Reply to this topicStart new topic
> Scary Time In Life. Mortgage.
OrganisedConfusi...
post Jan 14 2008, 03:16 PM
Post #1


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



So I'm 23 and 24 on January 24th and it's about time that I take that dreaded change from rented places to a place of my own. Me and 2 other band mates are looking to buy a house between the 3 of us and get a mortgage on it. Can anybody offer any advice on the whole process and how we can get started with this. I can't wait to have a place of my own. I earn about £24,000 a year which is about $46,000 so what price house can I be looking at realistically?


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
MickeM
post Jan 14 2008, 03:27 PM
Post #2


Born of NWOBHM, Moderation Team Leader
*

Group: Members
Posts: 8.562
Joined: 9-January 07
From: Stockholm, Sweden
Member No.: 1.062



Is it going to be your house, your loan and your money that pay for it while you rent to the others or will everyone chip in on the mortage?
With £75k a year you could go pretty fance if the UK market looks anything like the Swedish. A bit above average a house for sure.
If its you alone I suppse you'd be looking at a £140k house if you don't have any other loans. Someone with knowledge of the UK will know more details than me I'm sure.
Banks and loan institues usualy have a loan-calculator on their homepages. Try one of those and see where you end up.

This will sound like one of your parents but if the three of you are sharing the loan, do you think that's such a good idea in the long run. Moving in with a woman can be a tough deal but imagine three guys disputing who should clean the yellow stains on the porsline and wipe the dirt of of the toilet. Do the dishes, vacuum, who use up all the hot water from long showers and that person should pay more etc etc. unsure.gif

Positive thing there's no complaint about the toilet seat lid, rather - "WHO PUT THE LID DOWN HUH?" wink.gif


--------------------
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 14 2008, 03:32 PM
Post #3


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



QUOTE (MickeM @ Jan 14 2008, 02:27 PM) *
Is it going to be your house, your loan and your money that pay for it while you rent to the others or will everyone chip in on the mortage?
With £75k a year you could go pretty fance if the UK market looks anything like the Swedish. A bit above average a house for sure.
If its you alone I suppse you'd be looking at a £140k house if you don't have any other loans. Someone with knowledge of the UK will know more details than me I'm sure.
Banks and loan institues usualy have a loan-calculator on their homepages. Try one of those and see where you end up.

This will sound like one of your parents but if the three of you are sharing the loan, do you think that's such a good idea in the long run. Moving in with a woman can be a tough deal but imagine three guys disputing who should clean the yellow stains on the porsline and wipe the dirt of of the toilet. Do the dishes, vacuum, who use up all the hot water from long showers and that person should pay more etc etc. unsure.gif

Positive thing there's no complaint about the toilet seat lid, rather - "WHO PUT THE LID DOWN HUH?" wink.gif

We've lived in the same house for the last 2 years so I think we can say we'd be alright after that length of time but we've been renting. I think what we are considering is one of our dad's getting the mortgage on the property and us 3 paying the money to whoever's dad it is each month but our dads say we can do whatever we want with it and we can furniture it ourselves but maybe we put in one of our names and pay money to each other for mortgage. Any advice from others would be incredible as I know its a big change.

QUOTE (OrganisedConfusion @ Jan 14 2008, 02:31 PM) *
We've lived in the same house for the last 2 years so I think we can say we'd be alright after that length of time but we've been renting. I think what we are considering is one of our dad's getting the mortgage on the property and us 3 paying the money to whoever's dad it is each month but our dads say we can do whatever we want with it and we can furniture it ourselves but maybe we put in one of our names and pay money to each other for mortgage. Any advice from others would be incredible as I know its a big change.

Our dad's have better credit histories although none of us have bad credit history either.


