# Is buying your 1st home always a compromise



## wish wash

Just spent the last few hours looking on right move and I feel wounded. How us young folk are supposed to get on the ladder I don't know.

I'm a country bumpkin and have no desire to move towards town but house prices seem cheaper in certain less desirable places. Anything where I've grown up is £150k plus for poky terrace houses. I know you have to work your way up the ladder, but everything that has potential for making money either sells straight away to developers or it's too expensive for me to start with. 

Maybe I'll just have to live at home forever


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## PugIain

I don't think you have to compromise, just don't be an idiot and saddle yourself with a load of debt just to look clever to others.

We could have afforded a more expensive, fancier house but that would have meant using more savings and using up more of our monthly income paying for it.
Meaning no holidays, no new cars, no takeaways and pub meals when we fancy.
And no wheel refurb s and sporty exhausts on old Peugeots.
Sod that.


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## wish wash

PugIain said:


> I don't think you have to compromise, just don't be an idiot and saddle yourself with a load of debt just to look clever to others.
> 
> We could have afforded a more expensive, fancier house but that would have meant using more savings and using up more of our monthly income paying for it.
> Meaning no holidays, no new cars, no takeaways and pub meals when we fancy.
> And no wheel refurb s and sporty exhausts on old Peugeots.
> Sod that
> 
> That's exactly what I don't want to do. Life's for living and I'd be miserable if I had no money left at the end of the month to do things. I think it's harder as I'll be buying by myself so can't split the mortgage 50/50


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## PugIain

Yes I can see the issue with buying on your own. I paid the 20k deposit and pay the mortgage on ours, but my partner pays water, electric and council tax.
She doesn't drive and I need a car so I 100% pay for that.

We've done a lot of stuff ourselves and with help from family to keep costs down too. Plus it keeps dads and step dads out of mischief 
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## wayne451

I don't get people's complaints?

You want a house or you don't? I hate to hit you with reality but that's life. You CANNOT have it all. So choose what's important to you? That's life. You have to sacrifice what you'd like for what you truly want.

It's happened to every generation.


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## Blackroc

wayne451 said:


> I don't get people's complaints?
> 
> You want a house or you don't? I hate to hit you with reality but that's life. You CANNOT have it all. So choose what's important to you? That's life. You have to sacrifice what you'd like for what you truly want.
> 
> It's happened to every generation.


There is indeed a large ammount of this (unless you have a large salary or lottery win!) but todays First Time Buyers 100% have it way harder than when I was a FTB in the 90's no doubt. Who can save £30k at the age of 20 and buy a house??

I'd also add though that house hunting (especially when you have other dependants in your life) does not get any easier either! The more people you have to think about living in the house, the more compromises have to be considered and life choices made IMO


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## wish wash

Blackroc said:


> There is indeed a large ammount of this (unless you have a large salary or lottery win!) but todays First Time Buyers 100% have it way harder than when I was a FTB in the 90's no doubt. Who can save £30k at the age of 20 and buy a house??
> 
> I'd also add though that house hunting (especially when you have other dependants in your life) does not get any easier either! The more people you have to think about living in the house, the more compromises have to be considered and life choices made IMO


Your right it is hard, I've sacrificed a lot growing up but I'm in a better position with a £40k deposit. Blood sweat and a lot of hard graft


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## wanner69

Blackroc said:


> There is indeed a large ammount of this (unless you have a large salary or lottery win!) but todays First Time Buyers 100% have it way harder than when I was a FTB in the 90's no doubt. Who can save £30k at the age of 20 and buy a house??
> 
> I'd also add though that house hunting (especially when you have other dependants in your life) does not get any easier either! The more people you have to think about living in the house, the more compromises have to be considered and life choices made IMO


Way harder? When we had a mortgage starting in the 1980s our interest rates were upto 18% and not like the 0.5% etc they've been for years.


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## PugIain

wish wash said:


> Your right it is hard, I've sacrificed a lot growing up but I'm in a better position with a £40k deposit. Blood sweat and a lot of hard graft


A big deposit puts you in a good position.
The people we bought off accepted my lower offer because we had everything in place and they had another house bought so wanted things moving.

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## Blackroc

wanner69 said:


> Way harder? When we had a mortgage starting in the 1980s our interest rates were upto 18% and not like the 0.5% etc they've been for years.


True - but these days things like 'Interest Only Mortgages' or £2k deposits (both done for first time buyers at the time) for a mortgage will never exist again either - so its swings and roundabouts


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## Kerr

Blackroc said:


> There is indeed a large ammount of this (unless you have a large salary or lottery win!) but todays First Time Buyers 100% have it way harder than when I was a FTB in the 90's no doubt. Who can save £30k at the age of 20 and buy a house??
> 
> I'd also add though that house hunting (especially when you have other dependants in your life) does not get any easier either! The more people you have to think about living in the house, the more compromises have to be considered and life choices made IMO


Back in the 90s every young person didn't have all the latest tech on finance, £40k cars on finance, all the latest designer gear and consider an extravagant foreign holiday as a necessity.

With the way many splash the cash it wouldn't be too hard for some to tighten their belts and save a bit.


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## PugIain

Kerr said:


> finance.


Dirty word, never had it, never want it.
I was brought up to believe if you can't afford it you don't have it.

I'd rather not end up with a black mark against my name for a TV or a poverty spec hatchback.

Only debt I owe, and plan to owe is my mortgage.

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## FJ1000

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## wish wash

Kerr said:


> Back in the 90s every young person didn't have all the latest tech on finance, £40k cars on finance, all the latest designer gear and consider an extravagant foreign holiday as a necessity.
> 
> With the way many splash the cash it wouldn't be too hard for some to tighten their belts and save a bit.


I agree, stupid tv shows like towie puts people in bubble land thinking that's how they should live. I have friends moan they have no money, but there cars are on pcp, they pay £60 a month for the latest ****e phone and go out at least once a week.


