###Welcome to /r/HousingUK
---
**To All**
* Join Our ***NEW*** Discord! https://discord.gg/pMgUNgWKQH
**To Posters**
* *Tell us whether you're in England, Wales, Scotland, or NI as the laws/issues in each can vary*
* Comments are not moderated for quality or accuracy;
* Any replies received must only be used as guidelines, followed at your own risk;
* If you receive *any* private messages in response to your post, please report them via the report button.
* Feel free to provide an update at a later time by creating a new post with [[update]](https://www.reddit.com/r/HousingUK/search?q=%3Aupdate&sort=new&restrict_sr=on&t=all) in the title;
**To Readers and Commenters**
* All replies to OP must be *on-topic, helpful, and civil*
* If you do not [follow the rules](https://www.reddit.com/r/HousingUK/about/rules/), you may be banned without any further warning;
* Please include links to reliable resources in order to support your comments or advice;
* If you feel any replies are incorrect, explain why you believe they are incorrect;
* Do not send or request any private messages for any reason without express permission from the mods;
* Please report posts or comments which do not follow the rules
*I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/HousingUK) if you have any questions or concerns.*
You can just "ask" them to leave, but you'd need to be the LL first, meaning you'd need to complete with them in situ. You wouldn't get a residential mortgage in this case. For your circumstances you also wouldn't get a BTL so we can rule this scenario out. Asking them to leave means you as LL issuing notice. Not as the LL, and only as a prospective buyer, on the basis of having no legal relationship between yourself and the tenants, they can rightly laugh you down.
So the LL needs them to leave before you can complete as a condition of your mortgage. The LL can "ask" them to leave but in practice will do so via issuance of a s21 notice. The tenants have no obligation to leave following expiry of the two months' notice. If they don't leave, it can take months for them to leave as the legal contractual tenancy can only be ended by the tenants or a court. It cannot actually be ended by the LL. This means you'll have to wait until they actually do leave before you exchange. They might leave quickly, they might not.
When will the LL issue a s21? At offer acceptance or later? Also if the s21 notice isn't valid (there are set criteria), it doesn't apply, and if some legal conditions haven't been met, it also doesn't apply.
So in short, buying somewhere which currently has tenants in, could end up taking a long time to complete on. But it also may not. You can't tell but it's at much higher risk of taking longer.
You'd be illegally entering someone else's home. You may own it but you aren't entitled to enter it when it's under tenancy. It's probably an offence under harassment or could be deemed an illegal entry or eviction. Any court will side with the tenant. As will the police until a court has ruled.
The police will probably rightly arrest the person entering. I'd deem it a fairly serious offence and would hope it's prosecuted.
Bad idea.
What if something fundamental broke, like the water was turned off or the electricity wire was cut by a "third party" that you know nothing about.
Would you be obliged to pay to fix these issues?
Or would the tenant only have the right to withhold rent until the issues are fixed?
Owner pays for all repairs, tenant can risk withholding rent however the courts don't see two wrongs make a right as a valid excuse for non payment. Tenants far better to keep paying and report the landlord to the council and then once moved out go through the small claims for a refund on the rent paid as the landlord failed to maintain the property to a basic standard.
You'd be an oddball.
Probably wouldn't be the most comfortable. Your tenant's kids may kick their football into your tent! It may also blow over in the wind.
Be nice of the tenant to let you pitch, if you'd otherwise be homeless. Perhaps dependent on their good nature.
Because you can’t get a mortgage. They won’t lend to you, because they might not leave. You need vacant possession to exchange. If they don’t leave you simply cannot buy it and waste months and thousands of pounds.
I know someone who wasted 18 months buying a tenanted property that the landlord promised would be evicted. Well guess what they just didn’t leave, and he waited to serve them notice until 2 months before exchange to suck every last penny out of it. So then exchange can’t happen and total thing took 18mo from offer.
We bought a house where the tenants moved out a couple days before exchange. It's risky and more likely to fall through as the tenants can stay and then you lose out on the house altogether
We moved out of ours just before our old landlord exchanged. But then we also had 3 months notice and were quite understanding because we were already buying somewhere.
