Mortgage / Deposit question

I was a first time buyer a couple of years ago and scraped together a 5% deposit. Natwest gave me a 2k interest free overdraft and my boss gave me the rest as I was relocating.

I think the seller has to agree to it but it shouldnt be a problem for them as they are getting the convenience of a first time buyer.

Doubt it - it isn't that big a deal.

It's nothing to do with the estate agent - the contract is between you and the vendor.

Don't do it.

Bad move. What if you discover that you can't really afford it because no-one will lend you enough? That's £1000 down the drain.

Pay later.

Offer 0% and tell them to take it or leave it.

Deposits are a silly idea. In Scotland we don't use them.

At exchange you agree to pay 100% of the agreed price on completion. How much of that figure comes from the lender and how much from your savings is strictly a matter for the purchaser, and the seller need not know.

Most people never do it again.

ISTR using the deposit from lower down in the chain to help with this, somehow? Could I be right? I am pretty sure we got it down to 5% though, and it is all negotiable, there is nothing to stop you saying that a condition of the sale is either no deposit, or more likely, a much more reasonable sum.

LOL. Apart from those caught out during a slump?

Eh? I meant if you do it again you won't be a first time buyer. You can't lose your virginity more than once.

Oh yeh? :-)

In message , - writes

The standard contract states 10% deposit at exchange, which is forfeit if you fail to complete.

However, as many people get 95% mortgages, most sellers will accept 5% at exchange, with the ability to pursue you for the other 5% if you fail to complete.

Personally, i wouldnt consider anything less than a 5% deposit on a house I was selling.

Clearly, some people get 100% mortgages and, in these instances, if they have no money, it is hard to get a deposit, but it is always possible to put it on a few credit cards, overdraft, loan from parents etc., and then repay it when the mortgage monies arrive and you receive the balance back from your solicitor.

If you've got 5%, you should have no problem.

Regds

lying

about to hand over before we get the mortgage through, what do

no - it's between you and the vendor. I take it you're wanting a 100% mortgage if you don't have a suitable deposit to hand.

Rob Graham

Not sure about England but as pointed out already, it's a little different in Scotland mainly because it's based on the "offers over" bidding system which means that you could end up paying 10% (or more) over the asking prices anyway, making a deposit that would have previously covered a certain percentage, useless.

There are lenders (such as Northern Rock) who offer 100% (although NR offer it as 85% mortgage and the rest as an unsecured loan at the same rate) although I daresay their rates may not be the lowest. Bear in mind though that depending on the lender, you will still have to keep some capital at hand to cover legal fees etc (some lenders do offer a package built into the offer that6 covers this).

I've heard it can be just as stressful moving house after the first-time purchase due to having to manage selling your home as well as buying the new one..

That's a red herring. You make an offer you can afford, and it will either be accepted or not. You should previously have had an agreement in principle from a lender, telling you how much they will lend you tops, so you'll know what your bidding ceiling is.

You can offer less than the asking price and still be accepted. It depends on how keen the seller is to sell, on how sellable the property is, and on how realistic the asking price is.