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A Mortgage Broker Said To Me


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No pension and a house worth less than you paid for it, not a good combination. Would it not be better to rent and save as much as you can for when the market turns?

quite probably .. have been doing so for for 5 years already.

the real sticking point for me is renting a house more suitable to our needs or at least our wishes (which are pretty modest) is upwards of £1300 per month.

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yep that's what he said....

smaller monthly repayments that way. The idea being that you change mortgage products in 3 years .. by then my partner will hopefully be back working so get a shorter term and have paid back 11k of the capital.

paid back 11K?

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well yes , but the point of the thread was to discuss the advice i received and help me work out where i stand .

Where you stand is that you've reached the age of forty two having made no provision for your retirement and you are now starting to panic. Do you really think that borrowing a load of money to buy a depreciating asset will improve your situation?

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The advice you received from someone trying to sell you something...

I am aware of that.

Does that necessarily make it bad advice though ?

I recently bought a car from a used car sales man, i think his advice as to the car we choose was pretty good. Thats not to say i didnt ask other people before buying that particular model and make.

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quite probably .. have been doing so for for 5 years already.

the real sticking point for me is renting a house more suitable to our needs or at least our wishes (which are pretty modest) is upwards of £1300 per month.

And how much would it cost to 'buy' one of those places? From the sound of it they're outside your budget either way so why trap yourself for the long term in a place that's too small.

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Where you stand is that you've reached the age of forty two having made no provision for your retirement and you are now starting to panic. Do you really think that borrowing a load of money to buy a depreciating asset will improve your situation?

Ha Ha .. I only panic about the pension business when I think about it .

I really am averse to borrowing a load of money . But i do think that owning our own house before retirement is a good idea . I do think that in the immediate future it would improve our living conditions.

As for the timing ? well i dont know .. like you said it might me 50K less next year .. The baby can sleep in with us till then no problem .. but really time is not on my side

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owning a mortgage does not give you security, in fact it gives you the opposite.

Agreed. Personally I *hate* mortgages. But should you be so fortunate to pay off the beast, then you have the bricks. They are then yours. In fact I'd say I can't stand being in debt.

Why would I be more secure owning a house than renting one?

Erm posts ad infinitum on here about security of tenure. I have six years experience of renting places/slums from Rachmann types, and never ever again - for me or my kids.

Why would my kids have a better foothold in life by inheriting a house rather than sufficient cash to buy one?

No disagreement there. You can pass on the goods as you see fit. Money well managed perhaps. I don't know your particular circumstances even though I've read a trillion of your posts.

The idea of investing the £100k and staying forever in rentals is looking a whole lot more attractive than it ever used to.

Well, well done fella. But I think you're an example of someone who seems to be in quite good control of their personal finances and is pretty knowledgeable about various financial markets.

Most family blokes that I mix with via soccer are light years away from that level of ability. I've made an assumption about the OP - I could be well out on that too. ;)

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And how much would it cost to 'buy' one of those places? From the sound of it they're outside your budget either way so why trap yourself for the long term in a place that's too small.

we could 'buy' one of those places and for three years be paying £964 a month plus £70 for minimum required insurances.

after 3 years though i suppose its a gamble, although in our favor hopefully my partner will be able to be earning something too

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I really am averse to borrowing a load of money . But i do think that owning our own house before retirement is a good idea . I do think that in the immediate future it would improve our living conditions.

Only if it's paid for and from your original post it won't be.

Being in negative equity on retirement is not something I'd want.

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i took it to mean the government wouldn't allow it as the consquences would be to catastrophic

And what do the government do to stop this from happening? The only thing I can see that have remaining is QE, and how much longer can that go on?

I think we are approaching a cusp and things are about to happen. I keep harping on about BoE interest rates controlling prices, but I see that mortgage rates are becoming detached and doing their own thing, so the effect will be the same.

The banks lend easy money to drive up prices, then increase rates to rob more money. Then prices collapse and the cycle starts again. Looks to me like we are at the collapsing part of the cycle.

So, as an alternative argument to the above, you should still consider that buying a house now is a gamble. There is the possibility that prices will collapse. We know prices trebled with a 30% increase in wages. The intrinsic value of a 250k property is still only 80k without the land, so in theory prices could drop to building cost, or very nearly. Land doesn't have to be made.

I would hang on a year and see what happens. Rent gives you flexibility, and that has to be worth something. Buying into an over priced asset for 33 years will be a mistake.

Anyway, 33 years would put me off straight away. I'd want to pay this down at 25 years max. I think in France they aim for 15 years. 33 is not realistic.

Edited by LetsGetReadyToTumble
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Only if it's paid for and from your original post it won't be.

Being in negative equity on retirement is not something I'd want.

well i the idea of the 33 year mortgage ( !!) ( i can honestly say i had never heard of such a thing till i spoke to this bloke )

is that as you pay it off you move products to a smaller term.

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  • 439 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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