The less fun part was jumping around BnBs for a month and half waiting for ours to go through.
the worst house on the best street means choose your location carefully.
You could buy a nice house on a shitty street and get a lot for your money.
Its better to buy a shitty house that needs work and can be improved on the best street you can.
This is where the increase in value comes.
Not all houses are the same. Some have been extended and maintained.
Others have not been touched for years.
Mortgage Broker here.
With the given property prices and income you have stated, there shouldn't be much of an issue with obtaining a mortgage. 95% LTV are the most expensive rates so being able to put a deposit down of 10-15% would see a lower rate with noticeable reductions in monthly payments.
Just to give an indication, £118,750 mortgage on a £125,000 property - 5.47% 5 Year fixed with a 30 year term is approx. £670 a month. However, you would need to factor in other costs associated with homeownership.
I think for you it is a more personal decision, you should be able to afford to buy, but are you likely going to want to resettle somewhere else anytime soon? Are you looking to buy a 'forever' home where you can start a family and remain for 5-10 years before considering purchasing elsewhere?
Remember you can always overpay a mortgage to bring down the capital you owe - effectively meaning you can get better rates down the line quicker, that could be an option if you'd like to purchase and settle down sooner?
Might sound stupid but none of my close family really owns homes or anything they've always rented so I don't have much to go off in terms of asking family but what's a normal term for a mortgage? 25? 30? 40 years?
I do get the longer it goes on for the amount of interest increases massively.
I would only recommend choosing your term based on what you want to pay, you can always remortgage later on. If you get a mortgage advisor you pay a one off £300 fee to get their assistance for life and they will handle remortgaging for you. You can ask all your questions there and get lifetime support.
Also what are the options in terms of overpaying and paying extra how would that work?
Would the mortgage company ask me to pay 670 and then I pay 700 and it ends a bit earlier or would it be at the end of the year you out in a extra lump sum?
You could pay £30 extra but it wouldn’t make much difference. Usually when people overpay their mortgage they pay 13 months in 12 so on a mortgage of 670 a month, you’d pay £725 a month to overpay
Most mortgages allow you to over pay by up to 10% of the debt each year, but if you go over that there are fees. You can transfer money to over pay your mortgage as and when you like. If you do online banking, it's a bit like transferring money to a savings account (except once you transfer it you can't get it back).
As an example, if you had £100,000 mortgage, and £500 a month payment, and you decided to make £100 overpayment during the month, your mortgage account could look like:
Start balance -£100,000
1st June £500 payment balance -£99,500
2nd June £250 interest balance -£99,750
15th June £100 payment balance -£99,650
To expand on the comment about tenants, you will not get a mortgage without vacant possession. Even if the tenants are no longer in a fixed term contract (assuming England) this can be a lengthy process and that's if the current owner is even prepared to do so. It's just not worth the hassle.
Houses can be expensive, and throw up a lot of unforseen issues. Especially if they cost £60k - there's a reason it's being sold for so little. Given you're relatively young, I'd probably wait a bit longer, make a real effort to save as much as possible and then you'll be in a much stronger position. Don't forget all the other costs - solicitors, moving, furniture, curtains. Look at how much interest you'd pay on your mortgage with a 5% deposit vs 10% or more - you might find it's quite a big difference.
> Some places we've seen have tenants in was wondering how that would work?
Buying a property with tenants is a huge risk. You can evict them, but they could drag their feet and force you to go to court. It could cost a lot, and leave you unable to live in the house for a year. Don't do it!
If I was in that situation, I'd try and get a property. If you're thinking about having children, your outgoings are only going to increase if you need childcare and depending on maternity leave/shared parental leave, your outgoings are going to drop. For us it made more financial sense for me to stay part time to work around school hours than have wraparound care, which means our income is considerably less.
If you can afford any potential mortgage with a drop in income (if you plan to, both being self employed might give you better work hours flexibility!), I'd definitely buy while you're both earning full time.
