Mortgages...............
#41
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Had my house a year now, put down 16k and re payments are £1200 a month for 25 years
, remeber thinking at first, what the hell am i doing having £1200 coming out of my account a month for 25 years! i was living at home paying £30 a week
Now though its pritty easy, even managed to save and buy an escort cosworth
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Now though its pritty easy, even managed to save and buy an escort cosworth
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#42
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Originally Posted by JohnnyB
Originally Posted by Mondeo Man
Also good for buy to let in a stable/rising market long term
you seem to have answered correctly
I refer you to this and your sarky comment about inflation...where you clearly dont understand how it affects relative spending power
Originally Posted by JohnnyB
how can you wages go down?
there is a thing called inflation
there is a thing called inflation
Only a mong would buy a house on interest only on the verge of a housing market crash......insatant negative equity...UNLESS you were VERY cash rich and it was a very long term investment.
#43
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Originally Posted by JohnnyB
only ever to interest only
remember the house goes up, but the amount you owe stays the same.
remember the house goes up, but the amount you owe stays the same.
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#44
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lets take it from this point of view.
I have bought a house and I am using a repayment method.
I need to earn more to repay it, but to earn more I get taxed more correct?
so on a interest only one I need to earn less eg less tax, but if I need to use my capital then I have money ready which is not taxable.
look at the long term not the short term
ps there will not be a crash, not this time
I have bought a house and I am using a repayment method.
I need to earn more to repay it, but to earn more I get taxed more correct?
so on a interest only one I need to earn less eg less tax, but if I need to use my capital then I have money ready which is not taxable.
look at the long term not the short term
ps there will not be a crash, not this time
#45
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Originally Posted by JohnnyB
lets take it from this point of view.
I have bought a house and I am using a repayment method.
I need to earn more to repay it, but to earn more I get taxed more correct?
so on a interest only one I need to earn less eg less tax, but if I need to use my capital then I have money ready which is not taxable.
look at the long term not the short term
ps there will not be a crash, not this time
I have bought a house and I am using a repayment method.
I need to earn more to repay it, but to earn more I get taxed more correct?
so on a interest only one I need to earn less eg less tax, but if I need to use my capital then I have money ready which is not taxable.
look at the long term not the short term
ps there will not be a crash, not this time
Great answer above...providing you dont go straight to negative equity...which is a possibility at the moment if you go 95-100% loan/equity on interest only, then you have no capital to play with, which is my whole point.
I agree with you that long term interest only is good as an investment if you read my previous answers.
ps. If you release equity on your purchase that you have made from the price increase you'll be very lucky not to pay capital gains tax
ps. To help you out here I have a Masters Degree in Economics and Accounting, am working as an accountant and am looking/working towards working in the property finance market
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#46
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Originally Posted by Mondeo Man
Originally Posted by JohnnyB
only ever to interest only
remember the house goes up, but the amount you owe stays the same.
remember the house goes up, but the amount you owe stays the same.
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#47
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All very well interest only but when you retire you still have a house to pay for, and unless you move and downsize that aint gonna happen, come 60 I will have paid off my mortgage, assume I dont move up again.... Although I am over paying to ensure its paid off long before then
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Originally Posted by dvid
All very well interest only but when you retire you still have a house to pay for, and unless you move and downsize that aint gonna happen, come 60 I will have paid off my mortgage, assume I dont move up again.... Although I am over paying to ensure its paid off long before then
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AMAZING how much you can save
#49
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you don't just buy one house you have lots of houses and every 2 years just like a crop you havest them.
you may want to but some of the havest into a new purchase or buy outright one of the houses in your portfoilio.
thus so at some point you will have a good few houses you own which are paying for them selfs
can I suggest buying the book from the above link
you may want to but some of the havest into a new purchase or buy outright one of the houses in your portfoilio.
thus so at some point you will have a good few houses you own which are paying for them selfs
can I suggest buying the book from the above link
#50
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mondeo man a question for you if you will please
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
#51
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you pay capitals gains tax on anything other than the house you live in when you come to sell
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
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Originally Posted by gingeRS
new mortgages as a general rule of thumb.....you need £500 a month for each 100k you borrow.
so i'll be looking at a £1200 a month mortgage on the flat i'm looking into buying this summer, £280k (£60k down)
2 bedroom
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so i'll be looking at a £1200 a month mortgage on the flat i'm looking into buying this summer, £280k (£60k down)
2 bedroom
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#53
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Originally Posted by dojj
you pay capitals gains tax on anything other than the house you live in when you come to sell
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
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#54
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Originally Posted by Rudey
mondeo man a question for you if you will please
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
Its up to you what you do, i wouldnt be too eager to buy a second buy to let property in the current climate, but to be honest nowhere is great to invest in at the mo unless you want to take a risk.....