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## J306TD

I brought my first house at 21 (2011). This was a brand new 2 bed terrace in a great village with a town about 7 miles either side. 

Had some help of family members. But still had to save money each month and just worked as many hours as I could so I could save more. Was hard work but worth it in the end. 

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## kingswood

some great advice been given. 

i was born '81. bought 1st house in '06 when northern rock where doing 115% mortgages (i never got one). your 1st house is to get on the ladder and a roof over your head, 2nd house is where you look for all the thing you want (en suite, dinning room, garage in my move)

moved again in '13 when married and now looking for 3rd house, want a double garage and Victorian. cant afford it and still have the life style we want :-( 

some points to add what people have said:

1. it is harder now than the 80's/90's. granted interest rates aren't 16% but house prices then were alot lower. 

2. unfortunately we are the want it all now generation. 2 cars, multiply holidays, £1000 pound iphone 8's, to be fair we're a disgrace to the make do and mend attitude of the 50's/60's

3. it may seem like it will never happen but i know i felt like that before i bought my first one.

4. and youve done incredibly well to save so much money! well done :thumb:

5. despite what people have said about never having credit this is actually a BAD thing! as a proven record of paying debt helps your credit history. check yours on noodle.com. if you've never had credit get a credit builder credit card, spend £20-30 a month and pay off in full (wife had to do this)

6. when you do buy a house and get a partner make sure you dont get fleeced :lol:


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## wish wash

kingswood said:


> some great advice been given.
> 
> i was born '81. bought 1st house in '06 when northern rock where doing 115% mortgages (i never got one). your 1st house is to get on the ladder and a roof over your head, 2nd house is where you look for all the thing you want (en suite, dinning room, garage in my move)
> 
> moved again in '13 when married and now looking for 3rd house, want a double garage and Victorian. cant afford it and still have the life style we want :-(
> 
> some points to add what people have said:
> 
> 1. it is harder now than the 80's/90's. granted interest rates aren't 16% but house prices then were alot lower.
> 
> 2. unfortunately we are the want it all now generation. 2 cars, multiply holidays, £1000 pound iphone 8's, to be fair we're a disgrace to the make do and mend attitude of the 50's/60's
> 
> 3. it may seem like it will never happen but i know i felt like that before i bought my first one.
> 
> 4. and youve done incredibly well to save so much money! well done :thumb:
> 
> 5. despite what people have said about never having credit this is actually a BAD thing! as a proven record of paying debt helps your credit history. check yours on noodle.com. if you've never had credit get a credit builder credit card, spend £20-30 a month and pay off in full (wife had to do this)
> 
> 6. when you do buy a house and get a partner make sure you dont get fleeced :lol:


Thanks. Some good advice. I've had credit on cars in the past but not for ages. I've never even had a credit card. I'll have to get one as it improves your score apparently.


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## Pauly.22

I've been in my house 3 years now, it is a compromise, as we couldn't get the best area round and still have a reasonable size house and garden, but you have to start somewhere. 

My next house will be our forever home, I dislike the suburbs and city areas, but prices go crazy. Looking at 400k for anything we like the look of that more rural. which Is way off what we can't currently afford. 

Will stay here until we can.


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## Kerr

wish wash said:


> Thanks. Some good advice. I've had credit on cars in the past but not for ages. I've never even had a credit card. I'll have to get one as it improves your score apparently.


Credit cards are great when used correctly. They offer far more protection.

I use mine for all online purchases and for pretty much everything over £100.


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## DrEskimo

Kerr said:


> Credit cards are great when used correctly. They offer far more protection.
> 
> I use mine for all online purchases and for pretty much everything over £100.


I agree.

I use them but there is some very compelling evidence that you are far more likely to 'impulse buy' crap you don't need with one, than without one. I mean it makes sense as handing over physical cash is always much harder than tapping a bit of plastic to a machine...!

It's why companies love things Apple Pay and Amazon 'one click' buy. It removes the friction and emotion and reduces your time to think rationally about whether you actually need it.

As I say, I still use them for things like my train tickets as I might as well get rewards back on them, and for protection on big purchases like you say. But I probably do spend more than I would if I didn't have it....

Goes without saying that I always, without fail, pay them off in full every month. I always keep track and make sure it's following my budget too.


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## PugIain

My credit card gets used when I buy tat I don't need on ebay 
Probably has £100 on it at a time that gets paid off at the end of the month when my bill comes in. I only use it for the protection it gives.


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## Andyg_TSi

It comes down to compromise.

I left home quite late in life (aged 33), purely due to not wanting to pay rent on a propertly that id never own.

Therefore, when i was 23, I put in place a 10 year plan and during those 10 years I cut back on my frivolous purchaces and spending every weekend on the razzle dazzle with my mates.
I also took on an extra job in order to earn more money to save up.

So.....why go out every weekend and basically throw the thick end of £100 up the wall on beer?. You can go out 2 weekends a month and save the rest up.

Do you really NEED the latest gadget, latest phone, latest fashion etc.

My 10 year plan netted me around £35k in savings, enabling me to put down a 12.5% deposit on a house & buy everything outright to furnish every room, redecorate from top to bottom and get it how I wanted it.

This was right at the peak if the housing bubble in 2007 before the crash.

Set yourself a goal and work towards it. YOU WONT REGRET IT.

The ONLY debt i have now is my mortgage and a very small amoubt in a credit card (less than £500)
I dont have anything on HP and I never buy cars on PCP/finance either.

You have to play the long game and look at the bigger picture. Sacrifice now for where you want to be in the future.


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## c87reed

Location is the compromise that I went with. I had to chose between a pokier house in a lovely area and a largish house with a garage etc in a less desirable area. I went with the latter and I am glad that I did, to date the estate has proven to be nice and am so pleased to have the extra size of the house and garage. We don't 'need' to move in the future if we don't want to now.