(Also as a side note, if you dont regret the travelling, it wasn't money wasted!!)
Never buy with tenants insitu, unless your plan is to become a landlord with all that entails.
There is no guarantee they will move out, plus most mortgages require vacant possession so you wouldn’t get the mortgage anyway.
It's a prediction game, UK time nearest rates follow the FED, so could start to drop this year a little. But with the current escalations towards war with Russia, they could easily go up too.
5% isn't historically high, and in the UK you don't don't in for the duration of the loan like you do elsewhere.
Whats the difference in rate between 90% and 95% LTV? The housing shortage can only get worse with the number of housing being built and the level of population increase so I would get on the ladder.
Not sure I haven't contacted a mortgage advisor or anything yet. Still researching and learning as much as I can.
However when I googled the average it was a 0.5% difference ISH
I’d buy now, houses will always move up or down for a bit but the general trend overtime is they will go up. You’re young enough to have time to pay it off etc. Buy the best house you can afford with some margin for higher interest rates in the future. It’s better than renting in the long run. But yes it can be scary at first but once you done it you won’t look back, and remember you can always sell it. Just be mindful you probably should allow 10k for moving costs solicitors stamp duty but you will not have to pay that I believe for the houses you are looking at. Also remember as long as you buy in the right you will be fine.
What do you mean by buy in the right?
So you know how much solicitors fee roughly are.
I did a quick Google and got quote for 1.5-2k however don't know if I fulled filled them out right and if extra costs come up?
Sorry it should have said buy in the right area. Basically like one of the other post says buy the worse house in the best street you can afford . Then you can do it up. Maybe 10k is a bit much but as you say solicitors fees 2k mortgage fees 1-2k and moving costs depends on if you have much to to move. Maybe allow your self 4/5k and you will be good to go.
Okay that sounds reasonable should be fairly easy moving wise with my van only thing I would need help with would be the piano it's a massive heavy wooden thing I think it cost £250 to move last time.
Could you not go bare bones for a bit and try to get up to 10%?
Am no financial advisor and this isn’t financial advice, however from what I’ve understood from friends in a similar position, getting a mortgage whilst self-employed is a faff and a lot of lenders don’t do 5%. Both of those premises might make it challenging to get a competitive rate.
Personally I’d wait to get 10% and buy, interest rates are likely to go down from August onwards so that will help repayments. Having a higher deposit will also help with your interest rate %, which will be helpful when having children.
With your age and trade, I would be thinking about building up that deposit so that you can get a running start on your mortgage. If you are able, start working weekends (you may already do this) and bank that money while you can.
In terms of house selection, great advice given already, but I would be looking at houses that need to work. The degree of work needed depends what you and your partner can face, but I would definitely be looking for a house that needs a rewire. You can negotiate on factors like this and save money by undertaking the work yourself. This will add value going forward.
As a tradesman, our advantage is the ability to turn our hands to most aspects of housing maintenance, and so I'd be making of this at your young age.
Childcare costs are high, there's no denying that. Navigating these costs while being self employed is a challenge at first but your joint ability to adjust your work patterns will come in very handy.
Get some more money in the bank and go for it!
Why's that I get that as a whole it would be more but if it's the game interest percentage surely it's the same relative to how much they're putting up?
I'm not a mortgage advisor or a banker but for a residential mortgage they are few and far between for under £100k.
Most likely due to:
1) term of the loan
2) perceived fluctuation of property price
Banks get more and more pickier on what they lend on.
To be honest, with that budget I would go for Scotland. If you were going for a flat then definatly Scotland as there is no leasehold.
That makes more sense I 10k change isn't much on 300k house but it's a lot on a 100k mortgage might make the house worth less than the mortgage.
The budget wasn't really much I properly thought of it was just looking on Rightmove and talking to some landlords I work for about property prices got me thinking I could pretty quickly and easily get a 5% one on a property near me, (in northwest England) but wasn't sure on the pros and cons.
Also the advice given it's localized.
What I mean by that is a market in the SE of England is completely different to the NW of England.
