The nervous wait to exchange....

[HungryHippos]

My mrs earns ~ £18k base and then an extra £8k or so in bonuses. She was looking at a £180k house and using a £75k deposit she really struggled to get anyone to lend her the money. The ones who did all had high interest rates and fixed for 3 years minimum. Her only debt is a PCP for around £180 a month and a £50 phone bill.

I'd assume that would be manageable, unless they really aren't taking the bonuses into account properly. They like consistency I think so if the bonus isn't guaranteed they don't treat it as such.

My original mortgage was not on dissimilar terms to that, although my base earnings were a bit higher I didn't get any bonuses or extras.

 

[ChrisD.]

Yeah I always tend to use Nationwide, Barclays or Natwest to work out a rough idea on mortgage costs, their calculators are pretty simple to use.

 

[ChrisD.]

I'd assume that would be manageable, unless they really aren't taking the bonuses into account properly. They like consistency I think so if the bonus isn't guaranteed they don't treat it as such.

My original mortgage was not on dissimilar terms to that, although my base earnings were a bit higher I didn't get any bonuses or extras.

He problem was that at the time of application she had 2 or 3 months on long term sick, so most banks were really reluctant until she had 6 months of payslips showing full pay. Most lenders don't take her extra income as income as it's flight pay (she's cabin crew).

Thankfully in our situation, most of the big lenders will cover the sort of amount we want to spend on my income alone. But as above I'm not keen on being a slave to a mortgage into my late 50s.

 

[HungryHippos]

I'm 38 in a few months and I pay £1050 a month with 16 years left on my mortgage. My mrs and I want to buy together and for the sort of house we want that looks like it's going to go up to around £1300 a month but with 25 years left.

The other option is she buys into my current house and we could be mortgage free in around 7 years which would be a great position to be in.

The conundrum is difficult, nice big house but with a nice big mortgage, or a nice smaller house lacking some things we both want but be a slave to a mortgage into our late 50s/early 60s.

Regarding this don't get a mortgage that you can't afford, especially if it's one you can't afford on your own.

Spending a bit more time at the smaller house/overpaying the mortgage a bit will put you in a better equity position, so if/when you do upsize you will need a smaller mortgage to do so, and consequently pay less interest.

 

[ChrisD.]

Regarding this don't get a mortgage that you can't afford, especially if it's one you can't afford on your own.

Spending a bit more time at the smaller house/overpaying the mortgage a bit will put you in a better equity position, so if/when you do upsize you will need a smaller mortgage to do so, and consequently pay less interest.

I can afford it myself easily enough and the current house has quite a bit of equity in it.

The other thing I'm wondering about is when you're in a chain and want to use a new lender, are you stuck with paying ERC if the chain completes before the fixed period on the current deal or being stuck on a variable rate?

 

[HungryHippos]

I can afford it myself easily enough and the current house has quite a bit of equity in it.

The other thing I'm wondering about is when you're in a chain and want to use a new lender, are you stuck with paying ERC if the chain completes before the fixed period on the current deal or being stuck on a variable rate?

I actually had a similar situation recently. Moved into this house last August, but I had to complete my purchase 2 weeks before my fixed term ended as my buyer had a deadline to meet. My exit fee was about £2k on the ERC.

I ported my mortgage and it's remaining 2 week term over to my new house, then immediately set about trying to switch lender.

This was a headache for a few reasons and it was only by sheer determination that I solved it.

Problem 1 - Can't apply for a new mortgage at my new address when my ID documents don't match up, so I had to get a new driving license arranged ASAP to show my new address.
Problem 2 - Land registry hadn't updated to show I was the new owner of the property. This meant chasing land reg to sort it.
Problem 3 - The new lender saw my immediate mortgage exit as a sub-sale mortgage thing, which is basically where they don't like lending a mortgage on a property when it's only recently had a mortgage from another bank.

I had a lot of work to do to solve it, but in the end I spent about a month on the SVR before Nationwide finally agreed to sort it out. Still cheaper than paying the £2k exit fee to Natwest!

So in answer to your question, try and avoid what I had if you can. If you're in your fixed term deal when you complete then you may need to port it over to avoid ERC as that's calculated when you redeem it. If you're not then depending who the lender is, either stick on the SVR, get a new fix with them (then port that over) or try and get a tracker with them. Nationwide do trackers with no ERC, but from what I could see most banks had an ERC on their trackers.

 

[ChrisD.]

Did you post your ordeal in here? I remember reading about it, or perhaps it's just déjà vu?

Sounds like I'm stuck paying the ERC or being on the variable if I want to avoid porting. Variable isn't going to be great, because it could end up taking 4 months for arguments sake so that's going to be 4 months of well over 3%.

The issue is then also finding a lender that would cover a mortgage for the new house which I guess is risky.

The other option is to sell, put my stuff into storage and live at her mums for a few months until we buy.

 

[HungryHippos]

Did you post your ordeal in here? I remember reading about it, or perhaps it's just déjà vu?