I am glad we didn't choose to stretch ourselves to much trying to achieve both of the above.


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## Chris Dyson

wanner69 said:


> Way harder? When we had a mortgage starting in the 1980s our interest rates were up to 18% and not like the 0.5% etc they've been for years.


Exactly right.

When we had a mortgage, also in the late eighties and nineties, the interest rates NEVER went below 10% and went up to 15% for us. I would say it is actually easier for first time buyers today with super low interest rates, and Government backed 'help to buy' schemes that were not around back then. House prices were lower but then so were wages.

Knuckle down to some hard saving, and yes, if you really want a house, there will need to be some compromises early on. Good luck


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## Taxboy

Buying any home is a compromise. However there's some great advice on here. Unless your 6 numbers have come up you will need to decide what is most important to you. If it's getting a house the that's where the focus of your efforts should lie. If you still want holidays, new car, flash phone etc then that's also OK but in that case the house idea will need to go on the back burner. People seem to forget that you can only spend money once 

The only real advice I can offer is that the best way of giving yourself a payrise is to cut back on your spending. I found it helps to draw up a spreadsheet and for a couple of months list in detail all your spending and then split it into mandatory and discretionary. You need to be ruthless on what is discretionary e.g. sky sports is not mandatory !! You may (or may not ) be surprised how much of your spending is on things that you don't NEED

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## wish wash

Thanks for the info so far guys. While I can appreciate many used to pay 10% mortgages, deposits were much smaller. You only seem to get very low % with a large deposit. We all know the interest rates have to go up in the future from the Bank of England


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## Andyg_TSi

wish wash said:


> Thanks for the info so far guys. While I can appreciate many used to pay 10% mortgages, deposits were much smaller. You only seem to get very low % with a large deposit. We all know the interest rates have to go up in the future from the Bank of England


Yes, the banks have changed their lending criteria to ensure 'affordability' of the borrower to pay the mortgage.

you seem to be in a better position than most with a £40K deposit.

I bought on my own. If it was me, I'd be going for a £150K terrace now & putting a 25% deposit down (£37.5k) on a 1st time buyer mortgage deal (no fees preferable) - 75% LTV (Loan to Value)

House prices are only going one way.....up. That £150K terrace today, could be £180K in 5 years time, in addition to you paying off some of the £112K mortgage.

If you've paid off 'say' £12K of the capital in 5 years & the house is valued at £180K, you've effectively doubled your savings by having £80K equity in the house.

This will enable you to be in a better position to move into something bigger 5 years from now. No one ever buys that £500K mansion first off the bat unless they're a lotto winner


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## alfajim

Wise words ^^^^
This is what I did. 
Being single I basically ****ed all my money up the wall till I was 30. Then saved up a wedge and got a house. It's increased in value by 80k in five years, putting me in a position to be able to find that forever home. 
Money is a bit tight but you can't live a champagne lifestyle on a lemonade budget. 
Also I've been and done loads of stuff, so I don't feel like I'm missing out on anything.


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## Iwill89

So many wise thoughts here. It might a fine start for a full-fledged investment thread


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## Fentum

Also, the capital gain on your main house is the only (substantial) amount of money you'll make (not earn) which does not get taxed to buggery. Unless you are remarkably lucky, this is about the only way normal (i.e. waged or salaried) people can accrue wealth in this country. And that tax break may not last - the LibDems have their eyes on it and I doubt that Corbyn's mob will resist the temptation...although it would be a courageous move to try to tax this.

Peter


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## Andyg_TSi

Fentum said:


> Also, the capital gain on your main house is the only (substantial) amount of money you'll make (not earn) which does not get taxed to buggery. Unless you are remarkably lucky, this is about the only way normal (i.e. waged or salaried) people can accrue wealth in this country. And that tax break may not last - the LibDems have their eyes on it and I doubt that Corbyn's mob will resist the temptation...although it would be a courageous move to try to tax this.
> 
> Peter


Labour wouldnt dare. There has never been capital gains to pay where there is profit on the sale of your primary main residence, especially when the sale is only to fund the purchase of another primary main residence.

Neither of the two main political parties would.

There are other exemptions that can apply where people have bought another house and there former main residence is then turned into a rental property. But that is an entirely different matter of course.


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## DrEskimo

Andyg_TSi said:


> Labour wouldnt dare. There has never been capital gains to pay where there is profit on the sale of your primary main residence, especially when the sale is only to fund the purchase of another primary main residence.
> 
> Neither of the two main political parties would.
> 
> There are other exemptions that can apply where people have bought another house and there former main residence is then turned into a rental property. But that is an entirely different matter of course.


Yea I think that would go down like a lead balloon in this country. We are obsessed with home ownership....

As you say, any equity you have tied up in property is only released when you sell it, and unless you plan on living in a camper van, will be used to pay for another property, where you get taxed to the armpits via stamp duty!


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## Andyg_TSi

DrEskimo said:


> Yea I think that would go down like a lead balloon in this country. We are obsessed with home ownership....
> 
> As you say, any equity you have tied up in property is only released when you sell it, and unless you plan on living in a camper van, will be used to pay for another property, where you get taxed to the armpits via stamp duty!


Yeah, stamp duty is only payable if the house price is over a certain threshold.
I beleive they've just upped the 1st threshold from 125K to 300K in the last budget.
So unless the house your buying is £300,001+ you wont pay stamp duty either


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## wayne451

Andyg_TSi said:


> Yeah, stamp duty is only payable if the house price is over a certain threshold.
> I beleive they've just upped the 1st threshold from 125K to 300K in the last budget.
> So unless the house your buying is £300,001+ you wont pay stamp duty either


Also lower threshold if below £500k on your first property.

You also pay an extra 3% on any additional properties, unless you have 15+ premises or the purchase price is below £40k.


