In our 40's - New 350k mortgage?

S

Striker

Guest
Hi

We are in the enviable position I suppose of having less than 60k left on our mortgage with about 500k in equity. The dilemma is age old - 3 kids all getting bigger each day and we live in a standard 3 bed semi. We have found a lovely ready to go 4 bed semi nearby (valued at 850k) which we would like to make an offer on but.... why give up on a very manageable situation (both in our 40's, both working) for a new 350k mortgage? Anybody been there done that? What are the choices and are they worth pursuing?
 
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Re: Age old dilemma?

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Brendan
 
Re: Age old dilemma?

We were in that position two years ago when our mortgage finished and about same age as yourself. Considered going for bigger house and again wondered about sanity of putting burden of big mortgage on us. My feeling is that sometimes we run with the herd when everybody is buying bigger and second, third properties. Sometimes we need to take stock and appreciate what we have. If you are happy where you are stick with it and enjoy a lifestyle that very few first time buyers can ever dream of. Just my take on things for what's its worth.
 
Re: Age old dilemma?

Not in that position yet - but hope to be in a few years when we have a good bit more paid off the mortgage. Already we're starting to wonder about what would be the best thing to do for us. Happy Girl has posted good advice and I agree with it.

But both options have pros and cons I suppose - maybe the best thing is to stand back and think how you would feel with a much larger mortgage to pay off over the remainder of your working life.
 
Hi Striker, I think you can only answer that question yourself - everyone has different priorities - but my own opinion - I feel sometimes you have to move forward. Sure you can have excess amount of money in your pocket or bank when your mortgage is paid - you'll probably end up spending it anyway. If you feel the house you are thinking of has ideally what you are looking for, location etc and that you and your family are going to enjoy it - then go for it! You can't buy happiness but on the same point obviously do all your figures to ensure that you can afford comfortably this new mortgage and allow that goes with a bigger house - bigger utility bills etc. Hope I've been of some help!
 
I would hold off for at least 6 months after the election and not move now ! your in a great position why roll the dice now ? with the spare income cash you can treat your kids to a few family holidays a year (while your still all together) and enjoy yourselves ,life's a journey not a destination ;)
 
Also, just consider the extra costs of getting new Mortgage Protection Insurance, for a bigger mortgage, at an older age.

May not be significant, but depends on your life-style etc.
 
I wouldn't rush into it. Wait till a good bit after the election. House prices are falling, it would be a bad time of your life to be caught with negative equity, especially if circumstances changed and one or both you were unable to work.
 
We are a couple in our late 40's ,we paid off our mortgage 9 years ago.We are remortgaging to get a small loan of 110000 to purchase an investment property.We are going interest only route over 20 years with 2 options,pay off capital with one of our pension lumpsums in 20 years or a more attractive option get one of our 3 children to pay off capital in return for being promised house in our will.Less pressure on us in the mean time and our children should be quite happy then to get on property ladder .
I understand that the capital gains threshold is 495000 euro approx.if parent wishes to transfer property to a son/daughter.Obviously with more than 1 child each child would be entitled to their own threshold.Your present house is worth 500000 so you wont incur much capital gains down the line assuming thresholds increase. If you go ahead and purchase 850000 house you should bear capital gains implications down the line.
Hope this is of help.
 
As haille is doing the new loan will be borrowed against their own home I assume?

If the OP sells up and tries to borrow the balance 350K, will the banks lend out 350K over a manageable term to 40 somethings?

even so...

I would not in your position, be keen on taking a new mortgage to 60/65 when you are now practically clear and theoretically could give up / cut down on work at any time in the near future if desired or required.
 
I have friends in their late 30s who will be mortgage free in 3 years' time. They both want to experience/relish that feeling for a couple of years but they certainly have no intention of moving in the future.

Instead of looking elsewhere, why not start by giving your house a lick of paint inside and out, move the furniture around (!) and maybe get some new plants for the garden?
 
I agree with the extension route. Or consider converting the attic if possible. Alternatively look at the "sheomra" (sp?) option of getting a play room for the kids.

Any these options would possibly be achieved for the cost of the stamp duty alone of moving house.

Personally, if I was in your position (based on the info given), I would be very slow to saddle myself with a 350k mortgage when there are alterative options. (but I am risk averse :) )

This is of course provided that you are otherwise happy in your current house.

I also just noticed that you have not factored in stamp duty or other costs in the transaction.
Current house 500k, new house 850 = 350k difference. Add on stamp duty, solicitors fees, moving fees etc. and it would be more like 450k.

Good luck in your choice, and count your blessings.
 
Thanks to all for your interesting replies. It seems we don't know how good we have it. I should have mentioned that the 850 includes stamp duty, oh and also that we have already extended! I suppose there will always be a property down the road from you that you think completely fits the bill. Thanks again.
 
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