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Original poster

Too unrealistic?

15 replies

ricepuddingish · 21/07/2011 10:18

our deposit on a new house would be £235k. Is there any way of being able to offer on a house that's on the market for £465K. Was thinking it might go for £445? OUr combined income is £43k. I think I know the answer is yes It's impossible but just wondered what you thought?

OP posts:
narmada · 21/07/2011 10:34

A good broker may very well be able to find you a mortgage of the size you require given the amount you've got as a deposit. I found John Charcol to be very good but they do charge a fee. London and Country have more mixed reviews but don't charge an upfront fee (presumably they take a commission instead) and it's them we've ended up going with in the end.

As a comparison, we have a single income of just over £50,000 and are in the process of applying for a mortgage for £260,000. We haven't got our final decision yet, mind, although it was agreed in principle. Our deposit's slightly less than yours. We had an offer in principle from NOrthern Rock for that amount, and the rate wasn't too bad at all.

irregularegular · 21/07/2011 10:50

You might be able to get it, but are you sure you would want to? It doesn't seem to leave you much over. I know this is a bit obvious, but don't forget that interest rates can go up.

Different if you are confident that your income will go up in the near-ish future, of course.

thisisyesterday · 21/07/2011 10:54

i very much doubt it. unless perhaps it's interest only.

i think you'd be silly to push yourselves that far though tbh

we had an income of around £50k when we got our mortgage and the max we could afford was a house of £170k. that was with a 10% deposit, so mortgage of £153k
we now can't do anything or add to the mortgage because they will no longer lend over 80% of the value and we are only just under that now.

do you need a big house? or are you just in a very expensive area? could you not go for a £100k mortgage? that is very doable and would give you £335k to spend on a house which isn't unreasonable

Original poster
ricepuddingish · 21/07/2011 11:27

interesting to hear it is possible but probably for us we'd be stretching ourselves for a larger house that isn't a necessity. We don't live in the South and there are cheaper house but it would be my absolute dream house but totally not needed. Part of me thinks we should batten down the hatches and go mortgage free. Another part of me thinks we should aspire to bigger mortgage bigger house as we have no pension plan so our only plan would be to invest in our home and sell it when we retire.

OP posts:
Original poster
ricepuddingish · 21/07/2011 11:43

Wow have just done Northern Rock and a £210k mortgage would only be £990 or so a month on 2 year fix. Scary to think what it would be though if rates went up though.

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thisisyesterday · 21/07/2011 11:49

blimey. ours is £875 a month for a £153k mortgage

I would LOVE to be mortgage free. i think.
i'd rather have a smaller (but still very nice) house and then just have all that extra cash to DO stuff with.

Original poster
ricepuddingish · 21/07/2011 11:50

As a comparsion we have a 10 year fix at 4.75% and we pay £770 a month.

OP posts:
TheCrackFox · 21/07/2011 11:57

Is that an interest only mortgage?

Original poster
ricepuddingish · 21/07/2011 12:17

No fox ours is repayment. Obviously paying over the odds for peace of mind.

OP posts:
Gonzo33 · 21/07/2011 14:03

If I am honest it is all very well for people to give advice here, but they do not know your full circumstances. You should see an IFA before you make your final decision.

Original poster
ricepuddingish · 21/07/2011 15:36

Thanks Gonzo - not really in a position to do anything yet. It's I saw this dream house and starting wondering if it would be at all possible.

OP posts:
minipie · 21/07/2011 15:57

"Scary to think what it would be though if rates went up though"

Interest rates will go up. There is only one way for them to go, they're at rock bottom at the moment.

Seriously, even if mortgage rates are only 2.5% at the moment, you need to work out if you could still afford the amounts if rates were 4.5% or even more.

Original poster
ricepuddingish · 21/07/2011 16:23

Thanks minipie. "Interest rates will go up." This is exactly why we got a 10 year fix at 4.75%. At the moment tho it doesn't look like any increase is likely till 2014 (read it in the papers today so it must be true!) but who knows?

OP posts:
Gonzo33 · 22/07/2011 13:23

I think that is unlikely that rates will hold that long. They may not rise much but I do think they will rise over the next 3 years.

cjbartlett · 22/07/2011 13:27

I'd go mortgage free if I were you
Think then how much you could save a month for a rainy day, for pensions, care for parents, tuition fees etc etc

It's the dream isn't? Mortgage free? I'll be 65 when we're mortgage free Sad

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