Debt question

[ChrisFilter]

you're probably right. if it works for you and i hope it does but as i said before, i am extraordinarily debt-averse and the idea of 25k unsecured debt and a mortgage fills me with utter horror, i'm afraid.

Fair play to you, I wish I'd been debt averse in my youth, unfortunately I fell pray to all the 'Free money?! Wow!' trappings of student life and it was never really drummed into me that debt is a bad thing. That said, it's not always a bad thing, but you know what I mean.

The debt is there and it's not going anywhere without it being paid off, so why worry about it? We have a decent joint income so it's no big deal really.

 

[ChrisFilter]

owning your own gaff is way cool.

you moved yet Chris?

Nope, freeholder still hasn't supplied the leaseholder info - 3 weeks late and counting. Really fucking annoying, 'cos everything else was in place and ready to go for an end-of-March move.

 

[Orang Utan]

There are a million reasons why I'd rather own my home. There was a thread on it a couple of months ago.

If nothing else, wouldn't you like the money you pay for housing to be (in part) going back into your pocket rather than your landlords?

No, I don't want the millstone round my neck and I don't have to pay for boilers to be fixed and furniture to be replaced etc etc

 

[dolly's gal]

Nope, freeholder still hasn't supplied the leaseholder info - 3 weeks late and counting. Really fucking annoying, 'cos everything else was in place and ready to go for an end-of-March move.

gah. ours took six months from the day the offer was accepted to completion. i feel your pain

 

[dolly's gal]

No, I don't want the millstone round my neck and I don't have to pay for boilers to be fixed and furniture to be replaced etc etc

well, you do. do you think landlords don't factor these costs into what they ask you to pay in rent?

 

[Orang Utan]

well, you do. do you think landlords don't factor these costs into what they ask you to pay in rent?

Yes - that's why rent is generally more than a mortgage - I think it's a bargain though - more peace of mind

 

[dolly's gal]

Yes - that's why rent is generally more than a mortgage - I think it's a bargain though - more peace of mind

fair didleys. one of the reasons i like owning a house is cos it means i have made an investment in my future. there will come times when i won't be able to work, by which time i plan to have paid off any mortgage i might have, thus i will not have to shell out for my housing

 

[Orang Utan]

That's my only concern actually - where to live when I'm old

 

[Fuzzy]

That's my only concern actually - where to live when I'm old

dont get old. sorted.

 

[ChrisFilter]

That's my only concern actually - where to live when I'm old

Pretty massive concern though, innit? You're 70, you're retired, you're living off your pension (you do have a pension if you're planning on renting forever, right?) - what do you do?

 

[ChrisFilter]

gah. ours took six months from the day the offer was accepted to completion. i feel your pain

Ouch - 2 months so far for us, but any more than 3 weeks and I'm going to go apeshit. I'm already becoming the agents and solicitors worst nightmare

 

[Looby]

Pretty massive concern though, innit? You're 70, you're retired, you're living off your pension (you do have a pension if you're planning on renting forever, right?) - what do you do?

If you don't own a property they can't force you to sell it to pay for residential care when you're old.

 

[beesonthewhatnow]

If you don't own a property they can't force you to sell it to pay for residential care when you're old.

This is where having a good accountant/financial advisor comes in

 

[Orang Utan]

Pretty massive concern though, innit? You're 70, you're retired, you're living off your pension (you do have a pension if you're planning on renting forever, right?) - what do you do?

Live on friends' charity

 

[EastEnder]

Live on friends' charity

When you're old and pathetic and an embarrassment to society (even more so than now), you can come and live with me. I'll let you stay in the shed, if I've got one by then, otherwise it'll have to the cupboard under the stairs. But if you start smelling of wee or dibbling like a loon, I'll have to leave you chained up in the back garden.

Can't say fairer than that.

 

[Orang Utan]

I'll just be a traveller with a chest with many costumes in it

 

[Jazzz]

I don't really understand why it's such an important goal to own a property.
I'm not bothered about renting forever.