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## DrEskimo

Andyg_TSi said:


> Yeah, stamp duty is only payable if the house price is over a certain threshold.
> I beleive they've just upped the 1st threshold from 125K to 300K in the last budget.
> So unless the house your buying is £300,001+ you wont pay stamp duty either


Ah yes some additional relief then!

Unfortunately house prices are pretty ridiculous round my neck of the woods. Average house price is £725k last I looked....

So I have a rather large bill when it comes to stamp duty!


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## shycho

wanner69 said:


> Way harder? When we had a mortgage starting in the 1980s our interest rates were upto 18% and not like the 0.5% etc they've been for years.


I'd much rather pay 18% interest on a packet of biscuits than 0.5% interest on a brand new Ferrari.


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## Nidge76

Also I'd love to know where I can get a mortgage rate of 0.5%. 

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## ollienoclue

You won't get a mortgage at 0.5%.

It is obvious that the country desperately needs a more equitable society. You can argue back and forth about taxation but it is obvious something needs to radically change.

When Corbyn gets in the rich are going to be hounded and it is about time.


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## kh904

ollienoclue said:


> You won't get a mortgage at 0.5%.
> 
> It is obvious that the country desperately needs a more equitable society. You can argue back and forth about taxation but it is obvious something needs to radically change.
> 
> When Corbyn gets in the rich are going to be hounded and it is about time.


Sorry but Corbyn will destroy the economy.
He is a bit more polished now as leader but he and McDonell are still Marxists.
They'll drive out capital from the country as nobody will risk investing here when if you make a profit or have assets, the Government will disproportionally tax you at a very high rate or have a high risk of them confiscating your assets.
We have pretty good property rights (ownership of private assets) in this country, making it safe and stable to invest without the fear of the Government taking it away.

Just look at Venezuela!


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## wayne451

ollienoclue said:


> You won't get a mortgage at 0.5%.
> 
> It is obvious that the country desperately needs a more equitable society. You can argue back and forth about taxation but it is obvious something needs to radically change.
> 
> When Corbyn gets in the rich are going to be hounded and it is about time.


Why is it about time?

The top 1% of earners pay almost 30% of the total income tax.

They are rich as they have put effort in, invested in their own futures through education or enterprise.

Why should they have to give out more money so some lazy, feckless yoyo-knickered smack-rat can spit out kids, not work and get handouts?

If people want their share of wealth, let them get off their backside and earn it, it really is that simple.

Corbyn is a joke. It's always Labour voters that have this feeling of entitlement to other people's money. Really gets on my wick.


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## kingswood

wayne451 said:


> Why is it about time?
> 
> The top 1% of earners pay almost 30% of the total income tax.
> 
> They are rich as they have put effort in, invested in their own futures through education or enterprise.
> 
> Why should they have to give out more money so some lazy, feckless yoyo-knickered smack-rat can spit out kids, not work and get handouts?
> 
> If people want their share of wealth, let them get off their backside and earn it, it really is that simple.
> 
> Corbyn is a joke.


from one extreme to another!

im sure theres somewhere inbetween 

im a strong labour supporter but cant help think corbyn isnt the answer.

and the rich are rich as they've exploited the poor - think zero hours.

but saying that we shldnt be giving money hand over fist to lazy lay abouts but if that stops who suffers? the poor kids they have.

as much as it pains me tersea may has made some good decisions regarding increasing minimum wage, and limiting handouts to the same as the avergae wage.

lets not bring immigration and brexit into the conversion! :lol:


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## stealthwolf

Going back on topic, I bought my first house about two years ago. I lived away during university and my first few years of work, before moving back home. I stayed with my parents for about six years so I could build a deposit. I'm mid-30s now.

The area I wanted to move to is quite popular and houses were being snapped up within a week of going on sale. I was limited in what I could obtain. My minimum requirements were three bedrooms, a garage (either large enough to store a car or at least some decent storage space), and a downstairs toilet (most had just upstairs toilet in the bathroom). I would loved to have had a detached house and double garage but that would be well outside of my price range.

I paid a structural surveyor (£300) + conveyancing solicitor (£1200) + stamp duty fees as well (it was under the older scheme so 5% band, under the new scheme it'd be 0!).


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## wayne451

kingswood said:


> from one extreme to another!
> 
> im sure theres somewhere inbetween
> 
> im a strong labour supporter but cant help think corbyn isnt the answer.
> 
> and the rich are rich as they've exploited the poor - think zero hours.
> 
> but saying that we shldnt be giving money hand over fist to lazy lay abouts but if that stops who suffers? the poor kids they have.
> 
> as much as it pains me tersea may has made some good decisions regarding increasing minimum wage, and limiting handouts to the same as the avergae wage.
> 
> lets not bring immigration and brexit into the conversion! :lol:


I worked on a zero hour contract as a student and loved it. Chose when I started/finished, what days I went in etc. Was awesome.

If I had my way I'd really shake up the benefits system. That's the source of most of the countries problems in my eyes.

To get their benefits they'd have to turn up and perform tasks, even if it was one bunch of bums going round digging holes and another bunch of bums following them around and filling them in. If they don't turn up one day, they lose that day's benefit money. Have an attendance policy in place so if they go over that they get no benefits at all for a month, they can then re-apply for a lower ranked task, each time getting progressively worse (and less money) until they are picking up dog poo. Those that excel could get development roles or extra responsibilities to boost up their CV's and equip them for normal roles away from benefits. It'd educate the bums in to having a work ethic - by hook or by crook.

I'd also abolish all housing benefits. Naturally you need an infrastructure in place first so all things like empty mills would be converted, in much a fashion as a Travel Inn or the like - corridor after corridors of single rooms with a bed and a sofa with a small wash room. Those on housing benefit that aren't working would be moved in to these places.

It'd free up council housing for the working poor, elderly and disabled (properly disabled, not the Mickey taking spongers you see on TV who once stubbed their toe on the dining room table in 1978!). The private sector landlord market would massively rebase itself, house prices would come down etc.