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
MickeM
post Jan 14 2008, 03:36 PM
Post #4


Born of NWOBHM, Moderation Team Leader
*

Group: Members
Posts: 8.562
Joined: 9-January 07
From: Stockholm, Sweden
Member No.: 1.062



QUOTE (OrganisedConfusion @ Jan 14 2008, 03:32 PM) *
We've lived in the same house for the last 2 years so I think we can say we'd be alright after that length of time but we've been renting. I think what we are considering is one of our dad's getting the mortgage on the property and us 3 paying the money to whoever's dad it is each month but our dads say we can do whatever we want with it and we can furniture it ourselves but maybe we put in one of our names and pay money to each other for mortgage. Any advice from others would be incredible as I know its a big change.
Our dad's have better credit histories although none of us have bad credit history either.

I think that sounds just like renting. Someones dad will own the house and get the benefits from a larger value the day he decides to sell it.
Same situation if one of you own in unless you state a very clear deal, rather witnessed by a lawyer, that the day you separate and can't work things out you sell the house and split the winnings among you in relation to how much each and everyone have payed in total (for the loan)

Besides all the practical things about loans it sounds like a cool idea to live with ones friends


--------------------
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 14 2008, 03:40 PM
Post #5


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



QUOTE (MickeM @ Jan 14 2008, 02:36 PM) *
I think that sounds just like renting. Someones dad will own the house and get the benefits from a larger value the day he decides to sell it.
Same situation if one of you own in unless you state a very clear deal, rather witnessed by a lawyer, that the day you separate and can't work things out you sell the house and split the winnings among you in relation to how much each and everyone have payed in total (for the loan)

Besides all the practical things about loans it sounds like a cool idea to live with ones friends

By what you say I think the best thing sounds like getting a contract together with a solicitor that all 3 of us have equal share of the house and that if somebody wants to move out we sell the house and have an equal share in it.


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
Chris Evans
post Jan 14 2008, 03:41 PM
Post #6


Learning Tone Guru - Community Coordinator & Moderator
Group Icon

Group: GMC Senior
Posts: 6.319
Joined: 24-September 07
From: Sittingbourne, UK
Member No.: 2.860



Well I have no idea what house prices in nottingham are like mate, if they are anything like they are down here in Kent your gunna need (for something 3 bed wise) in the region of £150,000 upwards.

Even then your £150,000 is only going to get you something small and in a not too desirable area.

unfortunatly your £24K on your own just isnt going to buy you anything, if the others earn the same then basically double it (very approx).

there are some schemes available down here like part buy/part rent, not too adviseable imo but possibly the only way a lot of people are going to be able to find somewhere to live.

The house prices are just mad at the moment, we moved in September and I was scanning the local papers the other day to find that a house on the same development has just sold for £20,000 more than what we paid for ours, I dont see how an increase liek his in four months is justified, I feel sorry for anyone trying to get on the property ladder at the moment here in the UK.


--------------------
Show us what part of the world you live in and get yourself
ON THE GMC:er Location MAP
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 14 2008, 03:44 PM
Post #7


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



It's about 40,000 less per house in Nottingham compared. You can get a modern property for between 150,000 and 200,000. Bad areas and houses are in the 70,000 to 110,000 bracket I'd say here after looking at many houses.


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
Chris Evans
post Jan 14 2008, 03:49 PM
Post #8


Learning Tone Guru - Community Coordinator & Moderator
Group Icon

Group: GMC Senior
Posts: 6.319
Joined: 24-September 07
From: Sittingbourne, UK
Member No.: 2.860



QUOTE (OrganisedConfusion @ Jan 14 2008, 02:44 PM) *
It's about 40,000 less per house in Nottingham compared. You can get a modern property for between 150,000 and 200,000. Bad areas and houses are in the 70,000 to 110,000 bracket I'd say here after looking at many houses.


Wow thats a big difference £40,000 , the price you pay for living too close to London I guess?

should be able to get yourselves something fairly sensible then I`d say mate smile.gif


--------------------
Show us what part of the world you live in and get yourself
ON THE GMC:er Location MAP
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 14 2008, 03:52 PM
Post #9


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



There is a property that is brand new a 3 bedroom apartment in an old mill that has been done up for 160,000 and it is incredible. Being near London and being in the current house price era does have at least 30,000-40,000 addition. You couldn't get a brand new 3 bedroom apartment in Kent for 160,000. Or am I wrong?