I am in the same predicament, I have paid for my wedding later on next year and have £50 sitting there ready for property.....I have one house already and want to end up living somewhere bigger with a second property too...I think I can do it lol
#55
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Originally Posted by Mondeo Man
Originally Posted by Rudey
mondeo man a question for you if you will please
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
i have 60k gathering interest im not going to buy a house just yet as the market is messy as im not clued up on this sort of thing and you obviously are what would be my best option from below
if i buy itd be around 150k
do i put half of that down and use the rest for the payments and be mortgage free for a few years? and what kind of mortgage would be the best option
or do i buy a 60k house ex council outright rent that out and put towards a mortgage for a 150k house giving me a safety net so to speak if things go pear?
im not after buying 6 houses with 10k deposits to rent out as to me and alot of people i know with property that lick has had its day the mortgages cost to much and youd be struggling to make rent match repayments
johnny quick question when was that book published mate?
thanks in advance
Its up to you what you do, i wouldnt be too eager to buy a second buy to let property in the current climate, but to be honest nowhere is great to invest in at the mo unless you want to take a risk.....
I am in the same predicament, I have paid for my wedding later on next year and have £50 sitting there ready for property.....I have one house already and want to end up living somewhere bigger with a second property too...I think I can do it lol
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#56
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Originally Posted by Rudey
Originally Posted by dojj
you pay capitals gains tax on anything other than the house you live in when you come to sell
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
so buy buying a second house you have already fucked yourself up for the future, even if you sell the cheap house
<edited to add>
you would have to see the house price go up and over the point where your money originally invested was returned AFTER your gains had been discounted
and in this climate, it will be ages before that happens
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he could then sell it on or use the house to buy something elsewhere, away from his dad
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#57
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I own one house. I have no intention of renting it out. I want to live in it.
Why in the hell would I do interest only?!?!?!![Confused](https://passionford.com/forum/images/smilies/icon_confused.gif)
I have a 35yr mortgage, so if I went interest only, then over 35yrs I'd have paid the bank something daft like £200k (probably more if rates rise progressively over the years) but when the mortgage period has finished, I STILL owe them the £160k my house cost, I don't own it, but I am out of pocket by £200k?
Yeah, makes perfect sense![Surprised](https://passionford.com/forum/images/smilies/bigcry.gif)
Interest Only only makes sense if you buy to let. Or you have an endowment policy, but thats now seen as an "old" thing to do (my mothers house they bought for £44k, worth near £400k now, but of course she only has to pay back the £44k borrowed, but cos they bought it back in the late 70's/turn of the 80's, she has an endowment policy rather than a repayment mortgage)
To me, interest only is like renting. You pay roughly the same what it would cost to rent, maybe save a few quid each month, but at the end of it all, you still don't own the house, just have spent a shit load of money to live there and have nothing to show for it.... Just like renting
Why in the hell would I do interest only?!?!?!
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I have a 35yr mortgage, so if I went interest only, then over 35yrs I'd have paid the bank something daft like £200k (probably more if rates rise progressively over the years) but when the mortgage period has finished, I STILL owe them the £160k my house cost, I don't own it, but I am out of pocket by £200k?
Yeah, makes perfect sense
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Interest Only only makes sense if you buy to let. Or you have an endowment policy, but thats now seen as an "old" thing to do (my mothers house they bought for £44k, worth near £400k now, but of course she only has to pay back the £44k borrowed, but cos they bought it back in the late 70's/turn of the 80's, she has an endowment policy rather than a repayment mortgage)
To me, interest only is like renting. You pay roughly the same what it would cost to rent, maybe save a few quid each month, but at the end of it all, you still don't own the house, just have spent a shit load of money to live there and have nothing to show for it.... Just like renting
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#60
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get your head round this
people don't get it
what car could you buy for 20k 35 years ago? aston ?
what car could you buy with 20k now ford focus ?
so you owe 160 would it be the same 160 k in 35 years ?
people don't get it
what car could you buy for 20k 35 years ago? aston ?
what car could you buy with 20k now ford focus ?
so you owe 160 would it be the same 160 k in 35 years ?