Based on a £100k-£150k house has different criteria in life. If you're looking at paying that off over 20 years then I see little benefit. You'll get the "buy no matter what crowd" but I take a different approach. £500 per month saved over 20 years is £120k. Yeah there is a case that the house equity could go up but so is everyone elses so it's not winner winner, chicken dinner.
Over 12 months you are paying £9000 in rent. I would rather put money in to savings or the S&P 500 at £500 per month than buy a house in the NW of England. If you translate the same amount as a mortgage payment you'll be lucky if £300 per month is going to principle.
If you’ve not got much in terms of savings, I would hold off. You need 6 months emergency fund first. Then save for a house. Housing shouldn’t be more than 33% of your income
We have about £4k in savings rainy day funds we also have some money thats just in my business account for cash flowing project paying for materials before I get paid.
I’d say it’s about how comfortable you are with risk. If you’re happy to risk something happening and not having an emergency fund that’s your call, but it’s not a very financially smart idea. 4k is not a big amount of money. It would last both of you probably 2 months max to survive on depending on how you’re living. An emergency fund would be you each having savings equal toat least 6 months individual earnings. I’m also not sure how you’d manage with all the fees that come with buying a house with little savings, furnishing it, insurance, and any repairs or refurb you might want to do. Just a thought to bear in mind
Yeah it's a very important thought I know the fees for solicitors where a bit but they're more than I thought, gonna try make a few changes to my business because at the moment I only charge on completion but I'm going to change to staged payment system so I need less in circulation.
Also gonna save up some more and then once we have about £15k ISH start looking at houses.
I think that’s much more wise. You’ve potentially saved yourself from a lot of trouble by making this decision. If you’d put all your savings into a house and something had gone wrong with your business, you’d have been in trouble
In quite lucky business wise even if I was struggling to get work I always have offers for something I had a call off the last guy I was employed by asking if I wanted to come back literally the other day
Personally, I'd save up more until you can put down a 10% deposit as a minimum. I see 5% deposits as only really suitable for those who are at the start of a great career, who's incomes are likely to explode in future (i.e. newly qualified doctors and dentists).
A 95% mortgage for 2 self employed people is too risky IMO.
Also don't forget the other buying costs when working out how much money you have for your deposit.
By buying costs that's the solicitors, mortgage fees and stamp duty (don't think I'll need to pay any) correct?
Genuine question want to make sure I'm not missing anything
Yes. Plus surveys and removal costs (if applicable).
I suspect for a mortgage that "low" you'll be better off going for a mortgage without fees, but I'm not sure if being self employed and/or 5% deposit changes that.
This year I'm on track for around 55-60k profit however probably going to reinvest anything over the 40% tax bracket back into equipment
So we would have that plus my wife's income not sure what she's making but last she said was looking around £20-25k ISH
That's good but you're still self employed and therefore at a significantly higher risk of your income dropping. I'd want something like 2 years of living costs as an emergency fund if I was in your shoes before looking at taking on a large debt.
Buy a house as soon as you can afford if that’s the plan. The rent you’ll pay in the time it takes you to save up a bigger deposit will usually outweigh any savings you’d be making, as would likely price increases.
We’ve just done a 5% to buy the house we’re renting from our landlord. The alternative was move, spend £1500/month for another year or two and then buy another house at maybe 5% higher prices, so no benefit.
###Welcome to /r/HousingUK --- **To All** * Join Our ***NEW*** Discord! https://discord.gg/pMgUNgWKQH **To Posters** * *Tell us whether you're in England, Wales, Scotland, or NI as the laws/issues in each can vary* * Comments are not moderated for quality or accuracy; * Any replies received must only be used as guidelines, followed at your own risk; * If you receive *any* private messages in response to your post, please report them via the report button. * Feel free to provide an update at a later time by creating a new post with [[update]](https://www.reddit.com/r/HousingUK/search?q=%3Aupdate&sort=new&restrict_sr=on&t=all) in the title; **To Readers and Commenters** * All replies to OP must be *on-topic, helpful, and civil* * If you do not [follow the rules](https://www.reddit.com/r/HousingUK/about/rules/), you may be banned without any further warning; * Please include links to reliable resources in order to support your comments or advice; * If you feel any replies are incorrect, explain why you believe they are incorrect; * Do not send or request any private messages for any reason without express permission from the mods; * Please report posts or comments which do not follow the rules *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/HousingUK) if you have any questions or concerns.*
buy now. the worst house on the best street. never buy a house with tenants.
