We are both single and no one on the horizon, but we both want to get on the property ladder. Neither of us earns enough to get a mortgage on our own but think we could do it if we got one together. I've heard about a new sort of mortgage that's for friends buying together, where after a couple of years you review it and if it's not going well/one of you wants to move out you can sell up or whatever.
Before looking we are going to sit down and work out contingency plans for if anything goes wrong like being fed up of living together, or one or both of us meeting someone and wanting to move out or move them in. Plan would be to get all that drawn up by a solicitor so if it goes wrong neither of us should lose out.
Any one know anything about this or have any advice, or know how mortgages work and can explain it? I earn £13600 and my mate earns about £14k. Where we live is still quite cheap...average house price the the area is 102k! Lots are around 70-85k
2006-07-29 20:50:47 · 13 answers · asked by Anonymous in Business & Finance ➔ Renting & Real Estate
Will probably live there til we end up settling down and moving out. We are both 24 at the moment
2006-07-29 20:54:07 · update #1
May not seem like the ideal option but if I don't buy a house soon I will be living with my dad for the rest of my adult life!!!! House prices over here (UK) are going to keep going up and up....A neighbour bought their house for around 50k in 2000, another neighbour's house was put up for sale last year at 110k. And it's worse in other bits of the country.
I don't want to rent because I can't save as much while I'm renting (compared to while I'm still living at home), and I'll have nothing to show for my money. Plus I really wanna move out!
2006-07-29 21:00:19 · update #2
Buy its the only way for you to get on the first rung of the property ladder.
If your friendship is strong you will both profit by this move.
Banks normally lend money geared to earnings.
For example you may be offered 3 times the joint income of you and your friend.
Shop around some companies/banks are a lot more accommodating.
Good luck with the house and i hope your friendship holds and you make loads of money
2006-07-29 21:14:08 · answer #1 · answered by Anonymous · 1⤊ 0⤋
DON'T DO IT!!!!!!
I did the same thing with one of my friends and it just puts so much stress on your relationship. It all goes t!ts up in the end.
Take the time and look around at all of your different options.
1. Shared ownership schemes where a housing company such as Nomad, Cheviot Housing or North British Housing will actually buy half of a house with you and then you simply pay them rent on the other half.
For example I earn a similar amount to you and I took a mortgage of 50k. Then I approached a housing company and proposed a property to them. The property cost 80k. I bought half and they bought half and I had 10k to furnish and decorate. And I now pay just over 100 pound in rent to the housing agency as well as my £350 month mortgage.
At any point in the future I can offer to buy another 10, 20, 30 40, 50% of the house of them. When I come to sell the house I will get the % of the profit that I currently own. So if the house sells for 100k I will currently get 50% of the profit as I own 50% of the house.
2. You may also want to consider rent to buy. It sounds strange but the way it works is you again contact a housing agency and find a property that they own. You rent it (I know you didn't want to rent but read on) and then after 2 or 3 years you can put in an offer to buy the property but the money that you have already paid in rent goes towards the price. It appears that you get the property at a discounted rate but its just that you already started paying for it 2 or 3 years ago!
3. Another option is that you could simply win the lottery and not have to worry about this sort of sh!t anyway.
We all live in hope!!!
good luck
2006-07-30 08:46:30 · answer #2 · answered by 2160 2 · 0⤊ 0⤋
Of course you can afford it. They do a "Don't have to prove your income" , mortgage, but they don't like telling people about that one. It doesn't matter what your income is as long as you can afford the payments. Work out how much money you have left over every month and that will be how much you can afford to pay. Talk to a financial advisor. I have a massive 5 bedroom house, but if you worked out my income and times it by 3, there is no way I could have got a mortgage, but I can afford the payments. Good Luck.
2006-07-30 04:16:56 · answer #3 · answered by pampurredpuss 5 · 0⤊ 0⤋
I don't have any professional advice, but personally I'd say go for it! Especially since you've thought of all the unpleasant/unplanned things that could happen and are smart enough to realize they can! So many people jump into these things and don't WANT to think about the different things that COULD happen because it isn't nice to think about at the time. You're prepared!
2006-07-30 03:54:36 · answer #4 · answered by Anonymous · 0⤊ 0⤋
You obviously aren't in America, but let me tell you a story that happened, and it happens all the time. Back in '90, I lost my job in California, and had to move to Washington state, where I had a job lined up. I sold my house for $169 G, and with my equity, had about 30G in my pocket after I paid ALL my bills, and closing costs and everything. Two young girls bought it from me. In the contract was included that they had to allow my cat, Minky, to live there till she dies. They agreed, and they fell in love with her. Minky lived to age 16, which is ok for a cat. So I lost contact after that for many years. Then, in 2004, I moved back to California and one day decided to check out the old house. They had sold it in 2003 for $479 G. They had both married, and had rented it for awhile, then put it up for sale. Damn, I wish I would have hung on to that house. Stupid me!!! My point is, GO FOR IT. Just lay down your ground rules with each other, and live in it like it was a family situation, even though you aren't related. Good Luck. Ron
2006-07-30 04:02:36 · answer #5 · answered by Anonymous · 0⤊ 0⤋
DONT DO IT!!!you never know what could happen!!! you dont know if yall will always be friends!!! not a good idea at all!!! you will still be stuck in a contract and if yall get in a fight you may end up paying for something you dont live in! accident waiting to happen!!
2006-07-30 03:53:05 · answer #6 · answered by Anonymous · 0⤊ 1⤋
Yes make there is no pitfalls check carefully with your solicitors
2006-07-30 03:59:53 · answer #7 · answered by Anonymous · 0⤊ 0⤋
ho9w long are you guys going to stay on that house??? until your old?? or get married and then still living with your friend??
2006-07-30 03:52:26 · answer #8 · answered by Ryan 3 · 0⤊ 0⤋
go ahead and buy
2006-07-30 03:53:12 · answer #9 · answered by scream55 2 · 0⤊ 0⤋
i think its sounds ok i guess
2006-07-30 03:54:05 · answer #10 · answered by prestonqueen 1 · 0⤊ 0⤋