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First Mortgage...

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Me and the other half as long as everything goes ok, as i am trying to transfer my law degree down to London from Coventry, then we shall be better off financially. Thu we were going to save some m… Read More
awoodhall2003 Avatar
8y, 3m agoPosted 8 years, 3 months ago
Me and the other half as long as everything goes ok, as i am trying to transfer my law degree down to London from Coventry, then we shall be better off financially.

Thu we were going to save some money up to maybe in a couple of years put a deposit down for a property and get a mortgage...however we are now thinking that we know if we have the money we will use it for things like holidays and improvement etc.

So our latest thought is to maybe go straight into a mortgage and not save. Thus i would like some advice as i am only 21 and she is 20, i am currently a student and as long as i manage to transfer my income per annum will be a minimum of £8k (not much i know) and as long as she gets the job she just been interviewed for and theyre chasing up references she should be on £18k (for a level entry job!).
So a total £26k pa.

We shall be living in a home where my other half looks after a family member and thus do not pay any rent, any electric or gas or phone bill. Thus the only bills will be food, sky, mobile phones.

So as you can guess were not looking to live in it, but to buy to let.

So my questions to all that can help/advise...
what sort of mortgage do you think we could get?
what do we need to consider?
what sort of deposit?
is a shared ownership a good idea?
anything else?
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awoodhall2003 Avatar
8y, 3m agoPosted 8 years, 3 months ago
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1 Like #1
you need a buy to let mortgage which is normally a slightly higher rate than a private one
but you will get tax relief for this
you need good tennants (to make sure they dont wreck the place and pay the rent).
insurance and saftey checks for gas and elec.
normally a 25% deposit is required you need to have a word with your bank manager
i dont know about shared ownership i dont know if they would allow you to let it out
if you can get the rent to cove mortgage insurace and other bills and house prices start to rise you should be onto a winner.
1 Like #2
what sort of mortgage do you think we could get? Any really, but anything over 90% loan value will be tougher
what do we need to consider? How much you can put down
what sort of deposit? 10% + ideally
is a shared ownership a good idea? No
anything else? . . . . . .

3 yrs ago (and this was BLIND luck) we took a 100% mortgage fixed for 5 years with Northern Rock, looked a poor decision after 12 months but doing ok now! Just get on the ladder m8 - just don't break yourself payment wise . . .

Best of luck to you both though!!!
#3
good luck
#4
the sedge;4891431
you need a buy to let mortgage which is normally a slightly higher rate than a private one
but you will get tax relief for this
you need good tennants (to make sure they dont wreck the place and pay the rent).
insurance and saftey checks for gas and elec.
normally a 25% deposit is required you need to have a word with your bank manager
i dont know about shared ownership i dont know if they would allow you to let it out
if you can get the rent to cove mortgage insurace and other bills and house prices start to rise you should be onto a winner.

right tax relief...how excatly does that work?
good tenants tbh is all luck and ensuring they seem alright.
id thought of insurance already, and luckily my girls uncle is fully registered and qualified builder, plumber, electrician :thumbsup:
25%? mbgringo below got 100% mortgage! or did you just mean ideally?
And yes that is what we were thinking if we could get even just rent to cover mortgage and the rest come from our pocket i think thats winner enough for ourselves...especially in todays climate!

mbgringo;4891462
what sort of mortgage do you think we could get? Any really, but anything over 90% loan value will be tougher
what do we need to consider? How much you can put down
what sort of deposit? 10% + ideally
is a shared ownership a good idea? No
anything else? . . . . . .

3 yrs ago (and this was BLIND luck) we took a 100% mortgage fixed for 5 years with Northern Rock, looked a poor decision after 12 months but doing ok now! Just get on the ladder m8 - just don't break yourself payment wise . . .

Best of luck to you both though!!!


So if we were to look at £125k (which was my guide price in my head, but only just starting to look into it) then a deposit of £12.5k would be good (eeek!) but i think it could be done, might have to get family to early inheritance (on her side, none of my family got any money!) or get them on a percentage of the house.

Why you say no to shared ownership? They sound good in theory...although so does communism! :-D
#5
Smeagol<3sDeagol;4891548
good luck


cheers dude :thumbsup:
#6
awoodhall2003
right tax relief...how excatly does that work?
good tenants tbh is all luck and ensuring they seem alright.
id thought of insurance already, and luckily my girls uncle is fully registered and qualified builder, plumber, electrician :thumbsup:
25%? mbgringo below got 100% mortgage! or did you just mean ideally?
And yes that is what we were thinking if we could get even just rent to cover mortgage and the rest come from our pocket i think thats winner enough for ourselves...especially in todays climate!



So if we were to look at £125k (which was my guide price in my head, but only just starting to look into it) then a deposit of £12.5k would be good (eeek!) but i think it could be done, might have to get family to early inheritance (on her side, none of my family got any money!) or get them on a percentage of the house.

Why you say no to shared ownership? They sound good in theory...although so does communism! :-D


Actually got a 110%, but equity (even now) means we're in the black . . . .


Shared ownership? Hmm, i'd rather rent for a while and save up than have the millstone of a mortgage AND rental round my neck . . . .
#7
is a shared ownership a good idea? if it's all you can afford..
anything else? Repayment! (interest only is for mugs):)
#8
mbgringo;4891652
Actually got a 110%, but equity (even now) means we're in the black . . . .


Shared ownership? Hmm, i'd rather rent for a while and save up than have the millstone of a mortgage AND rental round my neck . . . .


Fair enough.

Maybe im incorrect about 50% ownership...but i just looked and seems i was...i thought the other 50% was held on their investment, but by seems of it they charge rent for their 50%...which thus seems a bit backward to be honest...as then you may as well take a 100% mortgage, even if on a smaller property!