#61
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To me, interest only is like renting. You pay roughly the same what it would cost to rent, maybe save a few quid each month, but at the end of it all, you still don't own the house, just have spent a shit load of money to live there and have nothing to show for it.... Just like renting Clin d'oeil
wrong
you owe money, but it will be fook all in 35 years
if you are skint just take a small loan out and then it will be yours
wrong
you owe money, but it will be fook all in 35 years
if you are skint just take a small loan out and then it will be yours
#62
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Originally Posted by JohnnyB
get your head round this
people don't get it
what car could you buy for 20k 35 years ago? aston ?
what car could you buy with 20k now ford focus ?
so you owe 160 would it be the same 160 k in 35 years ?
people don't get it
what car could you buy for 20k 35 years ago? aston ?
what car could you buy with 20k now ford focus ?
so you owe 160 would it be the same 160 k in 35 years ?
My mums house cost £44k in 1979/80. It's worth £400k now. Doesn't mean she owes the bank £400k tho does it? She borrowed £44k, so she owes them £44k (plus the interest or course, which you'd pay anyway if you were doing interest only)
I don't see why you keep quoting what house WILL be worth?
As I said, that works in principal for houses that you buy to let. You buy at £200k, interest only mortgage is say, £500 a month. You rent it out for £750 a month. In 20years it's worth £300k, so you sell it and you are £100k up, plus the "profit" from the rent...
But what does that have to do with buying a house you want to own and live in?
End of the day you will always owe the bank what you borrowed no matter if house prices rise or fall... If prices crash, and my £160k house is only worth £30k, I still owe £160k!
#64
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thrush it will never crash over 30 years
its impossible, so that 44k was a massive amount of money in 1980 now you can get a personal loan for 44k at the end of the day you mum has payed more in income tax to afford to pay back that 44k
its impossible, so that 44k was a massive amount of money in 1980 now you can get a personal loan for 44k at the end of the day you mum has payed more in income tax to afford to pay back that 44k
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i am not giving you guys more info, as you seem to short sighted to see it
but one little thought
44k in 20 years would be the be the spending limit on a normal credit card
work it out
but one little thought
44k in 20 years would be the be the spending limit on a normal credit card
work it out
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Originally Posted by JohnnyB
35k now is not 35k in35 years
get you fookin head round it FFS
get you fookin head round it FFS
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#69
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Just found this mortgage calcultor if anyone wants to try it and see how accurate it is.............
http://www.bbc.co.uk/homes/property/...lculator.shtml
http://www.bbc.co.uk/homes/property/...lculator.shtml
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#70
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Originally Posted by Thrush
You buy at £200k, interest only mortgage is say, £500 a month. You rent it out for £750 a month. In 20years it's worth £300k, so you sell it and you are £100k up, plus the "profit" from the rent...
#71
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jhonny - yes thats true, but SO WHAT!!!!! If you spend 35yrs paying interest only mortgage, at the end of 35yrs you still don't own the house! THIS is what I am getting at. So what if it's worth more or less than it was before YOU STILL DON'T OWN IT.... I want to own my house, so that when I sell it I pocket the profit. But the only two ways to own it is either do a repayment mortgage, or pay interest only for the life of the mortgage, then at the end sell it for more than I paid for it, and pay back the money I borrowed in one lump sum......
Either way, I would still have paid the same ammount of interest, and I would have still paid the total initial sum borrowed, so whats the difference?
Either way, I would still have paid the same ammount of interest, and I would have still paid the total initial sum borrowed, so whats the difference?
#72
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Originally Posted by S3an
Originally Posted by Thrush
You buy at £200k, interest only mortgage is say, £500 a month. You rent it out for £750 a month. In 20years it's worth £300k, so you sell it and you are £100k up, plus the "profit" from the rent...
#73
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I have a good deal, started mine 2 months ago through skipton.Its a repayment mortgage over 35 years for now. Hoping to reduce to 25 when 3 years is up. Its capped at 5.99 currently around 3.5 but wont go bellow 2.99. Paid £9000 in fees and deposit leaving me a mortgage of 85000 on a 3 bed semi with detached garage. Needs a bit of work hence me and pa gutting it. Worth it in end tho.
