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Mortgage deposit

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  • Mortgage deposit

    Hi

    As a property owner I am considering placing my property on the market early 2012.
    (Value circa 120000 / 125000)

    My understanding is that most first time buyers, securing a mortgage would need to find at the very least, a 20% deposit

    I am considering the option of "providing" the required deposit as a loan say for a 2 3 or 4 year term.

    Does anyone have any comments regarding this idea?

    I am particulary interested to know how I would secure the necessary repayment?

    Thanks

    Dave.

  • #2
    Re: Mortgage deposit

    No first time buyers can get 90% loans but at higher rates.
    BRAND NEW HOMES
    Information for UK new home buyers
    New Home Blog The latest news and views

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    • #3
      Re: Mortgage deposit

      Thanks for your reply N.H.E.

      Comment


      • #4
        Re: Mortgage deposit

        And actually at up to 95%. They certainly pay for it. Your idea is extremely intriguing, as you propose to be some kind of rogue mortgage lender/personal loan provider, but id also consider the issues a first time buyer might face when explaining to the mortgage lender where they sourced the deposit. In a way you're offering a back door to getting a personal loan to subsidise a deposit.
        Free Guides For First Time Buyers!

        www.FirstTimeBuyerGuru.com

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        • #5
          Re: Mortgage deposit

          You would be able to lend the deposit to the borrower, secured as a second charge.

          However lenders will talk the payment to you into account when establishing the borrowers mortgage and this would limit their max loan. Also, the vast majority of lenders will not allow a deposit from a vendor (except some new build circumstances)

          That said, mortgages up to 95% are readily available so you shouldnt need to go down this route
          Large mortgages and High Net Worth Mortgages from enness private clients

          Comment


          • #6
            Re: Mortgage deposit

            There's another issue of this idea being a backdoor to a 100% LTV mortgage - not necessarily an ideal way of avoiding negative equity for first time buyers.
            Free Guides For First Time Buyers!

            www.FirstTimeBuyerGuru.com

            Comment


            • #7
              Re: Mortgage deposit

              Lenders have stopped accepting vendor gifted deposits (unless new build) and only allow gifted deposits from family members too. What you are proposing is not something any lender would go for.
              Anthony
              Compare the Mortgage Market
              http://www.comparethemortgagemarket.com

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