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Original poster

Please wise ones, tell me what you would do in our financial postion? All views welcome.

92 replies

WideWebWitch · 10/08/2007 11:28

We are renting a (nice enough) house. But we don't have a garden and dd's bedroom is a cupboard. We could buy a house soon-ish. BUT If we buy our mortgage will be 40% of our net monthly income, when it's much, much lower atm.

And there's a possibility I will be made redundant at some point. If I am the payoff will probably give us enough to live on for 6 months.

If I'm not made redundant then we can afford to pay this sort of mortgage on current income. My salary contributes c60% of our income.

Best case is that I'm made redundant AND get another job.

Worst case is that I'm made redundant and don't get another job for a while. I'm a bit nervous of this as I spent 8 months out of work before taking this job.

So, never mind house prices, we'd like another bedroom, another bathroom, a garden and to paint dd's room pink.

Would you buy in our circumstances? Or wait to see what happens with jobs?

One of the things that worries me is that atm if I wanted to tell my employer to stick it (always a possibility when you're a stroppy mare like me, I'd go contracting if I did this) then I won't be able to given a larger monthly payment to keep a roof over our heads. So I guess the larger committment scares me a bit.

All views welcome, sorry this is so long.

OP posts:
TranquilaManana · 10/08/2007 14:02

PM?
are you a prime minister?

WaynettaSlob · 10/08/2007 14:09

CD - not to worry , thought I'd ask anyway

WWW - I would buy now - you know you want to!!!!

TranquilaManana · 10/08/2007 14:11

what the hell is a PM??

Original poster
WideWebWitch · 10/08/2007 14:23

PM = Project Manager

Is it Countessdrac
or countessdracula @ g m etc?
I sent to countessdrac at g mail etc

OP posts:
TranquilaManana · 10/08/2007 14:25

ah
obv

thanks

Mellin · 10/08/2007 14:37

The thing is, even if you decide to buy a house today, it is unlikely you will find the perfect place quickly. It took us 9 months.... but then we are picky bastards.

I would say start looking for a house asap, get a mortgage agreed and start budgeting your spending as if you already have a mortgage. And in the time that it takes you to find your perfect house, all the uncertainties about redundancy/quitting/interest rate rises etc might already be decided and you can re-evaluate then. Versus waiting years in case you might be made redundant.

Original poster
WideWebWitch · 10/08/2007 14:51

Mellin, you're absolutely right, wise words.

DH really really wants to wait for prices to go down but I am 40 so a mortgage from now for 25 years takes me to 65. DH is 31 so I think thinks he has all the time in the world.

OP posts:
EmilyDavidson · 10/08/2007 15:06

Prices might not go down though and even if they do the economic dive that forces them down might hurt your earning capacity too.

I used to be like you re the amounts of 'frittering' money (maybe not quite so much),but then I woke up and realised you can literally half your spending without impacting your lifestyle much. I paid my mortgage off in ten years just by being better with money.
a mortgage doesnt have to be a 25 year millstone round your neck

BreeVanDerCampLGJ · 10/08/2007 15:31

We moved North - South Eek. When we took this mortgage on we kept the life of the previous mortgage. I.e we had done 10 of 25, so we kept the term at 15 years.

Only problem was we ended up paying most of the mortgage back on repayment, so we are paying £200 k back over 15 years and it was very tight it is getting easier. And on the upside we only have 8 years to go.

The best piece of advice I got was from my mum, when money is tight make sure you are saving the banks money but in a different bank. So we set up a DD for £250 a month to go to my account from the joint account. We used this to tax cars, insure cars,buy tyres etc.

This frequently made us over drawn, but there was a strange comfort in DH saying I need new tyres or the car needs servicing and I being able to say no problem I will transfer the money.

HTH

LGJ

Original poster
WideWebWitch · 10/08/2007 15:35

Thanks and at 8 yrs to go. DH is worried about no contingency/savings. I reckon we can EASILY save quite a lot every month between now and actually buying somewhere. Our essential costs aren't that high, it's our luxuries/frittering that's out of control.

I've made an appt to see a house tomorrow morning.

OP posts:
casbie · 10/08/2007 15:51

get your morgage sorted out waaaaay before looking though, as it can take 6 weeks or longer for a bank to accept you!

also, when looking to buy a house, if you have no chain (house to sell yourself) then that makes you as a buyer more appealing. use this to your advantage when haggling!

