The goal in this house is now: BUY a HOUSE!!!

[EvilEyeButterPie]

In possibly the scariest decision we have ever made, me and DH have decided to buy a house. Round here, a two or three bed in need of work curently costs between £70,000 and £10,000, so we think we need to save in the region of £15,000 as our credit isn't excellent.

We are going to start off putting aside £200 a month, then gradually up it as our income increases (we have good prospects for promotion in both our jobs, DD1 will be starting school soon, then DD2 will start getting some free nursery when she gets old enough)

We're aiming for less than three years of saving, and we think our mortgage payments will be less than our rent is now (£525 pcm)

Are we living in cloud cuckoo land? £200 a month is pretty much all our "spare" cash after bills and food, but we will be able to know we won't be chucked out on the landlords whim and that is worth any amount of scrimping.

Not that bothered about ever owning the house, tbh, but to have that security would be wonderful.

A repayment mortgage is definitely a good option because, every month, you bring the capital down a little. Often, there's also the option to pay extra lump sums off the capital and this has the effect of dramatically shortening the remaining term of the mortgage. There are some good Mortgage Amortization Calculators which show how it all works. An independent mortgage advisor can give you more information and get you a deal appropriate to what you can afford.

'Go ahead, stretch yourself and buy at an inflated price, that's what the greedy banks want you to do' - actually we have owned since 1984, and we bought our last place in 1992, so we didn't buy at an inflated price at all, and are within sight of paying the mortgage off.

EEBP - repayment mortgage as Chil says. We went the endowment route in the 80s and got hit, so switched to repayment. Wish I'd done it earlier.