Omi Posted August 17, 2006 Report Share Posted August 17, 2006 Property is £115k, valuation came in slightly lower but vendor won't budge. Need to raise £8600 deposit in time for the sale to go through. My credit score precludes me from getting a loan for the deposit, Mum was going to help out but has now decided to back-pedal, and I've already instructed solicitors. We REALLY love the house and can easily afford the mortgage and a loan to cover the deposit. I'm selling my bike for £2800 but this still leaves us with a circa £6k shortfall. Do I go to The Unsecured Credit Company and pay 60% APR and ditch the loan as soon as I'm able? Do I take my dirty credit file to my bank manager and show them we can easily afford a loan and beg? Do I murder Mum for letting us down and use the inheritance to pay the deposit? Do I just walk away from the house we really like, and that we can comfortably afford? Does anyone have a better idea? Cheers, Omi Link to comment Share on other sites More sharing options...
JamesB Posted August 17, 2006 Report Share Posted August 17, 2006 Do I go to The Unsecured Credit Company and pay 60% APR and ditch the loan as soon as I'm able? <font color="blue"> That would be a big no-no for me. You never know what is round the corner and these companies prey on people who have a run of bad luck </font> Do I take my dirty credit file to my bank manager and show them we can easily afford a loan and beg? <font color="blue"> Anything to lose by this?</font> Do I murder Mum for letting us down and use the inheritance to pay the deposit? <font color="blue"> It's an idea, but I would make sure she had a good life insurance policy first </font> Do I just walk away from the house we really like, and that we can comfortably afford? <font color="blue"> maybe - sometimes it's better to live to fight another day. The funny thing about houses you really like is that there are a surprising number of them around </font> Does anyone have a better idea? <font color="blue"> Not really - sorry </font> Link to comment Share on other sites More sharing options...
Bounce Posted August 17, 2006 Report Share Posted August 17, 2006 Do I go to The Unsecured Credit Company and pay 60% APR and ditch the loan as soon as I'm able? . Do I take my dirty credit file to my bank manager and show them we can easily afford a loan and beg? worth a try. Do I murder Mum for letting us down and use the inheritance to pay the deposit? maybe not Do I just walk away from the house we really like, and that we can comfortably afford? i think this one would appeal to me and you never know the vendor may just come round if it means losing the sale. Does anyone have a better idea? None i can think of. Link to comment Share on other sites More sharing options...
ashleyadam Posted August 18, 2006 Report Share Posted August 18, 2006 It seems you maybe need to save some more money there will be other houses you will like. Going to bank manager will be waste of time as he cant get past your credit rating if bad. Sorry not to sure if 1st property but going into agreements paying 60% apr on a loan is not a solution - just a nightmare waiting to pop out! good luck Link to comment Share on other sites More sharing options...
Riz Posted August 18, 2006 Report Share Posted August 18, 2006 Stress is always involved with homebuying, Ive only done it once but looking back on it, it was worth it! Dont borrow on the 60% APR and like others have said, other homes are out there...... its similar to cars, they come and ago, although homes change less often perhaps. You will find a better home, keep your eye out! Best of luck. Riz Link to comment Share on other sites More sharing options...
saab Posted August 18, 2006 Report Share Posted August 18, 2006 Did you use an IFA to organise the mortgage? If so he/she would be the best person to ask. If you think a loan is the best idea could your partner (or mother) take a loan out in her name? - if you are confident you can cover the repayments. Link to comment Share on other sites More sharing options...
R32TIM Posted August 18, 2006 Report Share Posted August 18, 2006 Speak to your mortgage advisor, i'm guessing a 100% mortgage is out of the question because of the valuation.....you should tell the vendor this...otherwise they are going to lose a sale. Good Luck. Link to comment Share on other sites More sharing options...
ashleyadam Posted August 18, 2006 Report Share Posted August 18, 2006 100% mortgage is even worst spend the first 14 - 17 years paying interest and you setup fees will also be higher. Link to comment Share on other sites More sharing options...
rs32 Posted August 18, 2006 Report Share Posted August 18, 2006 [ QUOTE ] Going to bank manager will be waste of time as he cant get past your credit rating if bad. [/ QUOTE ] not necessarily - having extracted myself from various past problems, the banks will listen if you've built up a good history with them - but it does take time. avoid the Unsecured Credit Company - as others have said they prey on situations like this and you can end up in a vicious circle if things don't work out for some reason. best of luck Link to comment Share on other sites More sharing options...