Original poster
WideWebWitch · 10/08/2007 15:53

thanks casbie.

Pruners, that house is wow, I wish I was filthy rich!

OP posts:
hunkermunker · 10/08/2007 15:56

Buy.

Stop spending money on unnecessary shite.

Enjoy painting DD's room pink.

tortoiseSHELL · 10/08/2007 15:59

I think I would wait until I knew what the current situation was going to hold, but save madly in the meantime. Motley Fool today said that London House prices are starting to fall here so it may be the same where you are. I think it would worry me to take on a mortgage when work was a bit shaky, but that's just me! Why not start looking, and get your 'eye' in, and then when you feel confident you can move quickly.

BreeVanDerCampLGJ · 10/08/2007 16:00

As ever Hunker gets to the nub of it.

hunkermunker · 10/08/2007 16:03

I think you are spending money on fritterage because you have it to spend.

If you keep doing it, you will be 60 and renting still. Some people are happy with that situation, I would not be. I need to be working towards ownership of my home. I want one day not to have to pay money to anyone for the roof over my head.

LGJ

BreeVanDerCampLGJ · 10/08/2007 16:04

MSN if you please Hunk ...

mslucy · 10/08/2007 16:13

stop frittering now.

Take out fixed mortgage - interest only to keep outgoings as low as poss.

What exactly are you waiting for?

btw. I work contracts and it's never held me back in the property stakes (I own 3 and I'm by no means wealthy)

hunkermunker · 10/08/2007 21:56

(Sorry, LGJ - wasn't on my PC earlier - are you OK?)

Bluestocking · 10/08/2007 22:07

Buy. House prices are not going to fall appreciably. Here is a cautionary tale. A couple I know sold their very desirable cental-ish London flat a couple of years ago because he was certain (he could feel it in his water) that prices were going to crash. They have been living in a very much less desirable rented flat since then - the flat they sold has doubled in value since they sold it - and the money they made selling it is now not enought to buy them somethin equivalent.
FFS stop with the present buying and the takeaways.
Being stroppy at work is fine but you may well feel a lot less compelled to do it when you are paying a mortgage. This may actually lead to you taking a more tranquil approach to your work which can only be a good thing.

Millarkie · 10/08/2007 22:28

Buy now (whilst you are a good bet for the mortgage company) - but take out mortgage protection insurance (we pay about 10% of our mortgage payment per month for this (covers both of us - accident, sickness and unemployment)- but dh is also a PM and has been through one redundancy already so worth it for the peace of mind)

And be prepared to rent out the spare room if things get tough (we did this when our childcare bill was more than I earnt!)

And give yourself a sensible 'budget' for groceries, clothes, presents etc - then add 30% to it And then try to stick to the number you first thought of.

And post a photo of your dd's new pink room (I am - I want to paint dd's room pink but she is adamant that she wants a 'spiderman' room )

MyMILisDoloresUmbridge · 10/08/2007 23:03

Definitely buy. And definitely go and work for CD!

Original poster
WideWebWitch · 11/08/2007 08:28

Thank you for these new posts.

Dh pointed out yesterday that our tenancy doesn't run out on this house until next April and that if we save as we think we can, i.e stop frittering thousands away then we can save a substantial portion by then and will have a clearer idea of what is happening with prices etc. BUT he sort of agrees that if we see the house of our dreams we should go for it.

SO: I am going to shop around for the best mortgage deal.

I am going to improve our credit rating (it's not terrible BUT not as good as it should be because they haven't got us on the eletoral roll (I've got a certificate confirming we are through his morning adn will send it to the 2 credit ref agencies who don't think we are, and they haven't got all my credit cards, prob because they've all been moved to 0% so they think I am utilising a high proportion of my available credit limits, which I'm not

I'm going to keep proving how much we can save

I'm going to go and take out redundancy insurance

I'm going to swallow my pride and accept and cash FIL offers (I have been saying no to this)

It really crystalises things posting here sometimes, doesn't it?

I will indeed post a picture of dd's pink bedroom when we've moved and painted it.

OP posts:
Original poster
WideWebWitch · 11/08/2007 08:29

And oi, CD, I did email you again, please tell me if you got it.

or email me, realfirstname.realsurname at g ma i l d o tcom

OP posts:
CountessDracula · 11/08/2007 12:45

hey www
didn't get it but have emailed you xx