Buying house.

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Discussion

gaz1234

Original Poster:

5,233 posts

218 months

Friday 18th April 2014
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So I have my own place, my gf has her own. I have equity in it, she doesn't.
She is going to move into mine. I said I would set up an agreement should it fall apart. Good idea?
Also if all goes yo plan I expect us to buy a place together.
Would you still retain equity when purchasing?
Would you also max out using both salaries knowing a child may be on cards in next 2 years?

Thanks!

Ian Geary

4,462 posts

191 months

Friday 18th April 2014
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Evening,

my 2 pence worth:

gaz1234 said:
So I have my own place, my gf has her own. I have equity in it, she doesn't.
I assume she's renting then? Or on an interest only mortgage?

gaz1234 said:
She is going to move into mine. I said I would set up an agreement should it fall apart. Good idea?
I've not had personal experience of this, but I think the vast majority of the country get on OK with the usual steps of being jointly named, or agreeing that the ratio of money put into a house is reflected if the house is sold. The solicitor involved in the house purchase should be able to instruct on the options available.

gaz1234 said:
Also if all goes to plan I expect us to buy a place together. Would you still retain equity when purchasing?
I don't quite follow this question - your equity in a house is the difference between its value, and the debt you owe secured against it (i.e. mortgage). So any deposit you pay would be equity, and you'd gradually build equity as you repay your mortgage. Typically, you use the equity from your existing house to be the bulk of the deposit for the new house, so you'd definitely retain equity from your current house.

gaz1234 said:
Would you also max out using both salaries knowing a child may be on cards in next 2 years?
Tricky one...I would say it's better to avoid moving again to somewhere bigger in less than 24 months, as you'll lose a lot in mortgage surrender fees, legal fees and stamp duty. A family can live in a 2 bed easily enough, although this depends if you have guests round much?

The garden will become more important as your kids get older as well, as will an extra room indoors for the kid to play somewhere, but that will be some years off yet. It all depends how much you value space and location, vs car, holidays, meals out etc.

But, I wouldn't recommend maxing out, as maternity pay (assuming your partner will get it) isn't a lot, and childcare is a lot if you both intend to go back to work.

Still, it sounds like all that is way off, so I'd follow all the usual advice about your fixed spend, variable spend and seeing if you are able to get a house you like, and still put some money aside for dealing with a future child.

gaz1234 said:
Thanks!
You're welcome

Ian

gaz1234

Original Poster:

5,233 posts

218 months

Sunday 20th April 2014
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Ian Geary said:
You're welcome

Ian
Hi Ian, thanks for reply.


gaz1234

Original Poster:

5,233 posts

218 months

Sunday 20th April 2014
quotequote all
She has interest only.
I have equity..

LooneyTunes

6,781 posts

157 months

Monday 21st April 2014
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gaz1234 said:
She has interest only.
I have equity..
Any thoughts of preserving "yours" vs "hers" are largely academic if you think kids are on the way.

Moving house is expensive. The amount of odd jobs that need doing, and extra furniture, always seems to cost a significant sum.

I'd buy the best place you can afford whilst making sure you can weather the financial storm associated with kids (especially if she'll want to go to town on nursery furniture, pushchairs, bigger family car, etc (you won't believe how much some of that stuff costs and how quickly it all adds up)).