R32TIM Posted August 18, 2006 Report Share Posted August 18, 2006 mmmmm....house or no house.. spending a few extra pounds on interest over 25 years is not such a bad thing. When finances permit you can change your mortgage for something else. I started with a 100% mortgage because at the time it was the only way we could get on the property ladder. So you can either pay a bit extra or spend 2 years saving and not going out. ..i know which i'd rather do... Link to comment Share on other sites More sharing options...
gizze Posted August 19, 2006 Report Share Posted August 19, 2006 Who are you using for your mortgage?? By the sounds of things you are using a bank/bulding society and not an independant broker? For a start use a broker and get them to find you a company that will lend you 100% of the value or someone who will lend you the 95% and give you cashback, some of the cashback deals are 10% at the moment, if it is 10% back put down 9% deposit instead of 5, get it from your credit card and repay it as soon as the cashack arrives, you will be tied into the deal for 5-10 years with cashback, but after 5 years just swap deals, at least you are on the propery ladder. Totally disagree that 100% mortgage is wrong, all you do is remortgage in 3 years or when ever you deal is up, and if you were going to take a loan for £8500 over say 3 or 5 years just change your mortgage term from 25-30 years down to 20-25 years instead, will cost less than the mortgage and loan and you can pay more in 3 years or so and reduce it again or move to a bigger house. Do what you have to do to get in there, 7 years ago I didn't go for a house costing £120k for similar reasons, 18 months later it came back on the market and we had to pay £179k for it, if only I had used a broker back then I would now have 3 properties, but I didn't and still kick myself about it. Link to comment Share on other sites More sharing options...
lottiefox Posted August 19, 2006 Report Share Posted August 19, 2006 Don't pay more than the house has been valued at - vendor is being unrealistic in not budging. Try and secure 100% mortgage and work on the valuation figure if possible, if that vendor won't budge find another property. Don't have an unsecured loan at stupid interest rates, its madness as as James says, no one knows what is round the corner. Saving is dull and very hard work. But I rented for 2.5 years and saved my deposit for my first house some years ago. Bought at 92K, sold it 2 years on at £130K, bought at £186K, house just valued at £225ish one year on. Weigh up the pros of buying right now against the financial risks and implications. It might be better to wait a bit? But then I'm pretty risk averse - in reality I should drive a Rover. Link to comment Share on other sites More sharing options...
Rustynuts Posted August 19, 2006 Report Share Posted August 19, 2006 Some sound advice here Omi, but I'm afraid I can't offer anything else. All I'll say is, when you get your first house, it's a great feeling. Good luck with this one. Link to comment Share on other sites More sharing options...
gizze Posted August 19, 2006 Report Share Posted August 19, 2006 [ QUOTE ] Saving is dull and very hard work. But I rented for 2.5 years and saved my deposit for my first house some years ago. Bought at 92K, sold it 2 years on at £130K, bought at £186K, house just valued at £225ish one year on. [/ QUOTE ] Ahh, but if you had bought that same house with a 100% mortgage 2.5 years previously I bet it would have been £80k rather than £92k?? And if you had put all that rent money into the property that you paid out you would have clawed back more than the original deposit too?? The fact you can actually find a property for £115k makes me think that you must be in an area that still has rising property prices??? How much are you buying it for and how much has the valuer actually valued it at, and what are the reasons he has said it is not worth full asking price? the one I would be worried about is if he thinks the area is wrong? I have a mate who always buys interest only, he has never paid any capitol off on any of his buys, he just buys them with minimum deposit and as soon as the value goes up a little he moves and moves onto the next property. He always goes self cert as he doen't earn ridiculous money, and he has just bought the latest one for £775k with a £520k deposit. His original deposit was £3k on a £59k house, and that was only 9 years ago. What I am trying to say is too many people worry about saving big deposits etc. or trying to pay off their little £200k mortgage by the time they are 50, he has got the right idea, as soon as he is in a house where he has £1m equity he is going to move to something that costs half as much with no mortgage and £500k in the bank. Not a bad plan, and I bet he does it before he is 35 too. Link to comment Share on other sites More sharing options...
Insurance Jon Posted August 20, 2006 Report Share Posted August 20, 2006 there is about 5-7 difference between survey to price. I would love to help him out but after being burgaled last month i'm skint. the gut deserves a leg up so to speak. personally i would use the valution as leveredge. Link to comment Share on other sites More sharing options...
gizze Posted August 20, 2006 Report Share Posted August 20, 2006 [ QUOTE ] personally i would use the valution as leveredge. [/ QUOTE ] I think that is the key Jon. You have to remember that the seller is probably more worried about loosing the sale than you are worried about loosing the property, say that you need the asking price to be lowered a tad to keep you interstested. Link to comment Share on other sites More sharing options...