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## robertdon777

Yes it will be a compromise

But just get one purchased, the longer you wait the more they go up! (usually)

So get it purchased (the most expensive you can afford in the best area you can afford - this is important (area wise).

You will feel skint...But in 3-5 years from now, you will own a property with some equity and you'll be used to paying out. So move again and stretch yourself in the best area you can afford. Repeat a couple of times and you'll be in a great area with a great house .

Obviously many things can change and go wrong with interest rates blah blah, but near everyone will be in the same postion so the house prices are all swings and roundabouts.

You can choose not to stretch yourself though and buy well within your price ceiling, then spend more on cars/holidays etc etc. No correct way to do anything...just do whatever makes you happy.


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## robertdon777

wanner69 said:


> Way harder? When we had a mortgage starting in the 1980s our interest rates were upto 18% and not like the 0.5% etc they've been for years.


Anyone who's purchased a house in the last 30 years would surely know that its harder to get on the ladder for FTB now than previous.

Its to do with lending.

Buy a 100K house 20 years ago. £5K deposit or less.

Buy a 100K house now. £20K deposit or more is what they are asking.

The wage in reality has stayed quite stagnant, but the higher house prices have only gone to bump up the £100K house even more, thus bumping up the already increased deposit required.

Simply put, to own your house now, the bank will want a Bigger Deposit and a Bigger percentage of your Wages each month to own the same property if it was sold to you in the 80's-90's (with you working the same job).

I count myself lucky I purchased a house in 2000, just before the price increases of 2001-2007. After those years it became harder to get a good mortgage deal.

High Rates come with low priced houses, we won't see that for a long time. Its all about % of wages spent on a house...its never been greater.


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## Kerr

House prices fell in December.

https://www.google.co.uk/amp/s/amp..../08/uk-house-prices-fall-halifax-wages-buyers

With so much uncertantity it makes things a bit more risky. We will never see property value rises like we have in the last 10-15 years. I think they might go down.


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## LeeH

In some areas...


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## Kerr

robertdon777 said:


> Anyone who's purchased a house in the last 30 years would surely know that its harder to get on the ladder for FTB now than previous.
> 
> Its to do with lending.
> 
> Buy a 100K house 20 years ago. £5K deposit or less.
> 
> Buy a 100K house now. £20K deposit or more is what they are asking.
> 
> The wage in reality has stayed quite stagnant, but the higher house prices have only gone to bump up the £100K house even more, thus bumping up the already increased deposit required.
> 
> Simply put, to own your house now, the bank will want a Bigger Deposit and a Bigger percentage of your Wages each month to own the same property if it was sold to you in the 80's-90's (with you working the same job).
> 
> I count myself lucky I purchased a house in 2000, just before the price increases of 2001-2007. After those years it became harder to get a good mortgage deal.
> 
> High Rates come with low priced houses, we won't see that for a long time. Its all about % of wages spent on a house...its never been greater.


This is the bit I don't understand about the finance market just now.

Banks are irresponsible for giving a mortgage for a house that shouldn't depreciate without lots of checks and a big deposit.

On the other hand you can get a brand new depreciating car worth £50k+ on finance, little checks done, zero deposit and that's deemed ok.


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## wish wash

Isn't this why there saying pcp deals is going to be the next ppi.


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## LeeH

wish wash said:


> Isn't this why there saying pcp deals is going to be the next ppi.


Really?

I think it's the next financial bubble to burst, no one is getting mis sold pcp/lease deals.

Sent from my iPhone using Tapatalk Pro


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## Kerr

LeeH said:


> Really?
> 
> I think it's the next financial bubble to burst, no one is getting mis sold pcp/lease deals.
> 
> Sent from my iPhone using Tapatalk Pro


You should read car forums. People are signing up to PCP deals and don't understand them at all. It's a very common issue.

Dealers do push people into PCP deals.

PPI seemed obvious to me too, but that was ruled to be missold to most people.

There was an interesting thread on another forum where the dealer puts a new car to a third party for modifying on a PCP contract (against the terms and conditions) adds the cost of the modifications to the finance deal and advised people they shouldn't have any issues with warranty claims either.


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## wish wash

You could be right. Difference between Mis sold and Mis bought. It's up to you to check before you sign, same with a morgage


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## kingswood

robertdon777 said:


> )
> 
> So get it purchased (the most expensive you can afford in the best area you can afford - this is important (area wise).
> 
> You will feel skint...But in 3-5 years from now, you will own a property with some equity and you'll be used to paying out.
> .


and in 3-5 years you can be in negative equity and unable to move, stuck in a house with more debt than its worth.

to say someone should buy the most expensive they can is poor advice. thats why so many young buyers are been duped into buying brand new houses, mortgaged to the hilt and only ever knowing .5% mortgages.

love the way on new house brochures the first pictures are one of dinner parties and glasses of wine.


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## robertdon777

kingswood said:


> and in 3-5 years you can be in negative equity and unable to move, stuck in a house with more debt than its worth.
> 
> to say someone should buy the most expensive they can is poor advice. thats why so many young buyers are been duped into buying brand new houses, mortgaged to the hilt and only ever knowing .5% mortgages.
> 
> love the way on new house brochures the first pictures are one of dinner parties and glasses of wine.


And as per the whole quote I did mention other ways to buy (well within your ceiling price). And there are no right and wrong way. You can't just requote part of a statement.

But I still stand by "purchase the most you can afford (in your mind) in the best area" This will always work out better than buying something for the same kind of value but in a lesser area.

