to want to pull out of buying this house?

[AKMD]

Background: we are expecting our first DC very shortly. I will be taking maternity leave for 9 months and then going back to work full-time. DH earns significantly less than I do (about 6k less at the moment) and we definitely can't afford to pay essentials bills without my income. We are financing my maternity leave with savings (we hope).

We are about 3 weeks away from completing on a house that I don't particularly like for various reasons, but have allowed myself to be talked into accepting. We spent ages viewing other houses and didn't see anything else we both liked, and we wanted to buy before stamp duty comes back in in January. I'm having some serious misgivings about the whole situation though and really don't want to buy the house at all, not only because I don't like it much, but also because I don't think we can really afford it. DH is hopeless with money, we don't have a joint account and I am continually having to bail him out because he has overstretched his finances. He ignores budgets, constantly buys things he doesn't need, signs up to services we don't need and I don't want (e.g. Sky TV, yuck), lends money to his parents without asking me and is generally a liability where money is concerned. The only way we have a deposit for this house is through my savings; he has none. I just don't see how we are going to be able to stay above water when my income is seriously reduced, especially with the expense of a new baby. I have raised these concerns over and over again with DH but he is very good at talking me into things so this has led nowhere. I am now panicking a bit because once we exchange contracts, there is no going back and I think we might seriously regret this.

Do I have legitimate concerns or am I just getting cold feet at the thought of having so much of a financial responsibility? WWYD?

Yes, that is an awful interest rate. Why would you pay fixed rate at nearly 6.5%?!!

Also think the credit score is v sus.

Abetadad they've not exchanged yet, so it's still at the offer point.

Agree that you need to get copies of both credit reports. A single mortgage application doesn't do that, and why are you being offered a sub-prime interest rate?

Your broker has a couple of grand riding on you getting this house at a time when their incomes are very low, comparatively. He isn't about to try to tell you it's a bad financial decision.

I would suggest going to a reputable broker (I"m sure someone on here can recommend someone) and get them to look into this in more detail.

Either your mortgage broker has done something dodgy, or there is something in your financial history that is making you look like a bad or risky bet, which doesn't add up if you have no debt and decent savings.

as you haven't exchanged then back out now

if my DH was useless with money I'd be making sure the house and mortgage were in my name only

I hope your conversation with dh went ok and you are going to back out.

I would get your credit scores checked with experian fwiw as that sounds too dodgy.

I think your poor credit rating is because you've never paid off debt. Ironically if you haven't had debts and paid them off properly, they just don't know anything about you so you get a poor credit rating. It's as if you just entered the country with a blank record -- they don't know.

Just pull out. I can't believe you're going to make such an enormous commitment to "save" ~2k stamp duty. At the increased monthly costs it'll be less than 6 months before you're able to save that 2k if you rent - and as others have pointed out there's always the damned exploding boiler/fridge issue.

Don't put yourself and your finances under such strain.

Wait until your baby is older, you are back at work and things are more settled.

At present you have no way of knowing how things are going to be after the baby is born, plus you will have added expense of childcare when you do go back to work.

I agree with the rest of the girls PULL OUT.

Check out this article by Martin Lewis to get your credit refrence files for free

www.moneysavingexpert.com/loans/credit-rating-credit-score

Also get yourself on the forums there.

If you ring the Co-op and ask for a Cashminder account, they will give you a joint one. You can pay money in using the Post Office, pay DD's and SO's, have telephone and internet banking, have an electron card. It doesn't have ovrdraft facilities or a cheque book.

Get your OH's money paid into that account and give him an allowance each month.

Just want to reiterate - you could end up having a mortgage you can't pay, on a house you don't like, that's worth less than you paid for it.

A poor credit score due to lack of debt history would make for a higher interest rate, but this rate isn't just high, it's verging on sub-prime. Plus no credit history wouldn't bar people from a joint account - it would need to be a bad one, IMO. You are both on the electoral roll at your current address, yes? That's one of the simplest and easiest ways to improve your credit rating, because it proves that that person lives at that address, and a con-man isn't committing identify fraud. If you really do want to buy that is something that is well nigh essential. Perhaps also get a credit card, put something small but regular on it (a supermarket shop each month) and pay off in full. That improves your rating, too.

Please, please pull out. We've had people do it to us before, and while a pain it wasn't a big deal - we understood, it's the biggest investment decision they can make plus will be their home, they have to be certain. YOU have to be certain. So much might go wrong, it's going to cost you a bomb, and for what? You don't even like the place!

The rule of thumb is that a house costs you 1% of purchase price to maintain per year, and in my experience that's about right. Storm drains get clogged and need clearing, aerials get blown down in winds, tiles go on the roof and have to get sorted before leaks start to rot the joists, appliances go kaput, boilers need servicing to stop them going kaput, repainting and carpet cleaning needs to occur every few years and that adds up, God knows what else, just to stop the place falling to rack and ruin - you aren't improving it and adding value with any of that, just maintaining.

Enjoy your baby, and freedom from being the one who has to think about all this stuff, unless you fall madly in love with a house. The obsession with house ownership in this country is imo nothing short of madness, when it leads to people living somewhere they aren't mad about, and can't afford, and might destroy them financially, when living somewhere lovely is cheaper and financially safer.

The interest rate on the mortgage is so awful because the deposit is partly vendor-gifted and only one provider will lend on that.

Thanks again!

"The interest rate on the mortgage is so awful because the deposit is partly vendor-gifted and only one provider will lend on that."

Is it new-build, then?

AKMD You've answered your own question, the deposit is "vendor-gifted" because you can't afford it.

Newbuild vendors have been giving "cash back" to keep their numbers up (and not annoy those who bought earlier), but there seem to be dangerous distortions in this practice (lenders are dubious, future value not assured, etc.). Have a look at the Guardian's/Observer's features on this:

this on incentives and downvaluing: www.guardian.co.uk/money/2008/oct/12/houseprices-mortgages

www.guardian.co.uk/money /2008/sep/27/property.mortgages.barratt

lending restrictions on newbuilds www.guardian.co.uk/money/2009/feb/01/banks-mortgages

Have a look at the mortgage calculators online.

You will be able to see that a high interest rate makes a huge difference over the life of a mortgage. Much more than the $2k you will save re stamp duty.

If I were you, I would pull out, make a detailed financial plan of how to save for a deposit over the next 18 months, along with how you will fund maternity leave, and then stick to it.

Get your DH on board with a financial plan as well if he is a bit flighty with money.

Then when you can buy once you are possibly back at work, you will feel in a better financial position.

Good luck!