first time buyer looking for advice (uk)

[mohawkbrah]

so im planning to purchase my first property a 2 bedroom apartment at £100k with a deposit of £10k

that leaves me a mortgage of 90k

my way of thinking is i should get the longest length available to me for the mortgage which is supposedly 35 years in my package offered. it's fixed at 1.8% for 2 years then 4.19% after that, early repayment charges apply if over-payments are made before those first 2 years. and after that two year period a 10% annaul overpayment allowance on remaining debt is allowed this = £9000/year and reducing as total debt goes down

id never see me overpaying that much every year as i earn at the moment £22k before tax but i do have a lower monthly payment with the option to overpay (which i intend on doing) it seems like a  safer option in case i say lose my job, so i can carry on paying the mortgage with my savings until i find a new job without the base mortgage payments crippling me if that makes sense.

Just want to make clear i have no intention of paying mortgage over 35 years but instead overpaying to pay it off quicker and avoid more interest. This just seems like a nice way to avoid a bit of risk in case worse comes to worse


or am i wrong 

[auntie_betty]

Nope, I think you are right.

Build up a good emergency fund (say 6 months expenses) and then 'overpay the mortgage' by offsetting in your mind additional savings in regular savers or high interest paying current accounts (that's probably where your emergency fund belongs as well). After two years you may find that paying a lump sum off (while staying within your 10% limit) would get you a better deal with a lower APR. Otherwise, it doesn't make sense to overpay when you can get higher interest elsewhere.

Or if you have a high attitude to risk, bung in an S&S ISA.

Oh, and don't forget abut your pension!