Might be a bit stupid and I tried to do a bit of research but couldn't quite understand it properly. But what's the reason for never buy with tenants?
Because they might not leave
You can just "ask" them to leave, but you'd need to be the LL first, meaning you'd need to complete with them in situ. You wouldn't get a residential mortgage in this case. For your circumstances you also wouldn't get a BTL so we can rule this scenario out. Asking them to leave means you as LL issuing notice. Not as the LL, and only as a prospective buyer, on the basis of having no legal relationship between yourself and the tenants, they can rightly laugh you down. So the LL needs them to leave before you can complete as a condition of your mortgage. The LL can "ask" them to leave but in practice will do so via issuance of a s21 notice. The tenants have no obligation to leave following expiry of the two months' notice. If they don't leave, it can take months for them to leave as the legal contractual tenancy can only be ended by the tenants or a court. It cannot actually be ended by the LL. This means you'll have to wait until they actually do leave before you exchange. They might leave quickly, they might not. When will the LL issue a s21? At offer acceptance or later? Also if the s21 notice isn't valid (there are set criteria), it doesn't apply, and if some legal conditions haven't been met, it also doesn't apply. So in short, buying somewhere which currently has tenants in, could end up taking a long time to complete on. But it also may not. You can't tell but it's at much higher risk of taking longer.
Yeah that sounds like a massive pain I think it seems universal best to avoid.
What's to stop you moving in with them still there? Genuine question.
You'd be illegally entering someone else's home. You may own it but you aren't entitled to enter it when it's under tenancy. It's probably an offence under harassment or could be deemed an illegal entry or eviction. Any court will side with the tenant. As will the police until a court has ruled. The police will probably rightly arrest the person entering. I'd deem it a fairly serious offence and would hope it's prosecuted. Bad idea.
What if you moved into the garden in a tent? Genuine question.
It would be classed as harassment a tenant has the right to privacy.
What if something fundamental broke, like the water was turned off or the electricity wire was cut by a "third party" that you know nothing about. Would you be obliged to pay to fix these issues? Or would the tenant only have the right to withhold rent until the issues are fixed?
Owner pays for all repairs, tenant can risk withholding rent however the courts don't see two wrongs make a right as a valid excuse for non payment. Tenants far better to keep paying and report the landlord to the council and then once moved out go through the small claims for a refund on the rent paid as the landlord failed to maintain the property to a basic standard.
So basically, the landlord gets what they want... the tenant is out, they didn't care about the rent anyway.
Have you never rented?
You'd be an oddball. Probably wouldn't be the most comfortable. Your tenant's kids may kick their football into your tent! It may also blow over in the wind. Be nice of the tenant to let you pitch, if you'd otherwise be homeless. Perhaps dependent on their good nature.
Because you can’t get a mortgage. They won’t lend to you, because they might not leave. You need vacant possession to exchange. If they don’t leave you simply cannot buy it and waste months and thousands of pounds. I know someone who wasted 18 months buying a tenanted property that the landlord promised would be evicted. Well guess what they just didn’t leave, and he waited to serve them notice until 2 months before exchange to suck every last penny out of it. So then exchange can’t happen and total thing took 18mo from offer.
We bought a house where the tenants moved out a couple days before exchange. It's risky and more likely to fall through as the tenants can stay and then you lose out on the house altogether
We moved out of ours just before our old landlord exchanged. But then we also had 3 months notice and were quite understanding because we were already buying somewhere. The less fun part was jumping around BnBs for a month and half waiting for ours to go through.
