# Joint Savings Account for House Deposit



## electric_cooper (Feb 28, 2008)

Me and the misses are looking to open a joint savings account to save up for the house deposit

My initial thought was that we would simply search for the joint account account with the best AER but having thought about it, I am now thinking it may be worth going with a bank/provider that we may be getting our future mortgage with as we may get preferential rates for being an existing customer when it comes to making the mortgage application?

I know HSBC offer very good mortgages for first time buyers on a 10% deposit basis but only to existing customers but their joint savings account only pays out 0.05%. Compared with the 3% offered by other providers on joint savings account who are non-mortgage providers or dont offer as good a deal on mortgages

Just wanting some advice on how people think would be the best way to go about it? The plan is to save as much as possible in the next 6 months. We then intend to rent for 12 months (to get an idea of the cost of living, food, bills, etc) and leave the amount we have saved in a savings account which we will top up on a monthly basis. After that, we will then look into getting a mortgage and buying our own place.

Any advice would be muchos appreciated :wave:


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## Dixondmn (Oct 12, 2007)

my advice would be to go for the highest interest rate you can get, be it with your existing institution or elswhere.

my other piece of advice is.... dont rent. - you're paying someone elses mortgage, with your hard earned money. I've never understood, the need to estimate costs of food, water, etc etc. you will live according to your means once you have a mortgage.

Good luck in what ever you decide.


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## bjarvis2785 (Oct 4, 2008)

can you not get the highest AER then a few months prior to mortgage application transfer the savings to whoever you are applying for mortgage with?

I agree on the above though regarding renting - it's a nice idea, but not worth it IMO. The 1 years rent could be topping up your savings


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## s2kpaul (Jul 27, 2006)

i would use a building society or such. However we got our 1st mortgage with Britannia who beat everyone for affordability.

Another thing is to have your deposit and a bit extra  1st month you will pay double mortgage.


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## electric_cooper (Feb 28, 2008)

We are still debating over the renting idea so that is a side issue

Just looking for the best way to benefit as much as possible from a savings account whilst ensuring we are in the best position to get the best possible mortgage deal


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## dogs_basket (Aug 28, 2007)

I'd just go for the best rate you can. You can't know what the best mortgage will be in over 18 months time, so I wouldn't tie yourself to it now. Don't forget to make the most of your ISA - rate might be slightly lower at first sight but nil tax can make all the difference. 

We did the same as you with regard to renting. It helped get us used to knowing what we'd have. Maybe you loose a years repayments but it can get you a good deal on the house you buy.

Good luck. (We did a similar thing and were mortgage free on a 3 bed detached just after turning 30).


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## Dixondmn (Oct 12, 2007)

dogs_basket said:


> I'd just go for the best rate you can. You can't know what the best mortgage will be in over 18 months time, so I wouldn't tie yourself to it now. Don't forget to make the most of your ISA - rate might be slightly lower at first sight but nil tax can make all the difference.
> 
> We did the same as you with regard to renting. It helped get us used to knowing what we'd have. *Maybe you loose a years repayments but it can get you a good deal on the house you buy.*
> 
> Good luck. (We did a similar thing and were mortgage free on a 3 bed detached just after turning 30).


I dont understand.....


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## electric_cooper (Feb 28, 2008)

My theory behind renting is that if we take out a mortgage and realise that we cannot afford the living costs then we are tied into the mortgage. If we rent for 12 months then we will have a more accurate idea of the living costs associated with having our own house and are not tied to anything if we feel it is too expensive for us. Will also give us an idea of how much we can reasonably afford on the monthly repayment of a mortgage.

Whilst it may be "throwing money down the drain" for 12 months, I think it will benefit us in the long term and bearing in mind a mortgage is likely to last 25+ years, I dont think renting for 12 months is that bad an idea in the grand scheme of things


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## The Cueball (Feb 8, 2007)

I just went with the bank we were with at the time....

The interest rates are shocking at the moment anyway, so it's not going to make a massive difference in how much interest you get...

It's great idea to rent out for at least 6 months.... not so much for the costs etc...but to actually see if you can live together..

Things get very different when you move in together...some people just don't last... Sorry to talk like that, but it's something to think about very carefully....

