First time mortgage

[Drago]

In my day my Mater and Pater drummed it into me not to buy a leasehold unless it had 90 or more years to run, and never at all if I was likely to want to purchase the leasehold in the future.

Do people these days not listen to their folks or their solicitors any more?

That article is frightening. "We didn't know it was leasehold until we went to put the deposit down..." What on Earth are these people doing not asking the most basic, fundamental question before they go to even look at a house or a plot? Its difficult to have sympathy for folk who treat the most expensive transaction of their lives so casually.

 

[keithmac]

Ours is mid 50's build ex council house, lovely big back garden and room for 3 cars on the font drive.

Seen a few new builds that friends have bought, small gardens and flimsy internal walls, not for me..

We have 30 year mortgage, (18 to go!) But the house has almost doubled in value in the last 12 years.

The inside was a shell but 6 months of nights and weekends got it all sorted out, not a shiny showhome but a good solid house.

Can't see the housing market crashing, even if it levels off were in a great position.

Renting is just dead money imho, and the situation where you can't get a mortgage but can pay rent higher than that monthly payment needs to be addressed..

 

[gaijintendo]

Ramble:
The reason I liked renting was I didn't have to worry about the boiler, the roof, painting, my crap DIY, mortgage renewal, even neighbours were less of a concern. Now I Karcher vacuum the shower walls every day to fend the room from mould. I'm a worrier... so that list is a real burden for me believe it or not.
Also, I lived in an area that suited me and I couldn't afford to buy in. Renting wasn't insanely expensive either. Certainly comparable to a mortgage on the same property.
I know we are not expecting a crash, but when I was renting, that was not a concern as getting on the ladder seemed impossible for the most of that time.
Completely changing location wasn't an issue back then.
Having got into the house game, I'm not particularly in love with it. I believe it has inflated and increased in value very modestly, but I'm not rubbing my hands with glee. I need somewhere to stay, and this has worked out for me, that's about all I can say from my privileged position.

 

[oldfatfool]

Umm, bankers don't set interest rates as such. And why do you think low rates are necessarily good for bankers, and by implication bad for the rest of us?

If the base rate is 15% as it was when i got my mortgage then savings rates tended to be around 15% and the mortgage rate around 17.5% a reasonable spread, and a reasonable return on money saved. NOW with a base rate of 0.25% you are lucky as a saver even in an ISA to beat 0.6% whilst the std variable rate mortgage is 4% +? a wider spread AND the banks are basically using savers money for no cost to earn mega wonga. So if you put the base rate in the hands of the bankers it is obvious they are not going to increase rates and have to pay out interest on savings when they can just charge inflated mortgage rates and use money for nothing. If you want to give me a million squid at 0.6 % interest over say 25 years I will gladly guarentee you this rate, meanwhile if anyone wants a mortgage I will do it for 2.5% fixed for 25 years once I have the million squid from Profpointy.

 

[Profpointy]

If the base rate is 15% as it was when i got my mortgage then savings rates tended to be around 15% and the mortgage rate around 17.5% a reasonable spread, and a reasonable return on money saved. NOW with a base rate of 0.25% you are lucky as a saver even in an ISA to beat 0.6% whilst the std variable rate mortgage is 4% +? a wider spread AND the banks are basically using savers money for no cost to earn mega wonga. So if you put the base rate in the hands of the bankers it is obvious they are not going to increase rates and have to pay out interest on savings when they can just charge inflated mortgage rates and use money for nothing. If you want to give me a million squid at 0.6 % interest over say 25 years I will gladly guarentee you this rate, meanwhile if anyone wants a mortgage I will do it for 2.5% fixed for 25 years once I have the million squid from Profpointy.

Well apart from the actual mortgage rate you pay being around 2.75 which looks like the same sort of spread you mentioned in your good old days.

And surely the bank of England setting the base rate ao as to meet inflation targets set by um goverment is a long way from "bankers" setting interest rates to maximise profits. I appreciate both contain the word "bank"
Aren't bank profits dictate by spread rather than absolute value of interest rates regardless

Edit - I should add that I'm not defending the banking system, nor bankers, but simply don't follow the logic in your argument

 

[Beebo]

‘We paid £101,000 for our Taylor Wimpey home in 2010 – now it’s valued at zero’

https://www.theguardian.com/money/2...t-scandal-engulfing-new-home-buyers-leasehold

I watched a programme where the ground rent escalation clause was written in such a way that it doubled every 10 years. By year 100 of the lease they were expected to pay over £1million per year.

 

[oldfatfool]

Well apart from the actual mortgage rate you pay being around 2.75 which looks like the same sort of spread you mentioned in your good old days.

Current svr is around 3.7- 4.7%

 

[Profpointy]

Current svr is around 3.7- 4.7%

'kinell, I suggest doing a bit of shopping round then. I think mine's 2.75% or thereabouts

Edit: got curious and checked the linky. These are discounted inititially but naturely got up later hence a lot more expensive than the normal going rate and probably a poor deal. The banks do tend to be a bit naughty selling this sort of thing. They tried to (mis-)sell us a deal where you paid an up front fee to get a lower rate; the lower rate only lasting for a couple of years. "Hang on a minute that's costing us more money than paying the higher rate and not paying the fee". The bloke tried woefully to justify it. I've got a maths degree and my wife's a f/#/#in accountant. He then tried to say we had to have that product as I'd answered a questiaire saying I'd pay a fee to get a lower rate and he wasn't allowed to sell us something else. To be fair to the lad I think he was flumoxed by the system, but was very sensitive when I mentioned "mis-selling". Just to be clear this was basic arithmetic not partial differential equations so it was a bit of an insult really

 

[biggs682]

From what i can make out a visit to a new build house was done on Saturday and she loved it all nice and shiny and so spacious , so when i said that was because the furniture used in showhomes is of non std size ie small to give that impression i was told not to be silly

 

[Drago]

What do us Dad's know, eh Martin?

 

[keithmac]

From what i can make out a visit to a new build house was done on Saturday and she loved it all nice and shiny and so spacious , so when i said that was because the furniture used in showhomes is of non std size ie small to give that impression i was told not to be silly

Interesting trick!.

 

[Nebulous]

NOW with a base rate of 0.25% you are lucky as a saver even in an ISA to beat 0.6% whilst the std variable rate mortgage is 4% +? a wider spread AND the banks are basically using savers money for no cost to earn mega wonga. .

It depends how much savings you have in cash. Strangely current accounts pay most and with some active shuffling and running multiple accounts you can get a fair bit in monthly savers and current accounts at up to 5%

 

[oldfatfool]

'kinell, I suggest doing a bit of shopping round then. I think mine's 2.75% or thereabouts

Lol my (re) mortgage is actualy quite old and is capped at 1% above base rate. Try getting that deal now that base rate is so low!

 

[oldfatfool]

It depends how much savings you have in cash. Strangely current accounts pay most and with some active shuffling and running multiple accounts you can get a fair bit in monthly savers and current accounts at up to 5%

Tend to be capped at a maximum amount in the account and have a minimum monthly pay in and pay out by dd. Find me one were i can drop £100k in with no risk to capital and have acces and i will buy you a beer. Even my credit union account was down to 0.5% this year from 2% last and that as a capped saving limit.

 

[biggs682]

Interesting trick!.

sure its true in some cases