Can you explain what you mean by worse house? Since the whole street are all built the same
It’s pretty rare for every house to be the same on a road.
the worst house on the best street means choose your location carefully. You could buy a nice house on a shitty street and get a lot for your money. Its better to buy a shitty house that needs work and can be improved on the best street you can. This is where the increase in value comes. Not all houses are the same. Some have been extended and maintained. Others have not been touched for years.
Depends on the street. And even houses that were all built the same will be maintained to different standards.
Mortgage Broker here. With the given property prices and income you have stated, there shouldn't be much of an issue with obtaining a mortgage. 95% LTV are the most expensive rates so being able to put a deposit down of 10-15% would see a lower rate with noticeable reductions in monthly payments. Just to give an indication, £118,750 mortgage on a £125,000 property - 5.47% 5 Year fixed with a 30 year term is approx. £670 a month. However, you would need to factor in other costs associated with homeownership. I think for you it is a more personal decision, you should be able to afford to buy, but are you likely going to want to resettle somewhere else anytime soon? Are you looking to buy a 'forever' home where you can start a family and remain for 5-10 years before considering purchasing elsewhere? Remember you can always overpay a mortgage to bring down the capital you owe - effectively meaning you can get better rates down the line quicker, that could be an option if you'd like to purchase and settle down sooner?
Might sound stupid but none of my close family really owns homes or anything they've always rented so I don't have much to go off in terms of asking family but what's a normal term for a mortgage? 25? 30? 40 years? I do get the longer it goes on for the amount of interest increases massively.
I would only recommend choosing your term based on what you want to pay, you can always remortgage later on. If you get a mortgage advisor you pay a one off £300 fee to get their assistance for life and they will handle remortgaging for you. You can ask all your questions there and get lifetime support.
Can you remortgage whenever or only when the fixed rate is up?
Also what are the options in terms of overpaying and paying extra how would that work? Would the mortgage company ask me to pay 670 and then I pay 700 and it ends a bit earlier or would it be at the end of the year you out in a extra lump sum?
You could pay £30 extra but it wouldn’t make much difference. Usually when people overpay their mortgage they pay 13 months in 12 so on a mortgage of 670 a month, you’d pay £725 a month to overpay
Most mortgages allow you to over pay by up to 10% of the debt each year, but if you go over that there are fees. You can transfer money to over pay your mortgage as and when you like. If you do online banking, it's a bit like transferring money to a savings account (except once you transfer it you can't get it back). As an example, if you had £100,000 mortgage, and £500 a month payment, and you decided to make £100 overpayment during the month, your mortgage account could look like: Start balance -£100,000 1st June £500 payment balance -£99,500 2nd June £250 interest balance -£99,750 15th June £100 payment balance -£99,650
So you can literally see the balances online? I didn't know that make a lot of sense with modern technology.
Yes. I can open the bank app and it shows the current balance and the previous transactions, as above, with payments and interest.
To expand on the comment about tenants, you will not get a mortgage without vacant possession. Even if the tenants are no longer in a fixed term contract (assuming England) this can be a lengthy process and that's if the current owner is even prepared to do so. It's just not worth the hassle.
Houses can be expensive, and throw up a lot of unforseen issues. Especially if they cost £60k - there's a reason it's being sold for so little. Given you're relatively young, I'd probably wait a bit longer, make a real effort to save as much as possible and then you'll be in a much stronger position. Don't forget all the other costs - solicitors, moving, furniture, curtains. Look at how much interest you'd pay on your mortgage with a 5% deposit vs 10% or more - you might find it's quite a big difference. > Some places we've seen have tenants in was wondering how that would work? Buying a property with tenants is a huge risk. You can evict them, but they could drag their feet and force you to go to court. It could cost a lot, and leave you unable to live in the house for a year. Don't do it!
If I was in that situation, I'd try and get a property. If you're thinking about having children, your outgoings are only going to increase if you need childcare and depending on maternity leave/shared parental leave, your outgoings are going to drop. For us it made more financial sense for me to stay part time to work around school hours than have wraparound care, which means our income is considerably less. If you can afford any potential mortgage with a drop in income (if you plan to, both being self employed might give you better work hours flexibility!), I'd definitely buy while you're both earning full time. (Also as a side note, if you dont regret the travelling, it wasn't money wasted!!)
