Mortgage at 50, worth it or not?

Uther

Uther

Uther

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Some background:
We have always rented, and the rent is currently around £400 a month (housing association) and to be honest have never had a problem.
We are going to come in to some money in the next few months, due to inheritance, which is looking to be around £70000.
A quick look at mortgage calculators, a 100k house with a 30k mortgage at 3.4% over 15 years is giving figures of around £210 a month.
So, if I am reading the figures correctly we could be mortgage (and rent!) free in 15 years max, as well as paying half what we are paying now. I would be 65 then :(
Worth looking in to or not GD?
 
It's worth considering. But why 15 years? better to make it 10 and be rent/mortgage free at 60. Repayments would be similar to your current rent.

Is it realistic to get a £100k house in your area?

Obviously, owning throws up extra maintenance costs, which need to be factored in
 
If you can do it then go ahead it's got to better then renting when your in 70's and not able to work full time and having to worry about what would happen if your landlord sticks up the rent .
 
Owning is always worth looking into.

In your case, it looks rather tight ideally you should be rent / mortgage free by 60 which then allows you to build a nice egg in savings for your retirement.

Remember that mortgage rates are changeable and could increase during your repayment period so £210 may not be the real figure over the term.

How about reducing the term and changing the rate to something like 5%-6% to see if you can afford to have the mortgage
 
The Geezer said:
Owning is always worth looking into.

In your case, it looks rather tight ideally you should be rent / mortgage free by 60 which then allows you to build a nice egg in savings for your retirement.

Remember that mortgage rates are changeable and could increase during your repayment period so £210 may not be the real figure over the term.

How about reducing the term and changing the rate to something like 5%-6% to see if you can afford to have the mortgage
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Ten years at 6% =£333, still cheaper than the rent.
 
25k over 5 years on a personal loan should be not much more than 400/month. Might have some expenses (boiler, roof) during those 5 years but probably not. Repayment could not go up at least.

So long as you still have a few hundred/month after bills and loan repayment I'd think you were okay.
 
I would personally buy, but that's my own opinion. I can see variable mortgages as low as £188 per month with a 15 year mortgage. Maybe a good plan would be to retain your existing rental payments and clear your mortgage in 7 years.

On the other hand, you may just want to spend the money and keep renting. If you have no provision for your retirement, having 70 grand to draw down might be worth considering, assuming your housing association tenure is secure.
 
Always worth it in my opinion. Worse case you can sell it for more than you bought it and go back to renting (obviously with the rare exception of a housing crisis, but even then it does not take long before it is back up to original price), best case you own a house :)
 
mulpsmebeauty said:
On the other hand, you may just want to spend the money and keep renting. If you have no provision for your retirement, having 70 grand to draw down might be worth considering, assuming your housing association tenure is secure.
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It's unrealistic to get over 8% I think, risk free, and anything less would see him lose to paying rent / inflation.

If he could get 4% he'd be flat broke in 20 years with no asset or capital.

If he bought now, and paid off as quickly as possible (lets say 7 years but could be less) then he can save £400 a month for 13 years and having a house worth , lets say, 130k by retirement.

If he saved the £400 religiously without dipping in, he could be looking at 70k in cash and a paid off house by 65. That's not bad.
 
I think its worth it, you would have your own home for not much outlay, you will pay less than your rent, on the flipside you can keep renting but in 15 years time your tsill renting, whereas in 15 years time you would have your own home, its investment and something you can pass along to your kids etc. Or you can use your inheritance cash to do some fun stuff like travel the world etc.
 
Dave M said:
It's unrealistic to get over 8% I think, risk free, and anything less would see him lose to paying rent / inflation.

If he could get 4% he'd be flat broke in 20 years with no asset or capital.
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It depends on his other provisions for retirement and his expectations. If he has enough household income post retirement to pay rent, bills and socialising, then having 70k will pay for holidays every year. If it's gone in 20 years, that would potentially be the point where frailty limits his ability to spend, thus falling back on his fixed income.

On the other hand I'm with you - get and clear a mortgage as quickly as possible, without impacting his current lifestyle. The problems can arise when that 140k house looks so much more appealing than the 100k house and he ends up with a 70k+ mortgage at the age of 50, when his current income may not be secure.
 
asteldian said:
Always worth it in my opinion. Worse case you can sell it for more than you bought it and go back to renting (obviously with the rare exception of a housing crisis, but even then it does not take long before it is back up to original price), best case you own a house :)
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That is far from the worse case scenario. That is best case scenario really.

Worse case would be a collapse in housing prices and j Teresa rates hitting double digits. Actually worse. Add is something like an ex-wife burns the house down and that isinsurance insurance
 
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