There is a big difference in

"the most expensive you can afford"

&

"the most expensive house the Bank will lend you money for"


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## kingswood

robertdon777 said:


> And as per the whole quote I did mention other ways to buy (well within your ceiling price). And there are no right and wrong way. You can't just requote part of a statement.
> 
> But I still stand by "purchase the most you can afford (in your mind) in the best area" This will always work out better than buying something for the same kind of value but in a lesser area.
> 
> There is a big difference in
> 
> "the most expensive you can afford"
> 
> &
> 
> "the most expensive house the Bank will lend you money for"


Quoting all 

i understand what you mean but unfortunately the younger (want it all now) generation dont understand the difference :-/


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## robertdon777

kingswood said:


> Quoting all
> 
> i understand what you mean but unfortunately the younger (want it all now) generation dont understand the difference :-/


Yes they will take whatever someone offers them... which as you stated can quickly turn into a negative situation.

Once this happens the only way out is to sit in the property for much longer than anticipated.


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## wish wash

This is why I'm happy to carry on saving to increase my deposit. I don't want a massive morgage payment every month. I want money left over every month to do things to the property. Interest rates will go up so I'm trying to guess what % it may be in 5 years time, I'm trying to plan ahead so I'm in a good financial position


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## DrEskimo

wish wash said:


> This is why I'm happy to carry on saving to increase my deposit. I don't want a massive morgage payment every month. I want money left over every month to do things to the property. Interest rates will go up so I'm trying to guess what % it may be in 5 years time, I'm trying to plan ahead so I'm in a good financial position


I think this is certainly sensible, but I am more inclined to agree with robertdon77....

The issue you have (as I've seen you write in other threads actually), is that house prices are rising quicker than people can save. Stagnant wage growth and increasing inflation has meant people can't increase their savings as fast as house prices are rising.

I bought my first flat in 2012 with my partner. We had a decent deposit and in the end bought a flat higher than our initial budget. The payments were still manageable (<20% take home pay), but it was still daunting taking on such a big figure (relative to us!). We sold it three years later and I worked out that the increase in the value of the flat over that time was the equivalent to me and partner saving £2.5k per month, on top of the mortgage payments. With the same salaries and deposit amount today, we wouldn't be able to afford that flat..
The quicker you can get yourself on the ladder the better, and currently it's a very good time to buy. The market is quiet and mortgage rates are still very low. You're young and should take advantage of your ability to borrow (with sensible limits of course), whilst you hopefully have a bright future of an increasing salary and more disposable income.

Obviously how you chose to spend that is up to you, but I am more than happy I decided to put it towards a property, which has set me up so well for my future (and allowed me to be in the house I am now), than spent lots of it on renting new expensive cars for a few years or going on holidays. I still did (and regretted ) those things after! Of course, we are all different though :thumb:

But as Kingswood rightly says, it's still debt and it's still a risk. For me, there are three major things that determine the value of a property; location, location and location...I'm fortunate in that I live in the South East, and property prices are very strong and have risen a great deal, second only to London. Like any investment, you need to do your research. Look at house prices and see how they have performed. Is the area nice, does it have good schools and a good train link for commuters, etc.? There are ways you can reduce your risk. It's no different to picking funds to invest in.

Of course no one can know what the market will look like in 3/5/10yrs time, but if the repayments are sensible (I would try to keep them <25% of your take home) and you've bought in a good area, are in a good place financially with emergency funds and limited your other debt, it should be a sound investment and you should be well prepared to ride out the economic storms when (not if....) they hit.

My 2ps worth...

I can't imagine ever trying to do it on my own though, so best of luck with it mate.


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## danwel

I think personally that buying any house there will be a certain amount of compromise so you need to find something that you are happy with.

I am 3 years in my current new build and whilst i like it i would still like a bigger garden and garage but unless i win the lottery then i won't be getting my "dream home" any time soon


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## wish wash

DrEskimo said:


> I think this is certainly sensible, but I am more inclined to agree with robertdon77....
> 
> The issue you have (as I've seen you write in other threads actually), is that house prices are rising quicker than people can save. Stagnant wage growth and increasing inflation has meant people can't increase their savings as fast as house prices are rising.
> 
> I bought my first flat in 2012 with my partner. We had a decent deposit and in the end bought a flat higher than our initial budget. The payments were still manageable (<20% take home pay), but it was still daunting taking on such a big figure (relative to us!). We sold it three years later and I worked out that the increase in the value of the flat over that time was the equivalent to me and partner saving £2.5k per month, on top of the mortgage payments. With the same salaries and deposit amount today, we wouldn't be able to afford that flat..
> The quicker you can get yourself on the ladder the better, and currently it's a very good time to buy. The market is quiet and mortgage rates are still very low. You're young and should take advantage of your ability to borrow (with sensible limits of course), whilst you hopefully have a bright future of an increasing salary and more disposable income.
> 
> Obviously how you chose to spend that is up to you, but I am more than happy I decided to put it towards a property, which has set me up so well for my future (and allowed me to be in the house I am now), than spent lots of it on renting new expensive cars for a few years or going on holidays. I still did (and regretted ) those things after! Of course, we are all different though :thumb:
> 
> But as Kingswood rightly says, it's still debt and it's still a risk. For me, there are three major things that determine the value of a property; location, location and location...I'm fortunate in that I live in the South East, and property prices are very strong and have risen a great deal, second only to London. Like any investment, you need to do your research. Look at house prices and see how they have performed. Is the area nice, does it have good schools and a good train link for commuters, etc.? There are ways you can reduce your risk. It's no different to picking funds to invest in.
> 
> Of course no one can know what the market will look like in 3/5/10yrs time, but if the repayments are sensible (I would try to keep them <25% of your take home) and you've bought in a good area, are in a good place financially with emergency funds and limited your other debt, it should be a sound investment and you should be well prepared to ride out the economic storms when (not if....) they hit.
> 
> My 2ps worth...
> 
> I can't imagine ever trying to do it on my own though, so best of luck with it mate.


Thanks for the wise worse. I get what your saying. If I save an extra 12k this year but house prices increase by a set % I might only be 5k better off etc. Im trying to not get too emotionally attached. It's easy to get excited and jump in with both feet then reality sets in and you may regret choices.