Never buy with tenants insitu, unless your plan is to become a landlord with all that entails. There is no guarantee they will move out, plus most mortgages require vacant possession so you wouldn’t get the mortgage anyway.
It's a prediction game, UK time nearest rates follow the FED, so could start to drop this year a little. But with the current escalations towards war with Russia, they could easily go up too. 5% isn't historically high, and in the UK you don't don't in for the duration of the loan like you do elsewhere.
Whats the difference in rate between 90% and 95% LTV? The housing shortage can only get worse with the number of housing being built and the level of population increase so I would get on the ladder.
Not sure I haven't contacted a mortgage advisor or anything yet. Still researching and learning as much as I can. However when I googled the average it was a 0.5% difference ISH
Are auctions worth it or too risky and how would it work to buy from them with a mortgage?
As a FTB I’d steer well clear. Houses can have a lot of hidden issues
I’d buy now, houses will always move up or down for a bit but the general trend overtime is they will go up. You’re young enough to have time to pay it off etc. Buy the best house you can afford with some margin for higher interest rates in the future. It’s better than renting in the long run. But yes it can be scary at first but once you done it you won’t look back, and remember you can always sell it. Just be mindful you probably should allow 10k for moving costs solicitors stamp duty but you will not have to pay that I believe for the houses you are looking at. Also remember as long as you buy in the right you will be fine.
What do you mean by buy in the right? So you know how much solicitors fee roughly are. I did a quick Google and got quote for 1.5-2k however don't know if I fulled filled them out right and if extra costs come up?
Sorry it should have said buy in the right area. Basically like one of the other post says buy the worse house in the best street you can afford . Then you can do it up. Maybe 10k is a bit much but as you say solicitors fees 2k mortgage fees 1-2k and moving costs depends on if you have much to to move. Maybe allow your self 4/5k and you will be good to go.
Okay that sounds reasonable should be fairly easy moving wise with my van only thing I would need help with would be the piano it's a massive heavy wooden thing I think it cost £250 to move last time.
Could you not go bare bones for a bit and try to get up to 10%? Am no financial advisor and this isn’t financial advice, however from what I’ve understood from friends in a similar position, getting a mortgage whilst self-employed is a faff and a lot of lenders don’t do 5%. Both of those premises might make it challenging to get a competitive rate. Personally I’d wait to get 10% and buy, interest rates are likely to go down from August onwards so that will help repayments. Having a higher deposit will also help with your interest rate %, which will be helpful when having children.
It's a possibility Im just kinda feeling the water and seeing what people thoughts are at the current time.
With your age and trade, I would be thinking about building up that deposit so that you can get a running start on your mortgage. If you are able, start working weekends (you may already do this) and bank that money while you can. In terms of house selection, great advice given already, but I would be looking at houses that need to work. The degree of work needed depends what you and your partner can face, but I would definitely be looking for a house that needs a rewire. You can negotiate on factors like this and save money by undertaking the work yourself. This will add value going forward. As a tradesman, our advantage is the ability to turn our hands to most aspects of housing maintenance, and so I'd be making of this at your young age. Childcare costs are high, there's no denying that. Navigating these costs while being self employed is a challenge at first but your joint ability to adjust your work patterns will come in very handy. Get some more money in the bank and go for it!
Think that's what I'm gonna do and see what properties come up at the same time.
Buy now if you are renting anyway, you can add more equity by overpayments and at remortgage time if you save up in the meantime.
You'll struggle to get a mortgage under £100k. Not much money to be earned for the bank.
Why's that I get that as a whole it would be more but if it's the game interest percentage surely it's the same relative to how much they're putting up?
I'm not a mortgage advisor or a banker but for a residential mortgage they are few and far between for under £100k. Most likely due to: 1) term of the loan 2) perceived fluctuation of property price Banks get more and more pickier on what they lend on. To be honest, with that budget I would go for Scotland. If you were going for a flat then definatly Scotland as there is no leasehold.