How much have you spent in rent so far, if I may ask?

 

[Orang Utan]

How much have you spent in rent so far, if I may ask?

I don't have a clue - that would mean doing sums

 

[ChrisFilter]

14 years renting at an average of say, £380 a month would be £63,840.

 

[Orang Utan]

money well spent

 

[baldrick]

Yeah, i don't get why people say that rent is wasted money. It isn't at all.

 

[youbeauty]

14 years renting at an average of say, £380 a month would be £63,840.

But you'd only get a mortgage of about £60,000 if you had repayments of £380 a month - what use is that?

It makes more sense as a couple - our rent was £800 a month, our mortgage (£135,000 initially) is £820 a month - but you have to take a pretty long term view to make the sums work as you pay off so little of your capital in the first few years.

 

[lunatrick]

I'm not going to get into the rent v owning your own home - I've done both and they have pro's and con's - currently rent a really nice place that I couldn't afford to buy.....but thats down to the strange conditions of the market in Oz...

anyway back to the original question mr Filter....

Imo the whole crux of this argument is the word 'unsecured'

why secure this debt? that puts your house at risk if you couldn't pay....

scenario :-

The economy goes tits up, interest rates rise, one of you loses your job (you get the picture).........you have two payments make

1. your mortgage without 25K added - this is number one priority to keep the roof over your head

2. 25k unsecured loan - this will take a back seat to the one above. Bad credit rating if you don't pay - yes - but no reposession...

personally I would shop around for the best unsecured rate on a loan for this amount..

 

[zenie]

I'll just be a traveller with a chest with many costumes in it

I can see you doing that!

 

[ChrisFilter]

I'm not going to get into the rent v owning your own home - I've done both and they have pro's and con's - currently rent a really nice place that I couldn't afford to buy.....but thats down to the strange conditions of the market in Oz...

anyway back to the original question mr Filter....

Imo the whole crux of this argument is the word 'unsecured'

why secure this debt? that puts your house at risk if you couldn't pay....

scenario :-

The economy goes tits up, interest rates rise, one of you loses your job (you get the picture).........you have two payments make

1. your mortgage without 25K added - this is number one priority to keep the roof over your head

2. 25k unsecured loan - this will take a back seat to the one above. Bad credit rating if you don't pay - yes - but no reposession...

personally I would shop around for the best unsecured rate on a loan for this amount..

Cheers dude, this is what I was thinking, but wasn't sure - nice one

 

[ChrisFilter]

But you'd only get a mortgage of about £60,000 if you had repayments of £380 a month - what use is that?

It wasn't a direct comparison!

It makes more sense as a couple - our rent was £800 a month, our mortgage (£135,000 initially) is £820 a month - but you have to take a pretty long term view to make the sums work as you pay off so little of your capital in the first few years.

Yeah, I could never have even thought about buying a place with Mrs Chris.

I wasn't suggesting renting is a bad thing, I was simply defending my decision to take on a mortgage.

 

[ChrisFilter]

Yeah, i don't get why people say that rent is wasted money. It isn't at all.

Of course not, but for me it'd be nice to sit back in 25 years and say "aaaah, no rent, no mortgage, no payments!"

 

[lunatrick]

Cheers dude, this is what I was thinking, but wasn't sure - nice one

no worries - just seems silly to 'secure' even more debt if you don't have to......whatever happens you'll find the money hopefully for the mortgage - the rest of it - tough shit for them being so lenient with their credit....

 

[ChrisFilter]

no worries - just seems silly to 'secure' even more debt if you don't have to......whatever happens you'll find the money hopefully for the mortgage - the rest of it - tough shit for them being so lenient with their credit....

Indeed

 

[lunatrick]

Indeed

and lets face it - once you have the mortgage thats your major credit checking hurdles over with anyway.....you build up equity and then any questions gradually subside as you get into a position to put larger amounts down for future loans.......