Bigger mortgage cold feet

[Stad86]

I don’t know if I’m making a mistake

I currently have a nice home which suits our needs but is on a very busy main road where various garden walls have been knocked down by cars over the years. I have a 6 year old and it makes me uneasy as he gets older that one day he’s going to want to go out to the park or see his freinds and the road isn’t ideal for that.

I decided to see if I could sell my house and it got an offer straight away so I looked around for my house but in a safe place for the kids to play out and off a main road. To get a house of my size in a better spot means adding 170k onto my mortgage making it 300k.

I love the house I want to buy, I know it will be better for the kids and they can go to better schools but I just keep worrying about such a big mortgage. I earn around 80k a year and I have around 100k in ISA’s in case of emergency and I think it’s affordable with no other debt but being a saver it feels uncomfortable.

has anyone doubled a mortgage and had a similar feeling? I’m 40 so got a few years left working but just want to hear off other people how it felt once the stress of the move was over

Sounds ok to me - I assume mortgage will be about £1500pcm and you earn about £4500pcm?

in principle it sounds manageable AND the new home much better for you and your family, which alone has huge value.

How would you feel using £50k of ISA savings so your mortgage was less? you can then add monthly to build that back up.

Put some of your savings towards the deposit to reduce the mortgage amount.

I think the value the house will bring will be good for the family and the house has a large garage which will personally benefit me.

I could put 50k in which I think would reduce the cost by approx £350 per month, the reason I didn’t do that originally was due to uncertainty around the budget time with ISA’s and worrying about topping back up but nothing changed with all of mine being S&S rather than cash. I might revisit that idea.

I keep telling my self that most people I know have a car or two on finance and that pretty much equals what I’m adding to a mortgage but being a saver is really biting me in the butt mentally now.

Thanks for the reply

Yes that’s about right , I also take dividends out of my buisness quarterly which is growing 40% year on year but Iv based my calculations on my salary which is what I could reasonably earn if the buisness failed.

The new house sounds a better investment long term than the house you currently live in. More likely to increase in value in the long term as there will always be a demand for nice houses in quiet areas close to good schools. That is literally what every family wants.

But also a better investment towards your children's education and standard of living for all of you.

A bigger mortgage is always scary but within a few years the mortgage repayments seem more manageable than they did in the first year, due to inflation and hopefully higher earnings.

That’s a really good way to look at it

I spoke to my parents yesterday who at a similar age doubled the mortgage they had, that was from 30 to 60k which just seems crazy now but maybe I just need to let inflation do a bit of the heavy work for me and then just enjoy a nicer property

we've just doubled our mortgage. and we won't have any savings left... but I've just turned 40, we have no other debt, cars owned outright, and a decent income. i think things will be tighter but ok.

i think you sound like youre in a secure position.

Did you have doubts too? Did your move improve your life in terms of location or better schools?

well I haven't moved yet - couple of weeks to go. Kids staying at same (excellent schools) but we get more space and a rural type life rather than downtown antisocial behaviour type place. more privacy. yes doubts but without the debt i don't get my dream house so its that or suck it up in my current house (which ok, not bad, but not dream house).

I came on here thinking 'don't do it' (I'm risk averse) but in your circumstances I think I would.

If you leave it much longer you start to limit your options in mortgage length.

I'd take some out of savings and pick a mortgage good for overpayment.

I have a Woolwich mortgage where smaller overpayments (not more than 3x monthly payments) don't count towards the 10% a year. It means I can throw a few hundred at it whenever spare.

The Money Saving Expert overpayment calculator is good. You may feel better with a plan in terms of clearing it sooner but not committing yourself to large payments every month in the event of unexpected bills, holidays etc.