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Advice on buying a Repossession
nooneshuffle
Posts: 14 Forumite
Dear Moneysavers,
I am looking for any advice I can get about buying a repossession.
We have a found a flat to buy at 135000, which apparently was sold a few years ago at £240,000, which is a repossession.
I am about to have my first child in November and recently lost my job. I am now self-employed, but have discovered that in HSBC's eyes, I am a dependent of my partner unless I can show 3 years bank statements from being self employed. This has severely dented the amount we thought we could borrow, which is £105,000 based on my partner's salary. We can rustle together £30,000 for a deposit, however, so can afford this flat. We were going to wait until April '10, when we would have a £40,000 deposit but because the amount we can borrow won't change, and from November the amount we can save from me working will decrease to almost zero, we think we should take the plunge now. The mortgage would be the same, or less than the rent we're paying now, albeit with fixed rate mortgages being quite high, we'd essentially just be paying interest to the bank instead of money to our landlord.
The flat is a lower ground flat and has mould in patches in the bathroom, it doesn't look like rising damp as some of it is quite high up the walls and we hope it's due to condensation or a leak in the gutter, but realise because it's LG it might be affected by Rising Damp, although it was built in 1900, so may have a damp course. Would you recommend that we get a builder to have a look at this before plunging for a survey in case we can nip the need to spend hundreds in the bud? What kind of survey should we get, as we need to test the services, as don't want to find out we can't afford a new central heating system with a newborn arriving? Some say homebuyers, others structural, but we don't know the reasons for either. What other problems should be aware of with a repo sale? What could go wrong, could we get burnt? I'm not familiar with repo sales, so any advice would be greatly appreciated. And finally one last cheeky question, in terms of mortgages, given that interest rates look set to stay low for a while, what type of mortgage (variable, fixed etc) would you recommend for a 1st time buyer?
Many, many thanks in advance for any help at all, realise I've asked a ton of qns but pretty nervous as this our first time in all sorts of ways!
I am looking for any advice I can get about buying a repossession.
We have a found a flat to buy at 135000, which apparently was sold a few years ago at £240,000, which is a repossession.
I am about to have my first child in November and recently lost my job. I am now self-employed, but have discovered that in HSBC's eyes, I am a dependent of my partner unless I can show 3 years bank statements from being self employed. This has severely dented the amount we thought we could borrow, which is £105,000 based on my partner's salary. We can rustle together £30,000 for a deposit, however, so can afford this flat. We were going to wait until April '10, when we would have a £40,000 deposit but because the amount we can borrow won't change, and from November the amount we can save from me working will decrease to almost zero, we think we should take the plunge now. The mortgage would be the same, or less than the rent we're paying now, albeit with fixed rate mortgages being quite high, we'd essentially just be paying interest to the bank instead of money to our landlord.
The flat is a lower ground flat and has mould in patches in the bathroom, it doesn't look like rising damp as some of it is quite high up the walls and we hope it's due to condensation or a leak in the gutter, but realise because it's LG it might be affected by Rising Damp, although it was built in 1900, so may have a damp course. Would you recommend that we get a builder to have a look at this before plunging for a survey in case we can nip the need to spend hundreds in the bud? What kind of survey should we get, as we need to test the services, as don't want to find out we can't afford a new central heating system with a newborn arriving? Some say homebuyers, others structural, but we don't know the reasons for either. What other problems should be aware of with a repo sale? What could go wrong, could we get burnt? I'm not familiar with repo sales, so any advice would be greatly appreciated. And finally one last cheeky question, in terms of mortgages, given that interest rates look set to stay low for a while, what type of mortgage (variable, fixed etc) would you recommend for a 1st time buyer?
Many, many thanks in advance for any help at all, realise I've asked a ton of qns but pretty nervous as this our first time in all sorts of ways!
0
Comments
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A survey will not estabish whether heating or other services are working. If a vendor has heating on while surveyor is present, then he may comment that heating appeared in working order when he was present.
Normally with a surveyor it would be usual to turn on taps to at least check there is a water supply, but services are generally cut off from repossessed properties, so nothing for the surveyor to note on these aspects. A surveyor, whether having a homebuyer's or buildings survey would comment on the damp issue.
Without services being connected you can't check whether such things are in working order. It's a chance you have to take with repo's. If you haven't got the money to pay for repairs or a new boiler,should they be needed, then you have to ask your self it buying a repo is really for you.
If the services are connected then a Homesafe registered gas engineer could check the boiler/ch for you. A damp proof company could check the damp issue for you & a qualified electrician could comment on the safety of the electrics & tell you whether they need updating or not. Surveyors usually recommend that you get independent reports on these things anyway as a matter of course.The bigger the bargain, the better I feel.
I should mention that there's only one of me, don't confuse me with others of the same name.0 -
Thank you very much cattie.
So essentially, I may as well get a basic valuation to satisfy mortgage broker if the services have been cut off? And in a worst case scenario in terms of services only, if we did have to install new central heating etc, what are we looking upwards of? 15K, 30K?? I realise it's a how long is a piece of string qn to some extent, but an idea would be great if it's possible.
Thanks in advance.0 -
Yes, just pay for the valuation for mortgage purposes.
Crikey, no the boiler/ch wouldn't cost that much. Probably in the region of £3500 if whole system needs replacing, depending on where you are. Prices are much cheaper up north I understand. Boiler on it's own would be under £2k I would think.
Damp proof courses are not that expensive. It would depend on size of problem, if any & how big the footprint of the house is, but say in the region of £1500. If it's a localised damp problem it could be just a couple of hundred pounds or so to put right. If the damp/mould is just in the bathroom then it's probably just a ventilation problem. Windows need to be open to let steam from baths & showers out if an extraction fan isn't fitted.
When you do buy a house, be it this one or another one, be sure to get 2 or 3 quotes for any work needed. Try to use recommended tradesmen where possible too.
If you're worried about rising interest rates then a fixed rate mortgage might be the best choice. If you can cover any possible rate rises comfortably from your income then you could look at a discounted variable.The bigger the bargain, the better I feel.
I should mention that there's only one of me, don't confuse me with others of the same name.0 -
Hiya, I work for a repossession Asset Manager. Which means basically we're the ones who your offer would come to and we instruct the estate agent and the sols as to what they need to do.
Services will certainly have been drained down, this is due to insurance purposes. And also, only go for the mortgage valuation. Mortgage lenders will not take any notice of anything brought up on a homebuyers report... they are designed to pick the property to pieces, whereas a mortgage val gives a figure based on the properties current condition.DFW #414, MoneySaver, Income Booster
It Always Seems Impossible Until It Is Done.
£2,022 in 2022 #39 - Current total £2.900 -
Thanks very much to both you, it's much appreciated.
Kellsbells, what do you mean the services will have been drained down? Does that have a cost implication? And if the svs are OK, does it cost to get svs turned back on? Is there any way of getting a guarantee that the svs are OK form the bank/agent? Or is it poss to get any iea from the service providers by calling them beforehand?
I realise i'm asking lots of qns and don't want to be a pain, perhaps there's a guide/link to buying repos you can recommend?
Thank you, thank you, thank you0 -
Search on this forum, there's loads of threads which have advice on buying repos.Scar tissue that I wish you saw, sarcastic mister know it all, close your eyes and I'll kiss you cause with the birds I'll share this lonely view.0
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That's really good advice:princessamy86 wrote: »Search on this forum, there's loads of threads which have advice on buying repos.
http://forums.moneysavingexpert.com/showthread.html?p=21448755&highlight=#post21448755
You could start by clicking on my links.Been away for a while.0
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