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We're thinking of buying our first house and have some questions that you lot probably have opinions on.
We've been to an estate agent and chatted to a mortgage broker. Would anyone get a mortgage this way? We weren't sure about the £400 fee, but feel like it may make life a lot easier to do it this way rather than try to deal directly with a bank.
As for mortgages, would we regret a 30 year mortgage? We thought it might be a good idea to take out a 30 year and have lower repayments initially (We've just had a baby and have unknown outgoings approaching - childcare etc), then we can overpay when we've got a bit more money in a couple of years time.
We've looked at houses (We ain't rich so Reddish area in Manchester, aspiring to hit the leafy heights of somewhere nicer in five-ten years or so.) But they're still a bit over budget. How cheeky can you be with your offer? We've looked at some which are ~£160k ish which frankly we can't afford. Is offering £140k going to cause trouble? We've looked at other houses in the area and it seems the absolute max you can hope to achieve is around £160k anyway so are these sellers just trying their luck?
The house we're interested in is on at £160k, in need of quite a lot of TLC - decorating, new kitchen etc and even if we got it for £140k then by the time we've done work on the house we're not sure whether we might lose money on it when we come to sell. (We appreciate that there is a chance of this happening anyway given the market can do what it wants - see the other housing thread).
It's all a bit daunting - any advice appreciated. And I know Reddish isn't all that but we can't find anywhere more suitable for our budget.
It depends on what the same house in perfect condition would sell for - do some research on house prices on the street (Rightmove have a 'sold prices' section) and start to get the bigger picture.
For example, if the identical house next door (in perfect condition) sold for £150k last month then you would be bonkers to offer much more than £135k. If it sold for £200k then it would suggest that you could buy the house you have seen for £160k, spend £20k on it and still sell it and make some money.
Rightmove have a 'sold prices' section
Hadn't seen that - thanks a lot!
We've been to an estate agent and chatted to a mortgage broker. Would anyone get a mortgage this way?
We did and can't say it was any easier or more difficult than dealing with a bank. However, if you don't use the broker in that estate agents, you may find yourself down the list if the agent elects to only show houses/give preferential treatment to buyers who also use their broker. It shouldn't happen, but I bet it does.
re: mortgage broker, go and see one, it's worth having a chat, but what they do isn't rocket science - there's plenty of comparison websites you can look at to find the best deal for the right kind of mortgage for you. You'll quite quickly find a few providers who are doing the kind of mortgage you want - they all have points in the market they're competitive in, and others where they're less competitive.
Get an approval in principle from one of them, that might help negotiations. Keep an eye on those few lenders for their best deal.
Keep in contact with the broker, and when you're offering on a house, ask them if they have access to anything better than the best one you've found. If they can, and the difference is worth the fee, great. If not, why would you want to pay a fee to get locked into a more expensive mortgage? they can hardly be upset with you if you stick with what you've got.
Re mortgage: don't go to one you pay up front.
First call is the internet and your own bank. Do a quick search (google mortgages, money supermarket etc etc) and then go to your own bank and see what they can do armed with the rates and set up fees you got from your searching. You have history with your bank so are in a strong position to borrow from them (provided it's a good history).
Failing that use an independent mortgage advisor. Go on recommendation if possible, no up front fee and check what they come up with you own results. In difficult situations a good mortgage advisor is worth it as they can sort stuff out.
Don't worry about the 30 year term, I doubt this will be your only mortgage or house in the next 30 years.
House - if it doesnt seem to make sense then walk away. When I was buying my first place as a student I nearly went for a modern flat just outside of town but had a feeling it would be a bad decision long term. 10 years on the flat I nearly bought had gone up £10k. The flat i did end up buying in a much better location went up over £100k.
Check how the market is moving using all the online tools available. Be realistic with costs of works and then add a contingency. Remember a house is a home at the end of the day so being happy there and it being suitable for commute, family support etc is the most important. But that said you don't want to end up trapped somewhere as it's been a bad choice of location and in the future you left seriously lagging the rest of the market. Choose a smaller property in a decent area if you have to. You can always get clever with space and it could be less upkeep (like for like). ie play it safe until you are more savvy with property which will come but first you need to take the plunge and learn.
A few things I learned:
- Offer what you think its worth/you can afford and be honest and polite about it. The worst they can do is say no.
- Buy somewhere you can see yourself living in long term and you won't regret it.
- Don't fall "in love" with a house. It's just a house. It's the people you share it with and the life you build in it that makes it a home.
Good luck!