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
Chris Evans
post Jan 14 2008, 03:53 PM
Post #10


Learning Tone Guru - Community Coordinator & Moderator
Group Icon

Group: GMC Senior
Posts: 6.319
Joined: 24-September 07
From: Sittingbourne, UK
Member No.: 2.860



yea your right mate, £200K plus, depends on the area ofc, but in general around that sort of price.


--------------------
Show us what part of the world you live in and get yourself
ON THE GMC:er Location MAP
Go to the top of the page
 
+Quote Post
JasoninOhio
post Jan 14 2008, 05:01 PM
Post #11


GMC:er
*

Group: Members
Posts: 37
Joined: 4-January 08
From: Middletown, Ohio, USA
Member No.: 3.710



No contract...no deal. This is a prime situation for serious problems without a contract between you and the others. No matter how much you think you know someone, you don't really know them until you live with them...hence the reason Pamela Anderson can't stay with one husband more than about 3 days...sorry, I had to say it.


--------------------
My gear includes:
An acoustic Alvarez RD20CU
An electric Ibanez GR10
An electric Yamaha-on loan to my younger brother
Another electric Ibanez-I don't play it much
And an electric Kramer-in pieces awaiting another paint job (this is year 7 I believe)
Peavey Renown 212

And some various pedals as well as a BOSS BR1600 studio.
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 14 2008, 06:54 PM
Post #12


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



QUOTE (JasoninOhio @ Jan 14 2008, 04:01 PM) *
No contract...no deal. This is a prime situation for serious problems without a contract between you and the others. No matter how much you think you know someone, you don't really know them until you live with them...hence the reason Pamela Anderson can't stay with one husband more than about 3 days...sorry, I had to say it.

As I said we've known each other for 7 years and lived together for 2 years already so we know it'll be fine living together but we still need a contract sorted and it will be sorted biggrin.gif


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post
Saoirse O'Shea
post Jan 15 2008, 11:52 AM
Post #13


Moderator - low level high stakes
Group Icon

Group: GMC Senior
Posts: 6.173
Joined: 27-June 07
From: Espania - Cadiz province
Member No.: 2.194



Just from my experience and understanding - so Check it with an expert mate as I'm not smile.gif :

Most lenders advise that a mortgage should be less than 3.5 x single income, or 2.5 x multiple income. However most lenders seem over the last few years to have been happy to lend on much higher multiples.

As Smells says it is possible to get a form of shared ownership - for instance where a housing company owns 1/2 the property and you take a mortgage on the other 1/2 and pay rent for the 1/2 you don't own. This can be a very good way to buy a home.

The interest rate you pay is often related to the ratio of your equity to the mortgage - ie the more you borrow as a % of the purchase price the more you will likely pay as the interest rate. So if you can make a sizable deposit it can help a lot. Also - interest rates can vary from lender to lender - so it can be worth checking around. Smaller Building Societies often, in my experience, offer a better interest rate. Also, some do a 'preferential' rate if you have a savings account/shares.

Interest rate is also often related to you as a 'credit risk'. There are some companies that will lend to those with little previous credit rating or some other 'issue' but they tend to charge premium interest rates.

Your monthly repayment reflects the size of the mortgage, interest rate and the term (how long the mortgage is paid). At your age mate it wouldn't be unusual to have mortgage term of 25 or more years. Most lenders seem to prefer a term period that will conclude before the borrower retires (but not always the case).

There are different types of mortgage available. Two common ones are Repayment Mortgages and Interest Only Endowment Mortgages. With Repayment you pay back both interest on the loan and some of the loan each month. Effectively the amount you owe reduces with each payment -albeit it goes down by a very small amount initially as most of the monthly payment is interest. Interest Only Endowment - which received a lot of bad press in the UK - is where you only pay back the interest. The loan you borrowed is only paid back at the very end - presumably by money you have set aside somehow - so if you borrowed 100000UK over 25 years you still owe 100000 UK at the end of 25 years. Advantage here is the monthly mortgage is lower then the Repayment as you only pay the interest. The big risk - and why it got a lot of bad press - is what happens if you can not pay off the loan. Just me personally - I always went with a Repayment.

