ma/pa looking to buy 2nd home - mortgage advice needed
Discussion
Hi,
My mum and dad want to buy a bungalow to sell, I have good contacts in the estate agency trade in my area who keep my updated on any potential good deals and they feel one bungalow in particular could be good for them.
They both work p/t, my dad had a retired police pension [with pot] and would like to put in around 30k depo on a house 100k - whats the best way for them to do this?
My dad is 59 mum is 53 - I presume this will affect mortgage length.
My mum and dad want to buy a bungalow to sell, I have good contacts in the estate agency trade in my area who keep my updated on any potential good deals and they feel one bungalow in particular could be good for them.
They both work p/t, my dad had a retired police pension [with pot] and would like to put in around 30k depo on a house 100k - whats the best way for them to do this?
My dad is 59 mum is 53 - I presume this will affect mortgage length.
m3sye said:
Would interest only make sense?
Naturally, it will bring down the payments, but most lenders will want a plausible repayment plan and 'sale of the property' won't be acceptable for some lenders.Also, not all will do IO, even at 70% LTV some will want it to be 50%.
It's placeable, the lender just need to be chosen with research.
I strongly advise your parents NOT to buy in the current market.
The current attitude of lenders, paucity of mortgages, inevitable interest rate hikes, huge public sector cuts and general depression should ensure house prices remain stagnant for years. How can they rise in this economy?
I cannot see any rises in the UK property market, except possibly for London which is now so multicultural and a genuine international city that this market is really separate from the rest of the UK.
I would suggest your parents will be able to buy at a better price in three years time. Do they need a capital loss? Seriously? They will not make a profit
The current attitude of lenders, paucity of mortgages, inevitable interest rate hikes, huge public sector cuts and general depression should ensure house prices remain stagnant for years. How can they rise in this economy?
I cannot see any rises in the UK property market, except possibly for London which is now so multicultural and a genuine international city that this market is really separate from the rest of the UK.
I would suggest your parents will be able to buy at a better price in three years time. Do they need a capital loss? Seriously? They will not make a profit
Steffan said:
I strongly advise your parents NOT to buy in the current market.
The current attitude of lenders, paucity of mortgages, inevitable interest rate hikes, huge public sector cuts and general depression should ensure house prices remain stagnant for years. How can they rise in this economy?
I cannot see any rises in the UK property market, except possibly for London which is now so multicultural and a genuine international city that this market is really separate from the rest of the UK.
I would suggest your parents will be able to buy at a better price in three years time. Do they need a capital loss? Seriously? They will not make a profit
It's not a bungalow in Turkey Steffan ...The current attitude of lenders, paucity of mortgages, inevitable interest rate hikes, huge public sector cuts and general depression should ensure house prices remain stagnant for years. How can they rise in this economy?
I cannot see any rises in the UK property market, except possibly for London which is now so multicultural and a genuine international city that this market is really separate from the rest of the UK.
I would suggest your parents will be able to buy at a better price in three years time. Do they need a capital loss? Seriously? They will not make a profit
Broomsticklady said:
It's not a bungalow in Turkey Steffan ...
No that would be another bad investment.If you want to gamble on investment I would buy Canadian Dollars in volume.
You will need a Canadian Bank Account and there are offshore tax considerations (the gain WILL be UK taxable, its not a freebie).
My reasons are simple.
Canada has water in volume America does not.
America leases its water from Canada. This is a MAJOR advantage to Canada.
Canada has massive untapped natural resources including huge oil reserves as yet untapped, Bauxite untapped, Steel untapped, vast quantities of trees to export etc etc. The list is endless. And its NOT overpopulated in any way.
I cannot see how the Canadian Dollar is not a good bet.
BUT INVESTMENTS (GAMBLING) CAN FALLS AS WELL AS RISE. BE WARNED
Now this MIGHT be regarded as off topic so I apologise in advance.
They need to see a specialist broker. The above comments about income multiples are not relevant if this is a development property that they intend to buy, refurbish and then sell for a profit - which is what I infer from your post.
Banks are really not very keen on this type of lending, for obvious reasons. I can't imagine they'll get an LTV of 70%, which is what you've suggested, more like 50% if they're lucky enough to find someone to lend.
Banks are really not very keen on this type of lending, for obvious reasons. I can't imagine they'll get an LTV of 70%, which is what you've suggested, more like 50% if they're lucky enough to find someone to lend.
m3sye said:
Hi,
My mum and dad want to buy a bungalow to sell,
So buying to let out then sell later when the market picks up? Or buying to live in then sell later? Just buying to sell means only estate agents & solicitors make money My mum and dad want to buy a bungalow to sell,
If the first option they can purchase the property on a buy to let basis, income then doesn't really come in to it (though some lenders have a minimum income you have to be earning) the mortgage payments will be funded by the rental income. Let it for a couple of years then when you feel the time is right just sell it. Intest only is the normal way & at 70% LTV buy to let lenders won't have any problems with that at all.
Its not all plain sailing though! What if you cant get tenants or worse you get tenants that trash the place. What if the market doesn't pick up, prices don't rise, what then?
You have to want to do it, if you want to buy then I believe this is a great time to purchase, but be in it for a good few years, 5+ & you'll be ok.
So, before I go into any more detail about mortgage options I'd need to know their intentions with the property, live in then sell or let & sell?
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