Should I rent? Should I get a mortgage? What should I do?

[Erzengel]

You'd be doing 2 loans then?

One just to get the down payment, and the 2nd one to pay for the remainder of the mortgage?

It's an alright idea, if you knew people who wanted to help you pay the monthlies, but I think it would be financially better if you could do the down payment on your own without loans.

 

[Varient]

I've been saving up for ages. Unbearably being unable to touch most of my money. I've intended to move out with some friends into a house and completed an application form for a lease which I handed in. But two other people want the house, so that might fall through.

It would be my first time having my own place. I'm wondering, if it does fall through, what should be my next step? Renting is all well and good as a temporary means of gaining some freedom and independence, but I wouldn't really be able to save much money. A mortgage would be like a long term investment. But a very costly investment. I'm not even sure if I could afford it. Maybe I could get a mortgage, and have the people I intended to move out with move in and help pay the mortgage.

But if I got a mortgage, I'd be paying it off for like 25 years or something. If I went ahead with it and it turned out to be a mistake, I wouldn't be able to change my mind. Whereas if I were renting, it wouldn't be a big deal to just move back home if I lost my job or whatever.

I could live at home for another year and save like a mother ****er. But to tell you the truth, I'm depressed living at home. My space isn't my own. I can't do what I'd like to do. Kids are always over - my brother and one of my sisters' kids. My two older sisters that live at home dominate the living room and kitchen. So I'm stuck in my room all the time. Being bored ****less, of course, because it's very limited what I can do in my own bedroom. And partly bored ****less because I can't spend my own money on account of saving it all the time. Also, I hate the ****ing area I live in. Place is such a dump and the people here are *******s. I'm 70% sure if I stick around in the Short Strand too long, some drunk fool will stab me thinking I'm an outsider.

I'm not sure what my best option would be. And of course I have no prior experience with this kind of thing.

Seriously?

It Really depends on where you'd like to live.

In California right now you would be a fool to buy because even though it's easy to get in,... there are so many pitfalls and issues with buying your own place that only 25% of californians can afford and keep a home,... the rest fail in some way.

IF I decide to buy a house,.. it will be in the Midwest, If it's cheaper to build, (Atlanta Georgia, Omaha Nebraska, etc,..) I'll have my home built to spec.

Anywhere where I'd like to live that has a messed up housing market,... I'll wait a bit before I even consider it, (In California for example, Costs would have to drop by over twenty percent and realators would have to only expect 2% or less to set me up.


I hope that helped.

 

[Fried Gold]

I'd rent, personally. A decent job should give you more than enough left over from the £300-£400 per month rent, and if not, there's your incentive to get a better one.. I'd also recommend living alone. If you want to live with people, you may as well stay at home.

 

[Wilhelm-Scream]

Hahaha, you saved like mad for a year and you have 1,000....so, just save for another 10 or 20 years.

 

[kainedamo]

Hahaha, you saved like mad for a year and you have 1,000....so, just save for another 10 or 20 years.

lol. That would be funny if that were a full years savings. It's actually about 4 months of HARD saving.

 

[Wilhelm-Scream]

Yeah, I have no idea where I got "a year" from.
All you said was "ages".
Though I know of no circle where 4 months is considered to be ages.

 

[Varient]

lol. That would be funny if that were a full years savings. It's actually about 4 months of HARD saving.

250 a month?

get a better job - if that means school,.. hold off on a house and rent untill you can save 1k a month.

Peace.

 

[kainedamo]

250 a month?

get a better job - if that means school,.. hold off on a house and rent untill you can save 1k a month.

Peace.

If you're talking in dollars speak, technically I earn more than 1k a month.

 

[Erzengel]

Before or after taxes?

You've been working at this job for less than a year. Is this a real occupation or is this just a job til you find something better?

I know you feel the need to leave, but better to be uncomfortable at your parents than miserable living paycheck to paycheck.

 

[Ahura Mazda]

Okay... how about if I do the following... with my bank, I can open a savings account, and be eligable to borrow five times as much as I've saved...


Save per month
£400

In six months I'll have
£2,400

Then I could borrow
£12,000


So if I saved £400 per month for 12 months, I could borrow £24, 000. I could use that money to get a mortgage, and let the place out to other people. So I'd be able to pay back the bank, and the people I'd let to could pay off my mortgage.

