-
I have been playing with various mortgage calculators online and at the moment, I could comfortably afford a 25, or even a 20 years mortgage deal with the budget I have in mind, so I don't really see any reason as to why would I want to pay unecessary interest for a 30 years deal? Maybe I am missing sth?
ExTra-
Ah, I was mixing you up with bleakreference who was struggling with multiples of salary.
Ignore me, if you can afford it there's no point extending it.
-
Chances are, unless you buy and stay on a tracker or similar that you would be renegotiating your mortgage deal well before the end of your mortgage term. By taking a longer mortgage your repayments each month will be lower and you are right you will pay more interest. However if your deal allows you to overpay you can do that and effectively treat your 35 year mortgage as a 25 year one - the figures would all end up the same. The only difference being that instead of being required to repay (say) £1,500 a month you are required to pay £1,200 and you choose to pay an additional £300 each month. Many deals then let you claw back those overpayments by underpaying in future, allowing you to treat the mortgage like a savings account with a limit on monthly withdrawals.
The main reason you might not be able to take out a longer term is because it might take the end of the mortgage beyond the maximum age they'll lend to.
So, don't worry too much about the term - work out what you can afford to repay, find out what you can be lent (4-5× salary typically - try HSBC for a low number, Halifax perhaps for a higher one) and how much of a deposit you can scrape together.
Then figure out how stable your future might be and see how much leeway you might need on the above figures. If you're working in an unreliable industry where things can change on a whim, you won't get unlimited holidays from mortgage payments. Alternatively you might be on an upwards career path and be earning double what you are now in 10 years, or you might be planning a family or need a heap of cash to redecorate, furnish etc. (can easily be £10-20k if you have lots to do).
Loads to think about and it can get kinda stressful but ultimately it all comes down to you having an extra bill to pay which replaces your rent and a load of juggling to get the interest part of that bill as low as you can. Once you've done it all and got a property and the mortgage, unless you are struggling to make repayments all this calculating and worrying will be a thing of the past and you'll be too worried about paint, furniture, the state of the roof, the jungle of a garden, the local yoot, the lack of a decent local takeaway etc. etc.
Note I am not a mortgage advisor so don't take the above as gospel - I'm sure if I'm way off the mark someone will call me out on it. Don't forget to read up on moneysavingexpert etc.
aggi
rhowe
That's not actually a bad idea if available, and gambling on London prices.
In 3/5 years time the property value goes up, you get a much better deal, you shift down to 20/25 years.
It's a bit crap compared to what you want but it's probably better than renting.