#75
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Thrush what you don't get is if you repay every month you need to earn enough to pay it, so you pay more tax.
just look at the figures more deeper mate eg what you earn what you repay and work out the tax
if you pay off you after 25 years it works out cheaper just do the maths
this is how i am feeling
Please get the book on the above link
just look at the figures more deeper mate eg what you earn what you repay and work out the tax
if you pay off you after 25 years it works out cheaper just do the maths
this is how i am feeling
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Please get the book on the above link
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i think the problem you can't get your head around matt is the fact that the bank won't own your house
you will still own your house with an intrest only mortgage
but you will still owe the money to the bank
so you need to find that money from somewhere, which is why you need to flog the house to finance the repayments
i don't think jhonny realises this either as he thinks prices will rise as they have in the past 30 years
they won't because inflation has shrunk
my dad bought our current house for £12k in 1978 and got a mortgage that was £68/month for 15 years
at that time it was a large amount of money to be paying and he had to scrimp and save, but as time went on, he was earning more moeny per year so that when he was reaching the end of his mortgage time he was earning £300 a week so that sum of money for the mortgage was paltry
compare that to today's money, where you pay 30 times that amount for a house and you pay that much more for the mortgage
can you imagine joe average earning £9k a week in 25 years time?
exactly and this is the problem that no one realises when the prices boomed
those who had property and invested right at the start can now reap the rewards, but doing it now is only going to give oyu a head ache because you'll always be looking for the mooney to cover the mortgage and you won't really see a huge amount of rise in prices as you did ove the past 10 years
and you've got the added problem of being fucked for tax when you sell up
if you have 4 houses all worth £250k say but you boguht them years ago for £25k each and then sell them, you've made £900k
out of that, you've got to give the government 40% of that money, which is £360k but you are left with £540k which is fine
but buy now for that same £250k per house and then sell in years and years time for £350k and you've made £400k but you've got to put £160k to the tax man which leaves you with £240k, which won't even buy you a house at the current rate
buying at the top end of the market and thinking prices will carry on tising is not clever which is why this past month has seen the most amount of buy to let properties being sold off by landlords in years and years
if lots of people are jumping ship then i think they know what they are doing
it'sthe same as share sharks thiking the northern rock was going to be a big earner in a few weeks, shares went from over a tenner a share to now currently about 87p a share
you will still own your house with an intrest only mortgage
but you will still owe the money to the bank
so you need to find that money from somewhere, which is why you need to flog the house to finance the repayments
i don't think jhonny realises this either as he thinks prices will rise as they have in the past 30 years
they won't because inflation has shrunk
my dad bought our current house for £12k in 1978 and got a mortgage that was £68/month for 15 years
at that time it was a large amount of money to be paying and he had to scrimp and save, but as time went on, he was earning more moeny per year so that when he was reaching the end of his mortgage time he was earning £300 a week so that sum of money for the mortgage was paltry
compare that to today's money, where you pay 30 times that amount for a house and you pay that much more for the mortgage
can you imagine joe average earning £9k a week in 25 years time?
exactly and this is the problem that no one realises when the prices boomed
those who had property and invested right at the start can now reap the rewards, but doing it now is only going to give oyu a head ache because you'll always be looking for the mooney to cover the mortgage and you won't really see a huge amount of rise in prices as you did ove the past 10 years
and you've got the added problem of being fucked for tax when you sell up
if you have 4 houses all worth £250k say but you boguht them years ago for £25k each and then sell them, you've made £900k
out of that, you've got to give the government 40% of that money, which is £360k but you are left with £540k which is fine
but buy now for that same £250k per house and then sell in years and years time for £350k and you've made £400k but you've got to put £160k to the tax man which leaves you with £240k, which won't even buy you a house at the current rate
buying at the top end of the market and thinking prices will carry on tising is not clever which is why this past month has seen the most amount of buy to let properties being sold off by landlords in years and years
if lots of people are jumping ship then i think they know what they are doing
it'sthe same as share sharks thiking the northern rock was going to be a big earner in a few weeks, shares went from over a tenner a share to now currently about 87p a share