buying first home?

[dunning]

hi everyone,
been thinking about this the last few days.
i'm 21, currently work full time 45-50hrs a week.
i currently live with my parents but i'm looking at buying a house/flat

i'd basically like to know how it all works
i earn 18k per year and only have around 250 a month to pay out.

how do they work out what sort of mortgage i can have?
and what's the first step to take?

is there such a thing as a good mortgage? or do they all have plus and minus points?
also what sort of price would i pay each month on say a 130k home?

thanks for any info

[Brite spark]

dunning said:

hi everyone,
been thinking about this the last few days.
i'm 21, currently work full time 45-50hrs a week.
i currently live with my parents but i'm looking at buying a house/flat

i'd basically like to know how it all works
i earn 18k per year and only have around 250 a month to pay out.

how do they work out what sort of mortgage i can have?
and what's the first step to take?

is there such a thing as a good mortgage? or do they all have plus and minus points?
also what sort of price would i pay each month on say a 130k home?

thanks for any info

18k pay gross or net, how much deposit have you got saved?
130k home- or you mean 130k mortgage (unlikely if so- read impossible)
250 a month to pay out, you mean debts/ repayments or just going out on the beer?
(got a feeling you will be forgetting this idea pretty quickly imho)

you'll choose the type of mortgage that you want, it's wether the banks will lend to you- a good mortgage depends upon your definition of good, they obviously all have pro's and cons

scotal is the person to speak to regarding mortgages.

Edited by Brite spark on Saturday 18th July 19:29

[Merlot]

Brite spark said:

dunning said:

hi everyone,
been thinking about this the last few days.
i'm 21, currently work full time 45-50hrs a week.
i currently live with my parents but i'm looking at buying a house/flat

i'd basically like to know how it all works
i earn 18k per year and only have around 250 a month to pay out.

how do they work out what sort of mortgage i can have?
and what's the first step to take?

is there such a thing as a good mortgage? or do they all have plus and minus points?
also what sort of price would i pay each month on say a 130k home?

thanks for any info

130k mortgage will be ~£800pcm over 25 years, depending on the interest rate and other terms.

You will also need a deposit of about 10-15% of the value of the house.



18k pay gross or net, how much deposit have you got saved

(got a feeling you will be forgetting this idea pretty quickly imho)

[theaxe]

I guess you may get a loan for about 3x your salary before tax and they may lend you up to 90% of the value of the property (although the rate won't be very good).

So assuming that your 18k is before tax you can borrow up to about £54k which means you can buy a £60k house assuming that you have a £6k deposit and cash for a survey and fees.

If I was you I'd concentrate on building a career while you enjoy your twenties. Rent a house with some mates and try to save for a deposit.

Edited by theaxe on Saturday 18th July 19:32

[Brite spark]

Merlot said:

dunning said:

hi everyone,
been thinking about this the last few days.
i'm 21, currently work full time 45-50hrs a week.
i currently live with my parents but i'm looking at buying a house/flat

i'd basically like to know how it all works
i earn 18k per year and only have around 250 a month to pay out.

how do they work out what sort of mortgage i can have?
and what's the first step to take?

is there such a thing as a good mortgage? or do they all have plus and minus points?
also what sort of price would i pay each month on say a 130k home?

thanks for any info

130k mortgage will be ~£800pcm over 25 years, depending on the interest rate and other terms.

You will also need a deposit of about 10-15% of the value of the house.

edited for merlot- mixed quotes

Edited by Brite spark on Saturday 18th July 19:37

[plumAJP]

if you have a mrs, you can go joint on the mortgage application so lenders will consider your joint income and lend you more.

bear in mind, if it goes tits up with your mrs then half of the house etc is hers and there will be early repayament fees etc if you need to move out and sell up.

try and get at least a 10% deposit of the value of property your looking at otherwise i doubt you would get a mortagage

[dunning]

i've got about 15k in savings,
looks like i'll be having another think about this then. or save up a hell of a lot more lol, cheers anyway, thanks for clearing things up

[russ_a]

you could always try a site like moneysupermarket.com

[Simpo Two]

You earn £18K and live with your parents but only have £250pcm to spend on a mortgage? What does the other £1,000pcm go on?

[dunning]

no, i only pay out #250 a month, the other 1000ish goes to savings and daft things i may need, i can see where your coming from though, i didn't word it very well, sorry about that

Edited by dunning on Sunday 19th July 11:31

[Mx_Stu]

I was in a similar position to you when I was 21, although my situation was slightly different in that my parents were moving away and I had to either rent or buy.

The thought of renting never appealed to me so started to ask between my mates if any of them would be up for buying a house with me. This was mostly to get the multiplier on the mortgage and also mean we'd have a bigger deposit to put down.

I found a good mate who wanted to do the same. Between us we had £15k deposit and had a combined salary that mean't we could get a mortgage of £120k. We found a 3 bed house for £126k (so within our means) and all went through. We both knew from the outset that it wouldn't be forever and it lasted for 4 years when I bought him out a year ago.

We also had the added benefit of always renting the 3rd room out in the house which mean't that the mortgage payments were always £250 odd a month cheaper.

[b2dan]

I've just been approved a mortgage of up to £110,000 (with a £20,000 deposit so that's £130,000 total). Rate of 6.8% fixed for 2 years. I'm 22 on £25773 a year and it's a single application (the missus is going to uni).

Just viewed a house today, as soon as I walked through the door thought WOW! Going for a second viewing tomorrow. Seriously considering putting in an offer.

A word of advice, if you get overtime/commision, base your mortgage application/rates etc. on a flat month. One or two people where I were are starting to think "oh crap!"

And don't forget the solicitors fees, mortgage fees etc.

b2