[adriano]

Hi all,

I'm after some advice, it's nothing to do with motoring though, so not entirely sure that i'll get any replies.

I'll be hitting that ripe old age of 30 soon, it does'nt seem that long ago since i left school (god!! i feel old) the other day i was shaving and i noticed that i've got b*oody nose hair

what's all that about then, and i have noticed that i complain a lot more now........

Anyway, sorry about that, back to the point Mortgage's i've now realised that i'm not getting any younger and that i want my own place and i need to settle down, after spending my money on naff all over the year's, and, other people doing a good job of spending my money (but, i won't go into that) i've realised that i need to get a mortgage sorted out sooner rather then later, it makes me wish that i was more like my dad, he started his mortgage when he was a young man and therefore paid it off a lot quicker, anyway, the problem is, i don't really have a clue when it comes to mortgage's, well, ok i've got a very very basic understanding of them, but when it come's to mortgage "speak" then my mind goes blank.

The reason why i'm asking this here is, that saab scene has a lot of member's and after being one now for a few months, i've realised that you lot know what your talking about, and that's regarding all stuff, not just your excellent knowlegde of the good old saab.

So, i suppose what i'm after is some advise on who does the best mortgage, who to avoid, who to speak too, etc etc.

My situation is, as follows~

First time buyer
Excellent credit history (i hope)
No loans
Full time employment

I know this is an odd posting, so fully understand if no one replie's or if the moderator's decide to remove it.

Any advice/help/tips greatly appreciated.

Tia

Ade

 

[cdcarlsson]

OK, I'm certainly not in the finance industry, let's clear that one up straight away.

Point One. Get some advice (OK, I know you're doing that here). It will almost certainly be biased. So...

Point Two. Get some more elsewhere (Try the 'Fool.com' website for a start), then get some more (say your building society/bank).

Put all this together and make your own mind up. Remember anyone can get it wrong, even the pro's (endowment policies anyone... )

Ok, my advice.
Rates are as low as they'll probably go. They might go down a bit, but they could go up a lot (15% APR in 1992?) I've fixed my rate for ten years, this type of deal might not be available to a first time buyer, but look around it might be...especially if you have a large enough deposit (you have got a deposit, right?).
Get a flexible mortgage that can move with you when you move house and doesn't give you penalties for doing so.
If you want to be like your dad and get over this mortgage thing quickly, then find a mortgage that allows you to make overpayments (without penalty). Any overpayments you can make in the first few years help out in reducing the length of the repayment. Oh yes, I'm now on a straight repayment policy, ahem.
Well, that's about it. Find something that does you all the favours not the bank/building society. If you can bide your time (whilst saving up that deposit?)and keep looking 'special offers' crop up from time to time as various finance institutions have a certain amount of cash that they can let go at preferential rates.

Oh yes, if you are self employed, everything changes, as you can make all sorts of other types of mortgage work for you, for this you really need a financial consultant, I'd recommend one anyway (even though one I had through a local estate agent tried to get me to sign up for an expensive deal with his old firm, and wasn't too happy when I found a better deal on the 'net... happy days).

Good luck.
Nick.

 

[AdamH]

It's worth having a look at Money Saving Expert. He's very good at filtering out jargon.

Best advice is probably to find an independent financial advisor. Any bank or in-house broker can only give you biased information.

 

[msteers]

It would be worth speaking to London & Country (recomended in the Daily Mail money section) - they got us a brilliant deal when we decided to move our mortgage recently.

 

[1989agoodvintage]

I'm also a first time buyer in the midst of house hunting. It is a pretty soul destroying business at the moment.

(you have got a deposit, right?).[/b]

Good point, I thought that given the fact that money lenders are falling over themselves to give customers loans and credit cards it would be easy to get a 100% mortgage. No so, Barclays for one (reselling Woolwich packages) require a minimum 5% deposit. Also, lenders who will give you more than 95% will usually hit you with a hefty charge for doing so and may not offer the best deals. In addition I've been advised by friends that taking out a 100% mortgage will mean that your home insurance premium would be pretty nasty as well.

Hence I'm currently living on a shoestring.

 

[adriano]

Originally posted by cdcarlsson:
[qb](you have got a deposit, right?). [/qb][/b]

Yes! of course i do

But , a "friend of mine" who is in the exact same position as me, Has'nt got a deposit What would your advise be for him?

Thankyou all, for your great advice, again, like i said before, you lot know what your talking about.

The problem is, and i'm gonna be honest here, it's scare's the bejesus out of me, i've had loans before 10k over i think it was 5 years, so i'm no stranger to borrowing and paying back, but that was 5 year's, but a mortgage 25..30 year's i'll be b*oody 60 when it finally get's paid off.