Mortgage brokers can certainly make the process easier - they sometimes have deals that aren't publicly available but, much more importantly, they want an easy life so they have good information on which lenders are processing quickly and which are most likely to lend you someone in your individual financial situation.
The other side of this is that there are deals that are only direct. If you've a large deposit/low loan to value, aren't trying to borrow as much as you possibly can you'll likely save money going direct. As a first time buyer a broker can be useful. They always used to take their fee from the mortgage company - do they charge the borrower now?
Btw, check how they'll calculate your wife's pay if she's on maternity leave. Some lenders are better than others for this.
I tried a broker, but it turned out to be a waste of time. I'm sure there are good ones out there, but I've not dealt with any yet.
All the advice I can give you is "good luck"!
We've put an offer in on a house which closes in 34min (Scotland). It's an exciting process and getting to nosey around peoples houses is good fun.
Be mindful of this one though
It's very difficult, I've been trying to convince myself we're not going to get this one to ease the heartache.Don't fall "in love" with a house.
Don't assume your income's going to rise over time and don't buy somewhere with the idea of 'climbing up the ladder' in 5-10 years time... there's no guarantee either will happen.
Buy somewhere you'd be happy to be in for the rest of your life - and you'd be happy for your kids to grow up in... and whatever you do, remember that interest rates are at emergency levels, put there to stop a total collapse in 2008 - ask yourself if the outlook is so good, why we're still at those levels... and that interest rates WILL go up during the term of your mortgage, and therefore so will your repayments
[url= http://www.ft.com/cms/s/0/23c718b2-d3e9-11e5-829b-8564e7528e54.html#axzz40KDqOYzH ]Living standards going nowhere fast...[/url]
I don't mean to put you off but if you look at the underlying 'strength' of the UK economy and the absence of any real drivers of growth, you'll see tha the current idea that house prices, wages and living standards will repeat what they've done over the last 20+ years is more akin to a religious belief than fact-based analysis...
hey always used to take their fee from the mortgage company - do they charge the borrower now?
They'll get a kickback from the mortgage co and the fee as well.
We've been to an estate agent and chatted to a mortgage broker. Would anyone get a mortgage this way? We weren't sure about the £400 fee, but feel like it may make life a lot easier to do it this way rather than try to deal directly with a bank.
Firstly find the best deal you can which fits your requirements on a comparison site. Then speak to the broker and see if they can do any better. If they can't, save the £400.
You will be filling in exactly the same forms whether you go direct or use the broker. the same people will make the decision.
I have used one previously, and to be honest it's mainly money for old rope.
I don't mean to put you off but if you look at the underlying 'strength' of the UK economy and the absence of any real drivers of growth, you'll see tha the current idea that house prices, wages and living standards will repeat what they've done over the last 20+ years is more akin to a religious belief than fact-based analysis...
On the other hand:
Your career hopefully wont stagnate, and inflation is a fair constant over the medium to long term. So even if the average 25yr old is no better off in 10 years time than a 25year old is now, the former will be 35, might have taken a few steps up the career ladder and inflation will have upped his wages some 28% (assuming 2.5% a year), meanwhile their mortgage is still the same*. Don't forget that those who suffered through the bad old days of the miners strikes and the early 80's etc, are now the "baby boomers", things might still be crap for 20somethings, but things move on.
We went through a broker, and got a broker only deal, and all the paperwork was straighforward. But OTOH HSBC don't offer mortgages through brokers, and would have given us the same rate anyway and we bank with them so the paperwork would have been just as straight forward.
*Ok rates will go up, it's inevitable, but if they hit 15% again then frankly the country's so farked you'd be so far from being the only one bankrupt that defaulting on the mortgage would be a minor worry. And with that apocalyptic vision in mind I can't see any government not opting to inflate it's way out of the problem.
looking back i would use a broker.....made life much easier for my mates that did after my mortgage chaos.... which was a straightforward application TBH ....
More so , ask you self this - where do you see rents at in 5 years time ?
from the minute i signed up on my mortgage it was less per month than rent on a similar property locally .... as i pay off prinicipal the cost per month has come down to more than half the current rent on a similar property.
Now the kicker for me .... i have 1 maybe 2 months protection on being asked to move on from the rental.
House is a home not an investment.
Rentals are an important part of society allowing social mobility - i would never have bought up here to move here the first time.... and i dont think its ever a good idea to move to an area without living there first....it may look nice but below the surface there can be hidden dangers... i remember my first rental which during the day was nice but at night was like beruit.
inflation is a fair constant over the medium to long term. So even if the average 25yr old is no better off in 10 years time than a 25year old is now, the former will be 35, might have taken a few steps up the career ladder and inflation will have upped his wages some 28% (assuming 2.5% a year), meanwhile their mortgage is still the same
Inflation just means that the things you buy get more expensive. Assuming there will be inflation (fair enough, despite the recent blip) is very different from assuming you'll get a pay rise every year. Both may be true, but they're not one and the same.