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## DrEskimo

wish wash said:


> Thanks for the wise worse. I get what your saying. If I save an extra 12k this year but house prices increase by a set % I might only be 5k better off etc. Im trying to not get too emotionally attached. It's easy to get excited and jump in with both feet then reality sets in and you may regret choices.


As others have said before me, you have done extremely well to save £40k. That's an incredible amount of money and I too would be very cautious before I went ahead and did anything with it!

Most people would love to be in your position, so don't underestimate how well you are doing :thumb:


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## dave-g

My partner and I have (almost) got into our first house, I'm 31. We've done the help to buy, gone for the best we can afford within a comfortable monthly budget. Still needed 14.5k deposit, along with fees on top. 

A lot of compromises have been made, but also holding out for the best area around us, and the most suitable long term living arrangements, so that it lasts for a while! 

It's daunting, very daunting, and sometimes wonder if it's right, but I can't go on renting and moving around time after time!


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## robertdon777

wish wash said:


> Thanks for the wise worse. I get what your saying. If I save an extra 12k this year but house prices increase by a set % I might only be 5k better off etc. Im trying to not get too emotionally attached. It's easy to get excited and jump in with both feet then reality sets in and you may regret choices.


What i would look at doing with your deposit....

Put some of it down but also ENJOY some that you've saved. A great holiday after moving into a house would be the icing on the cake.

If you have £40K saved, don't spunk it all as the deposit because once you move in saving will be much harder than before. £30K deposit, £5K backup fund for house stuff (repairs are usually required on a second hand house) and £5K to enjoy yourself (which is what is really important in life)

Good luck and just get on the ladder as soon as you can.


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## insanejim69

We had to compromise with our first house . We bought it coming up for 3 years ago. Only needed £10500 for deposit and fees and was fixed for 2 years. Renewed with the same mortgage company earlier this year for a fixed 5 year deal at 1.28%, which ended up saving us around £180 a month on mortgage payments. So we aim to save now and at the end of our current 5 year fixed deal start to look at a bigger house and possibly moving.

Of course with £40k deposit you can afford to take your time and be as picky as you like Imo. But as above I personally would be putting £30k of that into the deposit and have a good decent amount as a back up.

James.


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## DrEskimo

insanejim69 said:


> We had to compromise with our first house . We bought it coming up for 3 years ago. Only needed £10500 for deposit and fees and was fixed for 2 years. Renewed with the same mortgage company earlier this year for a fixed 5 year deal at 1.28%, which ended up saving us around £180 a month on mortgage payments. So we aim to save now and at the end of our current 5 year fixed deal start to look at a bigger house and possibly moving.
> 
> Of course with £40k deposit you can afford to take your time and be as picky as you like Imo. But as above I personally would be putting £30k of that into the deposit and have a good decent amount as a back up.
> 
> James.


Sorry for hijacking the thread, but...

Do you mind if I ask who that mortgage was with James?
Was it based on a set limit/LTV?

Mortgage is due renewal in March and 5yr fixed at 1.28% would be lovely!


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## insanejim69

(Yorkshire building society) was before the rates went up again though. Originally our mortgage was 95% LTV. But with our payments and also our house value increasing it's now around 79.8% iirc back in may when our renewal came up. We could have had a lower rate again (around 1.18% , but was only a 2 year fixed deal) .was all done within 30 mins over the phone to them as well. 

James.


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## wish wash

robertdon777 said:


> What i would look at doing with your deposit....
> 
> Put some of it down but also ENJOY some that you've saved. A great holiday after moving into a house would be the icing on the cake.
> 
> If you have £40K saved, don't spunk it all as the deposit because once you move in saving will be much harder than before. £30K deposit, £5K backup fund for house stuff (repairs are usually required on a second hand house) and £5K to enjoy yourself (which is what is really important in life)
> 
> Good luck and just get on the ladder as soon as you can.


I think I will hold back some money. 10K equates to about £50 added per month on a mortgage. With 10K you can do a lot and all the houses/ bungalows I am looking at need work, which is what I want. With being in construction all my life nothing puts me off and I can do 80% of the work myself, bar electrics. I also have the benefit of having trade accounts, so a 8K kitchen I could buy for around 3k.


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## shabba

In my opinion, buying a house is always a compromise between the priorities you set for yourself. 
And that's what it comes down to in the end. As for If you want it all, but you'll have to take up a huge mortgage meaning no vacations, no new cars, and working much more in order to be able to afford it all.

I made myself a spreadsheet compiling all the pros and cons of owning property, the priorities and my financial 5 year plan.
Factoring in that house costs money apart from the mortgage (unforeseen repairs, renovations, electricity, gas and water costs...), plus with today's banks..you never know by how much the interest rate can climb in the years to come :/


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## DrEskimo

insanejim69 said:


> (Yorkshire building society) was before the rates went up again though. Originally our mortgage was 95% LTV. But with our payments and also our house value increasing it's now around 79.8% iirc back in may when our renewal came up. We could have had a lower rate again (around 1.18% , but was only a 2 year fixed deal) .was all done within 30 mins over the phone to them as well.
> 
> James.


Nice one, cheers James :thumb:



wish wash said:


> I think I will hold back some money. 10K equates to about £50 added per month on a mortgage. With 10K you can do a lot and all the houses/ bungalows I am looking at need work, which is what I want. With being in construction all my life nothing puts me off and I can do 80% of the work myself, bar electrics. I also have the benefit of having trade accounts, so a 8K kitchen I could buy for around 3k.


Sounds like you are in an even stronger position to also add value to anything you buy too!

This is what we did with our second property. It was a bit cheaper (although not much, because everyone else, and especially developers all have the same idea...) as it needed a fair bit of work. We ended up doing much more than say, a developer, but we obviously weren't looking at it purely as an investment, but also as a home we wanted to live in for at least the next 3yrs. We spent way more on floors, tiles and bathrooms than any developer would because we have value in enjoying them!