:thumb:


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## electric_cooper (Feb 28, 2008)

The Cueball said:


> It's great idea to rent out for at least 6 months.... not so much for the costs etc...but to actually see if you can live together..
> 
> Things get very different when you move in together...some people just don't last... Sorry to talk like that, but it's something to think about very carefully....
> 
> :thumb:


Agree to an extent :thumb:


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## Dixondmn (Oct 12, 2007)

i cant bite my tongue on this one...

I also dont understand the whole "lets see if we can live together thing"

WTF?? - You either love her or you don't. 
If you do, then you work through each others annoying habbits.

I can't stand some of the things my wife does, she's such a messy/accident prone sod but I just have to deal with it because I love her. 
Equally she doesnt see any need to make the bed up like it's about to be photographed for the John Lewis catalogue every morning, but I do!


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## electric_cooper (Feb 28, 2008)

As explained, the main reason we want to rent is to get a more accurate idea of the cost of living away from home and whether we can still have the lifestyle we want alongside it. The living together experience will come with it as a result but is not the reason we want to rent first


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## The Cueball (Feb 8, 2007)

dixon75 said:


> i cant bite my tongue on this one...
> 
> I also dont understand the whole "lets see if we can live together thing"
> 
> ...


Yeah, but I would not call getting gang f***d by the local football team just an annoying habit...

And even if it's not that serious, sometimes it's the little things that grind you down and destroy things...

People fall out of love all the time...not always over a big thing, but something to consider...it's called the "honeymoon" period for a reason...

:thumb:


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## Gruffs (Dec 10, 2007)

TBH mate. 

The best interest rates to be had are by individuals on ISAs. Take one out each and keep it for a deposit. As long as you show the statements to each other, you are saving together but maximising your interest.

We also have 2 joint current accounts. One as the bills account and one as a 'medium term costs' account such as tyres, servicing on the motor(s), holiday (though we have gone without over the last couple of years) etc.

That way, you long term savings should never be penalised by 'unforeseens' and your monthly bills should be covered by the joint current. Whatever is left at the end of the month gets sent to savings (or mortgage overpayments) We will halve the savings/overpayments money to make sure we have a stack of savings but also we reduce the term of our mortgage.


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## APK (Oct 6, 2008)

As Gruffs says ISA's generally offer the best rates and are tax free, I wouldn't worry about expecting preferential service when you get a mortgage just because you have an account there as in general it doesn't exist, although Woolwich/Barclays do offer slightly better deals for current account customers.

Other options are to look at regular savings accounts which quite often have special deals on provided you save a large regular sum, I think Halifax have had one of these with good rates recently.


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## shine247 (Mar 1, 2010)

Does it have to be a joint account. If you want to save monthly you could both open one of the regular savings accounts on offer. For example, first direct offer 8% gross for 1 year and you can save up to £300 per month each. There are other institutions offering similar, fd is just an example. That is better than any ISA just now and if you plan on using the money anyway then the tax advantage of an ISA is not a lot of use. In 12 months just move your money to the best rate you can (that may be an ISA) and do another regular saver if you want. I know this does not fit you plan exactly but you may be able to adapt.

Banks want business anyway and they rarely offer better mortgage rates to existing customers, in fact, often the oposite applies so I would not bother about that much.


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## Kap01 (Aug 12, 2007)

Me and My wife did this:

We pretended we 'had' a mortgage and assoicated bills, opened up a joint account and had to pay those bills 50/50 per month, saved up in no time at all. We managed to do this by living with my parents (short term).

E.g if the total monthly bills were £1k, put £500 each in the account.

Of course some months might not be practical but it allows you to save quickly...

In terms of accounts we used the best rate joint account with our current Bank, i dont think there's much out there in terms of interest,thats worth shouting about. Plus your are likley to use the cash within 24 months.


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## Kap01 (Aug 12, 2007)

The budget calculator on this site is a great tool:

http://www.rightmove.co.uk/resources/property-guides/buying-guide/what-you-can-afford.html

Gives you and idea of costs which you would forget about! Amazing how much you can actually spend on a monthly basis... especially on fuel!


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