We bought a house in the summer. It's lot like renting, except we have to fix stuff ourselves now.
We bought it thinking we didn't need to do much, and have just spent the best part of a grand having the bedroom completely replastered because we took the wallpaper off and realised that it was holding the plaster up! Knock on the walls looking for hollow spots (doesn't work with newer stud/boarded walls). Replastering is messy and expensive, if you know it needs doing then fine, but it's an unpleasant surprise.
And now there's a leak in the kitchen roof, so that needs sorting. And some corners have obviously been cut in the bathroom. And I need to run electrics out to the garage. And the front door is sticking. And, and, and....
But at least now we're paying our own mortgage off rather than someone else's. The mortgage on the house is less than the rent on the flat too.
dufresneorama - Member
All the advice I can give you is "good luck"!We've put an offer in on a house which closes in 34min (Scotland). It's an exciting process and getting to nosey around peoples houses is good fun.
Be mindful of this one though
Don't fall "in love" with a house.
It's very difficult, I've been trying to convince myself we're not going to get this one to ease the heartache.
How'd you get on?
Also, I wouldn't be shy to offer less. In Scotland houses are always listed as 'offers over'. I ignore this though, and we're thinking of offering around 7-8% less on a house we're keen on just now. Especially as it's been for sale for a year! Our offer will be around 80k lower than the home report value.
offering around 7-8% less on a house we're keen on just now. Especially as it's been for sale for a year! Our offer will be around 80k lower than the home report value.
Am I misunderstanding that or is this a casual "we're buying a £million+ house" post.
No, the home report has it valued high, it's listed at a lower price, and we're offering 7-8% less than the listed price. Say the home report said 10 units, they're asking 8 units, we're offering about 7.5 units. So if 10-7.5 = 80k, the house would be ballpark 320k, for example.
Call [url= https://www.landc.co.uk/ ]London and Country[/url] ... free advice and no hidden fees even if you go all the way.
Brilliant for my last mortgage plus everyone I've recommended them too has said the same. No need to go with their inhouse solicitors etc - go word of mouth for that (or I can recommend mine).
If your first offer doesn't make you cringe, it's not low enough.
Independent broker, shouldn't cost you anything, or look yourself online and contact the lenders direct. Brokers do manage the process, though and ensure all paperwork is correct.
Make cheeky offers..why not! As has been said, the worst they can say is NO. As a first time buyer with a mortgage approved you're essentially a cash buyer and that may make any offer you make more attractive. I offered 20k under asking price on my first house, and when they said no I walked away, 3 weeks later they phoned me and asked if I was still interested at my offer price, I was and I bought it. You just don't know peoples circumstances and how keen they are to sell.
Don't worry about mortgage term, you will move, you will have other houses and mortgages, just get on the ladder, you can worry about mortgage terms later.
In Scotland houses are always listed as 'offers over'.
Were, until about 10 ? years ago. Then a lot more Fixed Price, Offers In Region Of, and straight offer what you like and see what happens...
Still sitting by the phone....waiting....not so patiently...
Most of what we've seen has been advertised as Offers Over, wouldn't stop me offering under that though.
Only went and bought a house!
hah scary! What area?
Outskirts of Dundee....it's alright, we're moving further away from rather than closer too Dundee!!!
Always a good thing!
I'm going potty trying to find a perfect house in a good location. Refreshing rightmove every 20 mins in hope. Got a perfect house in a less than perfect location that'll add some commuting time each day, but I'm leaning towards saying it'll be worth it. It's beyond an obsession now.
I know how you feel! [i]F5[/i] has worn away to a stump!
Best of luck! It can be ruthless! Where abouts you looking?
We actually had to go above the OO price as there were so much interest and so may offers for this house, but it's got potential and will be our home for many many years hopefully.
Extra commute is no bad thing, this move might actually encourage me to get back on my bike!!! Will only be a 30min cycle for me, and I used to work nearby so was used to doing the commute the other way round. Should mean the wind at my back....not a chance!
another vote for London and Country brokers, no fee and simple to deal with.
I'm dying to stay in Torrance, but also looking at Bridge of Weir, bishopbriggs, Strathblane, Cumbernauld etc. This great house is in Slamannan so a wee bit further out