Sounds like I'm stuck paying the ERC or being on the variable if I want to avoid porting. Variable isn't going to be great, because it could end up taking 4 months for arguments sake so that's going to be 4 months of well over 3%.

The issue is then also finding a lender that would cover a mortgage for the new house which I guess is risky.

The other option is to sell, put my stuff into storage and live at her mums for a few months until we buy.

Or try and arrange things so you can switch to a new lender prior to agreeing completion. Then you can just port the new lender mortgage across when you move, should be relatively painless that way.

 

[Fusion]

Jeez 35 years and 5% deposit?

Zero chance prices are dropping when these sorts of deals are around...

They aren’t around any more. Highest LTV Barclays offer is 85% (3.1% for 5-year fix seems the best rate at 85%).

 

[Junglist]

I should've said that ours was Help to buy scheme which is probably why it sounded better than it was, sorry for the confusion. So it's 5% us and 20% government loan we have to pay back after 5 years. (secretly hoping house prices plunge for 5 years so that we have to pay back less and then it bounces back up!)

 

[bloodiedathame]

Finally exchanged yesterday, moving date 2nd July. 6 months that's taken.

 

[xb8browney]

Congratulations

 

[Bug One]

Congrats. We're not likely to be moving till August now.

 

[fobose]

Regarding this don't get a mortgage that you can't afford, especially if it's one you can't afford on your own.

Spending a bit more time at the smaller house/overpaying the mortgage a bit will put you in a better equity position, so if/when you do upsize you will need a smaller mortgage to do so, and consequently pay less interest.

I totally agree with your first statement. Regarding the second though, if you stay in a smaller house for longer, you run the risk of missing out on the value of the property going up and it may cost you more in the long run. The bigger the house, the more it will go up (i.e 5% of 200k property vs a 400k property). Whilst the interest rates are low it would probably means you miss out on a lot.

I bought my first house for 155k (Aug 2010), sold 7 years later for 238k (Aug 2017). The people who owned my new house paid around £360k (Nov 2013) and I paid 500k ( Feb 2018). I wanted to be mortgage free so I stayed in my old house far too long and I actually think it cost me a lot in the long run.

 

[mid_gen]

While I don't think prices are in for a crash....the chances of significantly above wage growth price increases happening in the next decade are close to zero. I wouldn't be basing any buying decisions on the prospect of missing out on massive capital gains...

Another week gone here, over six months since having offer accepted. I was hoping to get moved while there was still some summer left but that prospect is fading by the day.

 

[mid_gen]

Well, some good news while I'm waiting for the sale....the local exchange was on waiting list for FTTC, and it's finally been connected, since I last checked. I was dreading having to put up with ~16mb dsl...

 

[The_Arbiter]

Well, some good news while I'm waiting for the sale....the local exchange was on waiting list for FTTC, and it's finally been connected, since I last checked. I was dreading having to put up with ~16mb dsl...

I've had that since forever, having actual fibre to the house when i eventually move is going to be quite a shock xD
I can't imagine what it's like being able to purchase a Steam game on a whim and actually play it the same day.

Rang the solicitor for an update the other day. Said they'd ring me back. Never did. Last time i spoke to them 2months ago they were blaming the other side for not getting any paperwork through. The "other side" is less than a 5min walk through town.

 

[Junglist]

Solicitors are making me hate the whole thing the most. They get fairly decent wedge of money and it feels like they do sweet FA to earn it!

Our Mortgage Brokers, who don't get paid by us, have gone above and beyond and made the entire process really easy - currently extending our mortgage application

 

[Skillmister]

Solicitors are making me hate the whole thing the most. They get fairly decent wedge of money and it feels like they do sweet FA to earn it!

Our Mortgage Brokers, who don't get paid by us, have gone above and beyond and made the entire process really easy - currently extending our mortgage application

Solicitors don't really get much in the scheme of things. They get far less than traditional estate agents and similar amount to online estate agents. They maybe get double the average broker fee? When you consider that agents have to take pictures, carry out some viewings and then mostly pretend to be "sale progressing" while actually just hyping people up and causing more stress.

Brokers have what a couple of application forms to fill out which you could do yourself?

Don't forget a significant amount of what you pay "the solicitors" isn't going to the solicitors, it's going to 3rd parties. Approx £300 for search fees, £1-200 for land registry and then all sorts of other nonsense especially where flats and new builds with management companies are concerned. All of which go to your solicitor but aren't actually their fees.

 

[Skillmister]

i cant aford that !
thats my monthly wage ! lol

When I bought my place 2.5 years ago I was on 19.5k and the max I could borrow was 92k. Which I did and bought for 107.5k. Payments were £335/m.

I remortgaged in Jan and my house was valued at 120k, I ended up borrowing 95k as I had some large purchases I wanted to pay off. Payments now 350.

You'll also likely need a 15% deposit if you want to buy any time soon as not many places are offering higher LTV right now.

I'm planing to stay for at least another few years maybe longer, probably dependant on whether or not I get into a relationship with someone I'd want to buy a house with. For now the low payments are ideal as far as spending money on other things goes