But, i suppose everyone feels this before they sign there live's away (or is it just me?) but anyway, it's something i need to do so there's no point moaning about it

There is one other problem though, where i live the house price's are stupidly high for a one bedroom "shoe box" your looking at about 90 to 100 grand, so, that well and truely price's me out, so it's looking like i'm gonna have to move away, that might mean that i have to... (before i say it, a quick warning, i'm going to use some bad language now, moderator's feel free to edit this bit if you find it's to offensive-if there are any young children here please leave) ok, here it come's- sell the saab and get something more economical.

I would just like to apolagise for my outburst there, i hope i did'nt cause any offense- a help line has been set up for people who can't cope with what they just read...

I'm going to give my bank a call on tuesday (abbey) and have chat with them and see what they say, at least now i can tell them roughly what i want, after reading your replies, rather then them telling me what i want and me just agree'ing with them.

Ade

 

[nikainsworth]

I used to work for a bank and while I was supposed to recommend our own Mortgages, in all honesty, I recommended people to a mortgage arranger in Mirfield with a business called Mortgage Talk. Can't remember the phone number but have a look on yell.co.uk and see what it brings up. He knows his stuff, (didn't pay me to say this either!), and has sorted out more than a few people in your situation. Hope this helps.

 

[mpen]

This is money This is one of the best sites for all your money needs.....Advisers seem to drive nice big expensive cars, your paying for that when you use them. One of my friends sorted out a 50k mortgage for me around 18 years ago, he gave me £600 and said I don't make money off my mates, you don't need to organise many of those a week to make a good living.

 

[1989agoodvintage]

But, i suppose everyone feels this before they sign there live's away (or is it just me?) but anyway, it's something i need to do so there's no point moaning about it[/b]

You just have to be optimistic and trust that Interest rates will not be allowed to skyrocket as they have done in decades gone by. That way, in 10-15 years your income should have increased to the point where your current mortgage repayments are well within your limits and you can look to pay off a little more with the aim of shortening the term of the mortgage. Assuming you will not have a need to up-size that is.

 

[BigMark]

I'll add my 2p, in.
Firstly I agree, speak with an INDIE financial adviser.
I have a CAT mortgage link at .5% max above base.
The interest rates will NEVER be allowed to sky rocket as they did in the 80's as the BOE control them now not the government trying to get votes.
Move yourself up T' North, you can get a nice two bed semi for 85K! in Wigan

 

[BigMark]

Oh and dont sell the SAAB, you'll regret it!!

 

[adriano]

Hi all,

Again, thanks for the great advice from all of you

I went out in the car today, it gave me a chance to be on my own and think about what i want to do, where as i'm desperate to get my own place and get my first step on the mortgage ladder, i'm also very worried about getting many thousands of pounds in debt, i know all of you here have done this and therefore are saying just do it don't worry about it, but, the problem is i'm worry'er alway's have been, and i keep thinking to myself, well what if i loose my job (were not very busy at work at the moment).

It's like what jason torque steer said, he's now living on a shoe string.

Anyway, armed with all this advice from you guy's, i'm going to start doing my home work, and see what's available for me out there.

I have to admit though after going out in the car today, i don't want to sell her, i really don't

Whilst sat at the computer typing this reply, i have just seen the biggest hairyest ugly'est spider crawl along my wall, b*oody hell, he's a big b*gger

Big Spider

 

[sgould]

Think of it as a big money spider

As long as the property market doesn't collapse, the house will be its own security.

Just accept that you will be poor until you retire. House/marriage/bigger house/kids/holidays/kids weddings etc.

I speak as someone who has been through it and paid off the mortgage

.......then I bought an Aero

[edit] At one point on the 70's the bank rate went up so much that I was paying 55% of my take-home pay as mortgage

 

[Qbert72]

The first time is always like this mate, but trust me when I say that theres nothing to worry about. A mortgage is not for life it is for a short time in reallity.
Unlike previous decades where Mr & Mrs Happy bought a house, took a morgage out and lived there happy ever after paying off the mortgage and dying happy.
Now the rule is buy a house and either move within 10 years or at least remortgage sooner than that.
Therfore it isn't a problem as it is a 5 - 10 year loan at lower repayment terms than you can get elsewhere. I am in my 2nd house and over these 8 years I have had 4 mortgages, 2 new and 2 remortgages. Because interest rates change so much it makes sense to chop and change. Just like credit cards with 0% balance transfers etc...
A few things I look for are deals where there are no penalties for early repayment, this is the main area for loosing money. A low fixed rate based on the variable base rate is usually a good safe bet. As a first time buyer you should have access to the best deals so shop around. As for the deposit a little tip from me is to tell all concerned you have the 5% deposit ready. (until you find a house and the wheels start turning you wont know how much you will need anyway). Then once the time arrives to complete the process and pay the deposit, go to your bank and take a loan out for the required amount over a 3-5 year term. This would be based on the mortgage deal you took out. So in either 3 or 5 years you can remortgage and pay off the other loan then.
I used this on my first house but took the loan out over 10 years to reduce the payments. It worked out that the cost of the monthly mortgage repayment and the loan repayment was less than a 100% mortage.

