MORTGAGES

Mr. Pickle · 23 Sep 2013 at 19:09

Anyone got any advice on mortgages? If I took out a mortgage of 100k how much would I end up paying back overall and per month. Someone just give me a run of the mill figure?

Should I really be bothering buying an apartment if I can't buy it outright right now?

I remember back in the day a house 3x your salary was considered normal or something, now Im looking at 60m2 apartments for 4 or 5 times my salary. What went wrong?

SDK^ · 23 Sep 2013 at 19:12

How much deposit do you have and what is the value of the house . That (loan to value) determines the Mortgage offer you can get.

Orch · 23 Sep 2013 at 19:13

1. Go and see an Adviser.

2. Depends on the loan to value ratio, and therefore the rate you can achieve.

3. You'll pay back lots more than you borrow. Lots.

4. That would be nice. Something out of most peoples reach though.

5. House prices rising faster than incomes went wrong.

Mr. Pickle · 23 Sep 2013 at 19:18

SDK^ said:
How much deposit do you have and what is the value of the house . That (loan to value) determines the Mortgage offer you can get.

Its prob around 100k and I can get probably 30k deposit

Captain · 23 Sep 2013 at 19:18

SDK^ said:
How much deposit do you have and what is the value of the house . That (loan to value) determines the Mortgage offer you can get.

Didnt realise there was someone else from redditch on here! what area?

SDK^ · 23 Sep 2013 at 19:39

Mr. Pickle said:
Its prob around 100k and I can get probably 30k deposit

So you're looking to borrow £70k then?

On those terms HSBC will provide a mortgage for £70k (LTV of 70%) over 25 years for £303 per month. With an interest rate of 2.19% fixed for 2 years.

You also need to factor in any Mortgages fees; some deals have booking or arrangement fees to be paid upfront.

Clov!s said:
Didnt realise there was someone else from redditch on here! what area?

I live in Wirehill

Orch · 23 Sep 2013 at 19:50

SDK^ said:
So you're looking to borrow £70k then?

On those terms HSBC will provide a mortgage for £70k (LTV of 70%) over 25 years for £303 per month. With an interest rate of 2.19% fixed for 2 years.

You also need to factor in any Mortgages fees; some deals have booking or arrangement fees to be paid upfront.

I live in Wirehill

Not a brilliant example tbh, just a low rate. Sticking with HSBC for a second, you'd be better off with the fee free 2.49%.

SDK^ · 23 Sep 2013 at 19:54

Orch said:
Not a brilliant example tbh, just a low rate. Sticking with HSBC for a second, you'd be better off with the fee free 2.49%.

Of course - they may need a HSBC current account to qualify for that, depending on the offers HSBC are offering.

There are literally millions of deals - you will need to do your research to find the best deal for you.

gort · 23 Sep 2013 at 22:07

Just chuck in a few figures here for a quick estimate.

Plenty of other calculators online as well as ones that show overpayment figures.

ci_newman · 24 Sep 2013 at 09:29

I wish I could have a mortgage of £100k and repayments of £300 / month

That buys you a cardboard box in my area

boxman2000 · 24 Sep 2013 at 09:52

Actually, I would be careful dismissing the arrangement fee option.

We've just re-fixed for 5 years (HSBC) and where it used to pay being an 'Advance' customer (giving you a 0.XX% discount) it is no longer the case, although they do require for you to open up a bank account I believe.

Secondly, do some quick sums to see whether you will save overall for both arrangement and fee free options. We went for the arrangement fee option and where as we had to pay £2k arrangement fee, we are actually saving an additional £700 over the 5 years, i.e. saving £2,700 interest in 5 years, in effect making 35% over 5 years, or 7% per annum.

You won't get close to 7% on a deposit of £2k. I appreciate the £2k is an inital outlay but just work out how much saving £2k would give you if you paid that as part of your deposit (reducing capital) as it could well work out cheaper.

Lesson is to do your homework but make sure you ask the right questions from the mortgage provider.

ci_newman said:
I wish I could have a mortgage of £100k and repayments of £300 / month That buys you a cardboard box in my area

Cheapest bedsit you can get here is £240k+ so count yourself lucky you could get a cardboard box for £100k!

Syla5 · 25 Sep 2013 at 11:57

http://www.drcalculator.com/mortgage/uk/

use that, all sorts of adjustments you can do yourself

div0 · 25 Sep 2013 at 12:12

Mr. Pickle said:
Anyone got any advice on mortgages? If I took out a mortgage of 100k how much would I end up paying back overall and per month. Someone just give me a run of the mill figure?

To borrow £100k (over 25 years):

Assuming 3% interest; you'd pay back roughly £475 per month and £142k total.

Assuming 5% interest; you'd pay back roughly £585 per month and £175k total.

Assuming 8% interest; you'd pay back roughly £772 per month and £232k total.

With a 30k deposit, the 3% interest numbers should be a decent guideline, but I've included the others because at some point in the next few years the rates are likely to rise, seeing as we've been stuck at a historical low for a while now.

Syla5 · 25 Sep 2013 at 15:10

div0 said:
To borrow £100k (over 25 years):

Assuming 3% interest; you'd pay back roughly £475 per month and £142k total.

Assuming 5% interest; you'd pay back roughly £585 per month and £175k total.

Assuming 8% interest; you'd pay back roughly £772 per month and £232k total.

With a 30k deposit, the 3% interest numbers should be a decent guideline, but I've included the others because at some point in the next few years the rates are likely to rise, seeing as we've been stuck at a historical low for a while now.

Your calculations are great, but why not just use the calculator i linked above, so that no guessing between interest rates is required?

Glaucus · 25 Sep 2013 at 15:21

You wouldnt pay anywhere near that per month. So a calculator would be far better.

grimm · 25 Sep 2013 at 15:27

See an adviser.

div0 · 25 Sep 2013 at 15:31

OP asked for a 'run of the mill figure' - I assumed for what ever reason, he either didn't understand how to use the numerous online calculators, or just couldn't be bothered.

Either way, I just tried to answer his question and keep things as simple as possible, so that he got the 'run of the mill' figure he was looking for.

Glaucus · 25 Sep 2013 at 15:33

Thats fine but with 3% it would be more like 340 a month and 8% more like 540 a month.

Oh you did 100k not 70k.

Nvm I'll go disappear.

div0 · 25 Sep 2013 at 15:42

Glaucus said:
You wouldnt pay anywhere near that per month. So a calculator would be far better.

Borrowing 100k, with 30k deposit is just over 75% LTV - so he'd probably be looking at mortgages of 80% LTV, unless he can save a bit more.

Having a very quick look, the best he could expect is about 2.5% interest rate.

I suggested my 3% numbers were a good 'run of the mill' guideline for him and they won't differ that much from 2.5%.

Assuming 2.5% interest; you'd pay back roughly £450 per month and £135k total.

So not much difference from what I already told him.

/edit

Just saw your update. Yeah I did it for borrowing 100k because he said:

If I took out a mortgage of 100k how much would I end up paying back overall and per month.

No idea why some people have been quoting for £70k

Unless they assumed he meant he was looking to buy a property valued at £100k.

Glaucus · 25 Sep 2013 at 15:44

Because of this, and you don't usually say 100k mortgage + your deposit. A mortgage you usually say 100k of which you'll put x down.

Mr. Pickle said:
Its prob around 100k and I can get probably 30k deposit