Getting a mortgage - FTB

[TheFaQQer]

Don't fancy tying my own money up in what may be a depreciating asset for the foreseeable, so a BTL that they then rent off me would be an option.

Depending on their income, they might also be able to claim some kind of housing benefit to rent it from you.

[PAH]

Depending on their income, they might also be able to claim some kind of housing benefit to rent it from you.

I'd have to go into hiding in case the Daily Mail heard about it. I can see their opening paragraph now:

Contractor rents property worth £200k to OAP parents forcing them to claim benefits to keep roof over their heads.

I think at the moment the combined pension income of both my parents puts them outside benefits as they don't qualify for pension credits. Of course that could all change if one was to croak it before the other, which is the most likely scenario.

So are we saying it's a good idea to buy property at the moment?

[NorthWestPerm2Contr]

I'd have to go into hiding in case the Daily Mail heard about it. I can see their opening paragraph now:



I think at the moment the combined pension income of both my parents puts them outside benefits as they don't qualify for pension credits. Of course that could all change if one was to croak it before the other, which is the most likely scenario.

So are we saying it's a good idea to buy property at the moment?

Property Bee says so. A lot of properties been on the market for a long time and had several price drops. Things are really bad if house prices are dropping so badly against such high inflation....

[Old Greg]

I'd have to go into hiding in case the Daily Mail heard about it. I can see their opening paragraph now:

So you'd buy the house through your Ltd?

[amorts]

Couldn't help noticing this thread.

I was in a very similar position towards the end of last year. I was a FTB who was renting and looking to purchase a house with only a 10% deposit. Although I had been contracting for 2 years it wasn't a neccessity to have 2 years worth of accounts.

10% deposit does restrict your options quite a lot, and you won't have a chance at getting an offset at that LTV.

However, I went through Contractor Financials who were able to check with the underwriters at Northern Rock (Virgin Money) to get a feel for the affordability and eligibility. Thankfully none of this was a issue so I submitted a full application.

Contractor Financials did require a wealth of information, all previous business bank statements, contracts etc. etc. so be prepared for this.

In the end however, I found the entire process very efficient and moved in just before xmas last year.

My strategy was to bite the bullet with the higher rate in order to get onto the ladder. The mortgage deal allows me to overpay by up to 10% of the outstanding balance with each year with no penalties. As my deal is fixed for 2 years I plan to overpay each month in an attempt to build up enough equity to swap onto a better rate and an offset after this point.

Let me know if you would like any more info.

[northernladuk]

So are we saying it's a good idea to buy property at the moment?

Of course it is!! There are more than enough people needing to sell desperately so will take discounts that will more than cover any further decline in the price. Mortgages are cheap and not going to go up just yet. Rents going through the roof.

We have hit the bottom.. Fill your boots!!!!

[xing]

However it's rarely to see a good property on sell because of lowest interest rate and government subsidy.

Of course it is!! There are more than enough people needing to sell desperately so will take discounts that will more than cover any further decline in the price. Mortgages are cheap and not going to go up just yet. Rents going through the roof.

We have hit the bottom.. Fill your boots!!!!

[northernladuk]

However it's rarely to see a good property on sell because of lowest interest rate and government subsidy.

Eh??? Google translate please.

[PAH]

So you'd buy the house through your Ltd?

Normally I'd say no as you are then liable for CGT when it is sold.

However in times of depreciating property maybe it would be a smart move as you could offset any losses against tax, alongside the usual mortgage interest and maintenance/insurance expenses.

[oversteer]

ContractorMoney were very efficient on the phone and you will basically be limited only by your deposit in terms of the house value you want. Only thing is with a 10% deposit I could only get a rate at about 6%. 15% led to 4.5% and 20% lead to 3.99% so if you can wait and save, it's probably worth doing so.