Riz Posted August 20, 2006 Report Share Posted August 20, 2006 Yes Jon has the right idea.... Basically due to bad paperwork by the company who built my apartment I was slapped with a £2k bill which I didnt account for, fair enough it was my fault but I wasnt given all the figures prior to the exhange of contract, in the end the home builders went 50-50 and knocked me £1k off the price! I was well chuffed but still meant I had to comeup with the 1k extra.... which was saved for my furniture.... ended up having no stuff in my apartment for about 2 months! eeeek. Riz Link to comment Share on other sites More sharing options...
Omi Posted August 20, 2006 Author Report Share Posted August 20, 2006 95% Mortgage on the valuation price of £112k means finding a deposit of £5600... If I get the vendor to drop the price accordingly, sell my bike (£2800) that leaves £2800 to find. Worth thinking about a dodgy loan for the lower amount? Link to comment Share on other sites More sharing options...
Sponge Posted August 22, 2006 Report Share Posted August 22, 2006 [ QUOTE ] Don't pay more than the house has been valued at - vendor is being unrealistic in not budging. [/ QUOTE ] I keep reading it's a buyers' market and that there are more houses for sale than ever. As a result people are being more choosey causing some houses to be on the market for a very long time. Remind them of the above and make another offer. Link to comment Share on other sites More sharing options...
Omi Posted August 22, 2006 Author Report Share Posted August 22, 2006 UPDATE: Vendor has agreed to £112k... This means we have to find £5600 for the deposit. My bike is going for £2.8k, leaving a further £2.8k to find. Welcome Finance have just offered me an unsecured loan of £1500 and Mum seems more positive on helping with the remaining £1300! Looking good then. Except the loan from Welcome is a bit extortionate! £1500 loaned, £75 arrangement fee. - Repayments are £100 over 24 months. Total repayable £2416. At least looking like we can now get the house we wanted though! Link to comment Share on other sites More sharing options...
gizze Posted August 22, 2006 Report Share Posted August 22, 2006 Nice one mate. Then the real costs start, she will want new cutains, carpets, sofa, those branches with no leaves on them that stand in the corner, etc. etc. etc. etc. Link to comment Share on other sites More sharing options...
Teacake Posted August 23, 2006 Report Share Posted August 23, 2006 [ QUOTE ] Except the loan from Welcome is a bit extortionate! £1500 loaned, £75 arrangement fee. - Repayments are £100 over 24 months. Total repayable £2416. [/ QUOTE ] If I've added up correctly, that's about 55.5% APR. Is that right? Link to comment Share on other sites More sharing options...
Ian_C Posted August 23, 2006 Report Share Posted August 23, 2006 [ QUOTE ] Need to raise £8600 deposit in time for the sale to go through. Does anyone have a better idea? [/ QUOTE ] Hard graft is the only way here! Going down the Welcome finance route is insane. Whilst I'm sure you might be able to supply them free Omi, how about I chip in a tenner in exchange for a pair of Orange pay-as-you-go sim cards. My dad needs a fresh sim, for his company mobile will disappear upon retirement, plus I wouldn't mind a back up number myself. Ian Link to comment Share on other sites More sharing options...
rjgreen4 Posted August 25, 2006 Report Share Posted August 25, 2006 I was in a similar situation in June, we had a suposed strong chain, guy across the road buying ours, his daughter buying his and his son in law buying hers. I placed the reservation fee on the property I was wanting to buy, this was a new build with 5% off, stanp duty paid, £7k off the list price (as builders can only contribute 5% towards the mortgage) and carpets. This was all for their year end. Anyway it all fell through three days before completion, the father and daughter couldn't get mortgages. I was due to loose solicitors fees, £1k deposit and had spend £2k on tiles. absolutely livid. Anyway the builder came back sniffing two weeks ago and offered us p/x but no where near the financial incentives, previously around £46k, now £18k. I had to put the difference in but the property is well worth the risk. Apparently builders have to now build upwards (meaning more three story houses) due to planning regulations. The style of house we have bought will never be built again and for the money the house is quite big (2.5k square feet). I don't think you can loose with property, the money you are trying to get your hands on will quickly dissapear into equity as the house price increases over the next six months + any returns you are likely to make on renovating the property. I would cash/balance transfer from credit cards (if you had them) or possibly go to the bank manager and try. If you can't get the money its not the end of the world, there are many other properties out there as others have mentioned. Link to comment Share on other sites More sharing options...
Rustynuts Posted August 25, 2006 Report Share Posted August 25, 2006 Ian, I'll send you (or anyone who wants one) a sim card if you make a contribution to Omi's house fund. Available networks are Vodafone, O2, a few Orange, and a few Virgin. I'll even cover postage (Omi, I owe you a favour from a while back). Just let me know if anyone wants. I'll take it as trust that anyone will pass funds direct to Omi, ok? Let's see if we can raise a few quid, it might not make a house purchase, but it'll buy a housewarming beer or two. Link to comment Share on other sites More sharing options...
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