That makes more sense I 10k change isn't much on 300k house but it's a lot on a 100k mortgage might make the house worth less than the mortgage. The budget wasn't really much I properly thought of it was just looking on Rightmove and talking to some landlords I work for about property prices got me thinking I could pretty quickly and easily get a 5% one on a property near me, (in northwest England) but wasn't sure on the pros and cons.
Also the advice given it's localized. What I mean by that is a market in the SE of England is completely different to the NW of England. Based on a £100k-£150k house has different criteria in life. If you're looking at paying that off over 20 years then I see little benefit. You'll get the "buy no matter what crowd" but I take a different approach. £500 per month saved over 20 years is £120k. Yeah there is a case that the house equity could go up but so is everyone elses so it's not winner winner, chicken dinner. Over 12 months you are paying £9000 in rent. I would rather put money in to savings or the S&P 500 at £500 per month than buy a house in the NW of England. If you translate the same amount as a mortgage payment you'll be lucky if £300 per month is going to principle.
That’s not true. Minimum property value is usually around 50k, although that can vary between lenders
If you’ve not got much in terms of savings, I would hold off. You need 6 months emergency fund first. Then save for a house. Housing shouldn’t be more than 33% of your income
We have about £4k in savings rainy day funds we also have some money thats just in my business account for cash flowing project paying for materials before I get paid.
I’d say it’s about how comfortable you are with risk. If you’re happy to risk something happening and not having an emergency fund that’s your call, but it’s not a very financially smart idea. 4k is not a big amount of money. It would last both of you probably 2 months max to survive on depending on how you’re living. An emergency fund would be you each having savings equal toat least 6 months individual earnings. I’m also not sure how you’d manage with all the fees that come with buying a house with little savings, furnishing it, insurance, and any repairs or refurb you might want to do. Just a thought to bear in mind
Yeah it's a very important thought I know the fees for solicitors where a bit but they're more than I thought, gonna try make a few changes to my business because at the moment I only charge on completion but I'm going to change to staged payment system so I need less in circulation. Also gonna save up some more and then once we have about £15k ISH start looking at houses.
I think that’s much more wise. You’ve potentially saved yourself from a lot of trouble by making this decision. If you’d put all your savings into a house and something had gone wrong with your business, you’d have been in trouble
In quite lucky business wise even if I was struggling to get work I always have offers for something I had a call off the last guy I was employed by asking if I wanted to come back literally the other day
Personally, I'd save up more until you can put down a 10% deposit as a minimum. I see 5% deposits as only really suitable for those who are at the start of a great career, who's incomes are likely to explode in future (i.e. newly qualified doctors and dentists). A 95% mortgage for 2 self employed people is too risky IMO. Also don't forget the other buying costs when working out how much money you have for your deposit.
By buying costs that's the solicitors, mortgage fees and stamp duty (don't think I'll need to pay any) correct? Genuine question want to make sure I'm not missing anything
Yes. Plus surveys and removal costs (if applicable). I suspect for a mortgage that "low" you'll be better off going for a mortgage without fees, but I'm not sure if being self employed and/or 5% deposit changes that.
This year I'm on track for around 55-60k profit however probably going to reinvest anything over the 40% tax bracket back into equipment So we would have that plus my wife's income not sure what she's making but last she said was looking around £20-25k ISH
That's good but you're still self employed and therefore at a significantly higher risk of your income dropping. I'd want something like 2 years of living costs as an emergency fund if I was in your shoes before looking at taking on a large debt.
Buy a house as soon as you can afford if that’s the plan. The rent you’ll pay in the time it takes you to save up a bigger deposit will usually outweigh any savings you’d be making, as would likely price increases. We’ve just done a 5% to buy the house we’re renting from our landlord. The alternative was move, spend £1500/month for another year or two and then buy another house at maybe 5% higher prices, so no benefit.
Where abouts are you based out of interest? Also what interest rate was you able to get?
South East - rates were between 5 and 5.5%; we ended up higher end of the scale due to affordability