That's the way I approach it. You will never get your forever home first, so its about building your way up and moving up the ladder. While a home is a home first, I am still mindful about its ability to build equity and its ability to help me get to the next step in the ladder. Equity + additional savings + increased borrowing from a hopefully increasing salary all allow you to do this, so buying places where you can maximise the equity part of the equation is always helpful, and for me, location is the most important factor that determines this.

You have to decide what sort of balance you want to strike personally


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## DrEskimo

shabba said:


> plus with today's banks..you never know by how much the interest rate can climb in the years to come :/


I agree, but this will also have an effect on rental prices.

Rental prices will definitely keep rising. 5/10yrs ago rental was much cheaper than it is now, and in 5/10yrs it will most likely be much more expensive than it is now.

The long-term gain with buying a house is that you can effectively fix the amount you spend on mortgage payments, ultimately with the aim of making it £0 when you have paid it off in full!

Add to that the fact that you are owning an asset that, by and large, appreciates, and it is also a sound investment for your income.


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## FJ1000

shabba said:


> In my opinion, buying a house is always a compromise between the priorities you set for yourself.
> 
> And that's what it comes down to in the end. As for If you want it all, but you'll have to take up a huge mortgage meaning no vacations, no new cars, and working much more in order to be able to afford it all.
> 
> I made myself a spreadsheet compiling all the pros and cons of owning property, the priorities and my financial 5 year plan.
> 
> Factoring in that house costs money apart from the mortgage (unforeseen repairs, renovations, electricity, gas and water costs...), plus with today's banks..you never know by how much the interest rate can climb in the years to come :/


I love a good spreadsheet!

I have something very similar - I track all my incomings and outgoings, project forwards so I can budget for big expenses etc ... have been doing it for 10 years now so loads of data in there!

I also turned to spreadsheets in the house hunting stage - putting together interesting properties with associated costs (council tax, service charges, building works etc), working out price per square foot where possible.

On that last point - I don't think we use price/unit area metrics enough for residential properties in the UK. It's quite commonplace for commercial property.

My spreadsheet at the moment includes my plans/pipedream to build a house from scratch in ~3-4 years time

Sent from my iPhone using Tapatalk


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## wish wash

Anyone got advice on best place for a morgage. Do I go with my current bank or go through a broker. Are you better paying your morgage fees off upfront or add it to the morgage. I feel like I've still got a lot to learn


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## robertdon777

wish wash said:


> Anyone got advice on best place for a morgage. Do I go with my current bank or go through a broker. Are you better paying your morgage fees off upfront or add it to the morgage. I feel like I've still got a lot to learn


Have a look on the usual comparison sites and then go and see a broker, they do sometimes have very good deals. Just beaware that they will make money from your deal so don't let them channel you down a route of mortgage type your not happy with.

Fees are swings and roundabouts, your better off paying it in theory rather than on the mortgage. But with rates so low the (say) £1000 fee you pay off might be better on the mortage and then use the surplus £1000 towards the house when you move in rather than say buying a £1000 cooker on finance at 15% (just an example)


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## ffrs1444

wish wash said:


> Anyone got advice on best place for a morgage. Do I go with my current bank or go through a broker. Are you better paying your morgage fees off upfront or add it to the morgage. I feel like I've still got a lot to learn


Try London and country fee free they get commission from the lender I was going to do this and then the Morgage Adviser at the Estate agent said he will do it for free then so did that


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## kingswood

wish wash said:


> Anyone got advice on best place for a morgage. Do I go with my current bank or go through a broker. Are you better paying your morgage fees off upfront or add it to the morgage. I feel like I've still got a lot to learn


as a rough guide anything over £150000 your better off paying a fee and adding it to the mortgage as the lower rate will be benifical over the life on the mortage, anything under £150000 your best off egtting a free product with a higher interest rate.

always look at the price per £1000 when you compare mortgages


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## Sicskate

wish wash said:


> Anyone got advice on best place for a morgage. Do I go with my current bank or go through a broker. Are you better paying your morgage fees off upfront or add it to the morgage. I feel like I've still got a lot to learn


We've just bought our first home.

We paid a broker £300 to find a mortgage with a decent rate, in the end we chose Coventry (no fee) and got £500 cashback.

So we actually made £200 from going to the broker.

He also shopped around for insurance and sorted out the survey too.

There was no stress or confusion so I'm happy we did it the way we did.

Sent from my FRD-L09 using Tapatalk


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## insanejim69

Sicskate said:


> We've just bought our first home.
> 
> We paid a broker £300 to find a mortgage with a decent rate, in the end we chose Coventry (no fee) and got £500 cashback.
> 
> So we actually made £200 from going to the broker.
> 
> He also shopped around for insurance and sorted out the survey too.
> 
> There was no stress or confusion so I'm happy we did it the way we did.
> 
> Sent from my FRD-L09 using Tapatalk


Same here, our broker and solicitor fees etc were around £2000k in total and worth it Imo. He found a mortgage company that didn't just say yes or no like most high street lenders do. They came back with a few things I needed to do in my financial situation etc and then it was all approved, took around 4 weeks in total from starting the process to moving into the house. Like you, he also sorted out life insurance, house insurance and insurance incase we lost our jobs etc etc. Was a genuine trouble free and worry free experience.

James.


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## no1chunk

I know its a few weeks late but i live in dagenham essex and to buy around here a flat will cost you around 150k and the house i currently own is only 3 small bed but would fetch around 280k. But as mine and my wifes secure jobs are here we couldnt afford to move further out were its cheaper as the traffic is always bad so would takes ages to commute. I work 12hr night shift start at 5pm finish 5am and is 1.8miles form my house it takes me 30mins to do because of all the school mums picking there kids up. I have 5 schools in a 2.5mile radious.


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