Most (all?) lenders will insist on insurance - whilst you may have to have it you do NOT have to have it direct from the Lender. You can often get cheaper insurance if you look around. You may also need to consider additional insurance cover for illness, job loss and such like.

Most (all?) lenders will insist on a minimum of a Lenders Survey on the property. You should though seriously consider getting a full structural survey. The Lender (and surveyor) may not show you the Lender's Report - and it won't tell you much anyway - a structural survey though could save you from a very expensive mistake. New properties may have some type of building certificate/guarantee.

Around Notts - survey may well have to include a coal mines check. Regardless you'll need conveyancing on the property to check all the documentation etc. A qualified conveyancer will almost certainly be cheaper then a solicitor. Could save you several hundred pounds.

Stamp Duty - I think duty is not thresholded at 125,000 UK - so you would pay stamp duty/tax (sorry don't know what the rate is, probably 6-7%) if you buy a property over 124,999. If you're looking at property at this mark then it would be well worth your while getting the price below the the threshold.

Don't know if they do it where you are but quite a few cities are/have been involved in major city regeneration schemes. If you buy in an area that is targeted for improvement your property can really benefit when it happens. May be worth checking with the council.

Buying with your mates can be a great way to start. One thing to think about though is what will happen if one of you wants 'out' in a few years? Will the others buy that guy out and if so how will you do that and account for what has already been paid? Also will you all pay an equal share of the mortgage and all the bills (gas, electricity, council tax, water etc)? Although you're mates you might want some sort of contract drawn up...

If you have a friend who's a builder take them to look at the property to advise on possible work and costs.

Keep a float of cash available to cover the first few months when you move in. You'll probably get hit with lots of utility bills and other costs. Also I find it's well worth buying extra lighbulbs, bath plugs and things like that for when you move in.

Sorry if this all seems daunting - it is a lot to take in but it's worth it in the end smile.gif .

Best of luck.

Cheers,
Tony


--------------------
Get your music professionally mastered by anl AES registered Mastering Engineer. Contact me for Audio Mastering Services and Advice and visit our website www.miromastering.com

Be friends on facebook with us here.

We use professional, mastering grade hardware in our mastering studo. Our hardware includes:
Cranesong Avocet II Monitor Controller, Dangerous Music Liasion Insert Hardware Router, ATC SCM Pro Monitors, Lavry Black DA11, Prism Orpheus ADC/DAC, Gyratec Gyraf XIV Parallel Passive Mastering EQ, Great River MAQ 2NV Mastering EQ, Kush Clariphonic Parallel EQ Shelf, Maselec MLA-2 Mastering Compressor, API 2500 Mastering Compressor, Eventide Eclipse Reverb/Echo.
Go to the top of the page
 
+Quote Post
OrganisedConfusi...
post Jan 15 2008, 03:05 PM
Post #14


GMC:er
*

Group: Members
Posts: 5.635
Joined: 29-November 07
From: Nottingham, UK
Member No.: 3.401



Thanks for the help Tony. Those are some great points to take on board. Fortunately I know a very good builder who is the manager of a building site currently so he would certainly help me out. He built my parents conservatory and shed and they are awesome so he would definitely be able to spot problems.

Got a lot to think about but we mwill get there slowly smile.gif


--------------------
Gear
Guitars:- Caparison Horus Snowcloud, Parker Nitefly M, Parker Nitefly SA, Gibson SG, Parker P10e, 40 Year Old Spanish Acoustic
Amps:- Framus Ruby Riot 2x12" stack
Go to the top of the page
 
+Quote Post

Reply to this topicStart new topic
1 User(s) are reading this topic (1 Guests and 0 Anonymous Users)
0 Members:

 


RSS Lo-Fi Version Time is now: 20th January 2017 - 10:58 AM