Also were in SE London, so id imagine that it shouldnt be too difficult to find tenants i guess?
How much would you reckon a good first time buy we should be looking into? As i really have no clue whatsoever! Based on the income, as obviously they probably wont see myself as a good investor due to student although my income will be around £8k i believe minimum from loans and grants for university, but girlfriend will hopefully get a good job, and she also is working at a private dentist on a saturday for £12.50 per hour, its all a little more...and adds up.
#9
ctuk;4891674
is a shared ownership a good idea? if it's all you can afford..
anything else? Repayment! (interest only is for mugs):)


On your first point, by the sounds of it id be better off just going for a smaller property rather then going that route.

interest only would not be an option...its like people who have credit cards with APR in the 30%s and then pay minimum payments only...
banned#10
ide personally be wapping every penny i have into saving, saving for when you ready to buy a home to live in, yes you may get a buy to let mortgage but you'll be lucky to make enough rent to cover it, then theres the upkeep of it, if anything goes wrong its down to you, etc,etc
#11
sassie;4891739
ide personally be wapping every penny i have into saving, saving for when you ready to buy a home to live in, yes you may get a buy to let mortgage but you'll be lucky to make enough rent to cover it, then theres the upkeep of it, if anything goes wrong its down to you, etc,etc


Yeah this is true...thus why i dont want if this is the route i take to have very little knocking about, as i still want to live an ok life, and if an emergency happens i want to be able to cover it.

Like i said though problem is in saving, rates are down atm anyways, and thing is i can see ourselves turning round for example saying "oh thats a good deal on that holiday - well we got the money lets book it" and then use it for spending money as well...i do have self control...but im also quite spontaneous!
banned#12
awoodhall2003
Yeah this is true...thus why i dont want if this is the route i take to have very little knocking about, as i still want to live an ok life, and if an emergency happens i want to be able to cover it.

Like i said though problem is in saving, rates are down atm anyways, and thing is i can see ourselves turning round for example saying "oh thats a good deal on that holiday - well we got the money lets book it" and then use it for spending money as well...i do have self control...but im also quite spontaneous!


yes i understand what your saying, but if you really want to save for a future then you will. Getting as much behind you as you can will be a great start for when you ready to own your own home, savings may be pretty poor at the moment but nobody knows what will happen to interest rates in the next few years, you are too young to remember the 80's interest and it crippled may people, alot lost there homes, who knows if we could end up back there
banned#13
sassie
yes i understand what your saying, but if you really want to save for a future then you will. Getting as much behind you as you can will be a great start for when you ready to own your own home, savings may be pretty poor at the moment but nobody knows what will happen to interest rates in the next few years, you are too young to remember the 80's interest and it crippled may people, alot lost there homes, who knows if we could end up back there


Approx 1989 = 16%

Yes I remember!!!:whistling:
#14
sassie;4891807
yes i understand what your saying, but if you really want to save for a future then you will. Getting as much behind you as you can will be a great start for when you ready to own your own home, savings may be pretty poor at the moment but nobody knows what will happen to interest rates in the next few years, you are too young to remember the 80's interest and it crippled may people, alot lost there homes, who knows if we could end up back there


i remember the 80s...i was born in 87! oh but i dont remember it! lol :-D

Yeah that might be a simplier option for now, well that is your suggestion...so question for you, if we take that option...what would you suggest would be the best way to save it so that we get maximum interest, minimum tax, etc?
banned#15
guv
Approx 1989 = 16%

Yes I remember!!!:whistling:


was it that late, dont really remember as i didnt own my own home then, but friends of mine do remember it and say it was an awful time
banned#16
awoodhall2003
i remember the 80s...i was born in 87! oh but i dont remember it! lol :-D

Yeah that might be a simplier option for now, well that is your suggestion...so question for you, if we take that option...what would you suggest would be the best way to save it so that we get maximum interest, minimum tax, etc?


Im not really up on interest rates and the likes, but do know many places offer good interest for the 1st year of savings, although this is usually for savings of say £200 month for a year, so small amounts but over the year maybe more than lower interest accounts, as there two of you an account with each, after the year look into better accounts, maybe other can help out on this for you, good luck in whatever you decide :thumbsup:
#17
sassie;4891884
Im not really up on interest rates and the likes, but do know many places offer good interest for the 1st year of savings, although this is usually for savings of say £200 month for a year, so small amounts but over the year maybe more than lower interest accounts, as there two of you an account with each, after the year look into better accounts, maybe other can help out on this for you, good luck in whatever you decide :thumbsup:


Excellent cheers, i think we could easily look at saving £1k per month to be honest...but might work out best to have a smaller one each ie £200pcm and another for the rest...or even several £200pcm with different banks :-D
banned 1 Like #18
if you can be saving £1k a month i would deffo say get saving and dont buy yet, £12k a year is a massive start for a home in a year or so, good luck, get ya bum over to mse, the help on there is great for finances x

this sort of thing http://www.npbs.co.uk/families/regular-saver.asp
#19
sassie;4891918
if you can be saving £1k a month i would deffo say get saving and dont buy yet, £12k a year is a massive start for a home in a year or so, good luck, get ya bum over to mse, the help on there is great for finances x

this sort of thing http://www.npbs.co.uk/families/regular-saver.asp


Cheers sassie. And to everyone else so far, rep has been left for all that i believed have helped so far. :thumbsup:
#20
Normally on a Buy to Let mortgage you've got to put down a much larger deposit than on a residential mortgage.
Where I work, for example, you need 25% deposit on a BTL, or 35% if it's a new-build property.
#21
cheers, i think the way forward shall be savings accounts

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