 

[adriano]

Originally posted by sgould:
[qb] 
[edit] At one point on the 70's the bank rate went up so much that I was paying 55% of my take-home pay as mortgage      [/qb][/b]

That's what worries me the most, just spending the rest of my working life paying off a mortgage, i don't have any kid's, but, if any do come along then i've got kid's and mortgage to pay for

Why can't i be 16 again, where the only thing i had't to worry about was trying to convice my mum that the reason why she can smell booze on my breathe is, i thought i was drinking coke i did'nt know it was guiness- Honestly mum, that's the truth

 

[sgould]

Yes but interest payments seem more under control these days.

 

[AdamH]

Originally posted by ade9000:
[qb] QUOTE

Originally posted by sgould:
[qb]  
[edit] At one point on the 70's the bank rate went up so much that I was paying 55% of my take-home pay as mortgage    

  [/qb][/b]

That's what worries me the most, just spending the rest of my working life paying off a mortgage, i don't have any kid's, but, if any do come along then i've got kid's and mortgage to pay for [/qb][/b][/quote]But if you don't buy a house and get a mortgage, you'll be paying rent which means you're paying someone else's mortgage.

Or, look on it the other way: if the mortgage payments get too much for you, you could sell the house and go back to renting. With a bit of luck house prices will have risen and you'll actually make some money.

 

[Mark R]

As a Housing Manager working in public sector housing that last piece of advice is the best.

"But if you don't buy a house and get a mortgage, you'll be paying rent which means you're paying someone else's mortgage."

However, "Or, look on it the other way: if the mortgage payments get too much for you, you could sell the house and go back to renting. With a bit of luck house prices will have risen and you'll actually make some money."

Risky. Lots of areas of the country are seeing reducing property prices or stagnation. London - for example - can't attract firefighters. Property too expensive at too many times annual salary.

Eventually noone can afford to enter the market so prices will readjust. Wage increases are not matching house price inflation so be careful you don't get burnt relying on prices increasing at a high percentage value forever. The market readjusts siginficantly every few years or so and though the long term trend is upwards you have to be able to afford to see through the hard times.

However there's a good deal of sense in the earlier posts.

First up, renting. Rents on average almost always increase, in the public sector by a minimum of inflation plus typically 1% or so year on year, in the private rented sector much more so.

You are definately subsidising someone else's mortgage. Getting a cheap Housing Association or Council property is unlikely if you are single.

And the key. For the rest of your life in either sector you pay ever increasing rent year on year and have nothing to show for it in 30 years time. No equity release possibilities - nothing.

A mortgage is a struggle - especially in the first years - but in effect the increase in property vcalue through the years (and hopefully your salary increases) means the proportion of your net (take home) salary expended on housing costs reduces - rather than increases as it would if you kept renting.

100% mortgages are expensive - you pay a fee on top - and some lenders will go to 120% even - but with interest rates this cheap it is still better value in most cases than renting assuming you can get a mortgage. Even cases 5 yrs back that had no chance - poor history or not enough multiples of earnings can now get mortgages relatively easily.

One word of caution though - or maybe more than that. First, interest rates can fluctuate. I do not agree that double digit inflation is unlikely ever again. I think 4-8% as the range is the likeliest in the next short to medium term based on the last 5 or so years. Take - if you can - a short term 2 or 3 year fix and try to avoid tie in penalties after the fixed period.

A 2 year is the best fix - reasonable enough to benefit from good rates now but short enough to move out of quickly without too much penalty if rates improve and likewise with a soft landing if they get worse.

Finally - never ever borrow more than you can afford. Same in terms of rent. I can assure you of one thing if you get it wrong - and don't get both professional advice before committing (or talk to the landlord/lender if you get problems paying) they will evict you or reposess your house. Seriously - I have had to do repossessions more than once and it is deeply unpleasant. For the same reason always avoid additional loans secured against your home over and above a mortgage.

Hope this is of help to you and others.

 

[Mark B]

Originally posted by BigMark:
[qb]Oh and dont sell the SAAB, you'll regret it!! [/qb][/b]

The best piece of advice yet.

 

[adriano]

Hi all.

It's been great reading your replies and very informative and very helpfull, thank you

But, to be honest i'm not entirely sure how much longer i'm going to have a job, work is very slow at the moment, and, getting slower it's a shame because after reading your replies i was actually looking forward to getting out there and see'ing what's out there for me.

I try my hardest to go through life having a laugh and a joke, no matter what life throws at me, but for the first time i'm actually quite worried.

But, let's be honest here getting a mortgage when your almost certain that you are going to lose your job is a very stupid thing to do, ok perhaps i'm being a bit silly, the problem is we just don't know when, it could be next week it could be next year, we just don't know (do i take the risk )

Anyway, i've taken up enough off your time, hope you don't mind me sharing my problem's with you

Back to the real reason why were all here.....SAAB'S

Thanks

Ade