How's that sound?

Where will you live?

 

[kainedamo]

Where will you live?

That is the kicker to that plan. I'd have to keep living at home while I pay it off.

 

[November Rain]

stay at home kaine, you're way over your depth, especially without a good regular income...

renting is just a waste of cash

 

[November Rain]

Where will you live?

don't people pay attention to people's 'locations' in their profile anymore...

 

[squeekness]

Save your money. Frankly you haven't saved up enough to do any of what you would like to do. Most of what you have saved up will be eaten up by first and last month's rent plus a deposit and utility hook up charges if you rent. Which means you'll have no safety net should something happen where you really need money like a medical emergency or if you lose your job. And you don't have enough for a down payment on a mortgage.

jag

I agree with jag, you need more money. You don't want to be in that much debt, trust me.

Before or after taxes?

You've been working at this job for less than a year. Is this a real occupation or is this just a job til you find something better?

I know you feel the need to leave, but better to be uncomfortable at your parents than miserable living paycheck to paycheck.

Erz is right too. Suck it up and save as much as you can. You don't want to be in debt up to your eyeballs.

 

[Hole Shot]

Hey, you live in Europe! Little tip, buy a house in the US. The advantage you have over the dollar right now has brought my mom several European clients lately.

 

[Ahura Mazda]

That is the kicker to that plan. I'd have to keep living at home while I pay it off.

It is doable as an investment as long as your rental payments fully cover your interest costs and some of your amortization amounts.

The thing to consider is why you are doing this. Is it an investment or is it for your own pleasure. As an investment you need to look at the market carefully. A mortgage is generally better then rental payments as long as you can make back part of the principle. And you always run the risk of making a nice profit.

 

[redmarvel]

You want to have at least 10% down.

You want to make sure your mortgage payments are under half of what you earn (because you'll have utilities and other expenses on top of that). Also allow for any current loans that need to be repaid. Subtract those from what you earn first, then half of that is the highest mortgage payment you should have.

Are you capable of doing your own repairs or would you have to hire someone els to do them? If you are a good electrician, plumber and carpenter, buy a "fixer upper". If not, stay far away from them, because you could get rooked.

Get a house inspection by a licensed contractor before you buy.

Otherwise, you're usually better off buying then renting. If you're buying you're investing your money in the property and property prices usually increase. If you're renting, that money is gone for good.

Here in Canada you can get an RRSP to help you save and borrow from it for your first home. I highly recommend this method of saving money.

 

[kainedamo]

If I save £400 per month for 2 years, I can put a downpayment on a mortgage.

Of course, that won't leave much money for myself. I could get more hours at work. Or in a couple of months time I could see about getting a promotion. Getting a mortgage at age 25 ain't too bad.

 

[Ahura Mazda]

If I save £400 per month for 2 years, I can put a downpayment on a mortgage.

Of course, that won't leave much money for myself. I could get more hours at work. Or in a couple of months time I could see about getting a promotion. Getting a mortgage at age 25 ain't too bad.

It will only cost you the luxuries that you may be able to forego.

And 25 is young to own a house.

 

[Erzengel]

It's a small downpayment.

In the states, we usually put 10% down.

If your house is £200,000 you should really be putting down £20,000.

£400 every month for 2 years only gives you £9,600.

You either have to set your sites lower as in maybe a smaller house, save longer or get a higher paying job.

 

[kainedamo]

Where the hell did I pull the idea I'd have £20, 000 if I saved £400 every month for 2 years from. My maths sucks.

 

[Erzengel]

What can £200,000 get you in terms of a house?

# of bedrooms, bathrooms, garage etc?

 

[The Dark Guybrush]

squat.

leech off other people's wireless internet for your SHH fix.

 

[black_dust]

What can £200,000 get you in terms of a house?

# of bedrooms, bathrooms, garage etc?

A freaking mansion, you could get 4 bed rooms (maybe some with en suit) and a garage with a hella big garden for 200k

mine was under 125k and its 2 bedrooms with a pretty big garden

Also depends what area you live in with these things, 200k could get you a bed sit in the heart of london

 

[Dangerous]

rent is what I would do. Thats what I am doin next.