify etc amount to £100.
-Budget c.£600 for food per month.
-Pensions are funded from salary deductions/employer contributions so don’t need considering for this exercise. We are both 40.

Joint income of £4400 (salary only, not including the £200 a month child benefit we recieve) the above amounts to £1050 leaving £3,350

My question to you all is what of the remaining £3,350 would you be comfortable spending on your Mortgage/Bills, knowing that some also needs to be earmarked for fun/social and savings/investments?

Factor in contingency if mortgage interest increase if we fall into a recession. I remember in the 80s when they shot to 15%. It doesn't help that the government is shit and the economy still feels very unstable. I still wondering when they are going to start tackling the Cost of Living Crisis as everything just keeps going up and up and up.

What? Lol

You didn't say that, how are we to know what your other bills total and how much to put the mortgage down by?

So your mortgage/bills needs to include:
mortgage
life insurance
house insurance
council tax
utilities
maintenance
internet

You’ve given yourself £100 total for hair cuts, phone bills, subscriptions which doesn’t sound realistic for two people. I’m also wondering where the money is for kids activities eg soft play/swimming, holidays, birthdays, Christmas.

You need a much more detailed budget with annual costs factored in before you can say how much you have (or how much you’ll need to cut to afford the mortgage).

Mortgage no more than 25% of take-home so ceiling of £1,100. And mortgage term no longer than 25 years.

Financial experts say that your mortgage should be no more than 25% of your income after tax. We have always followed this and it’s definitely worked for us.

I would want 500 as spends for the month and 500 savings (for holidays etc) in the short term.

Long term I would need 750 that for month spends (excluding food) because kids will only get more expensive, and probably 750 for holidays. But thats with the thinking that my income would be going up long term.

That would be my minimum based on what you’re sharing there.