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    • littletinymouse
    • By littletinymouse 14th Jun 17, 9:36 AM
    • 2Posts
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    littletinymouse
    Concessionary Mortgage Advice
    • #1
    • 14th Jun 17, 9:36 AM
    Concessionary Mortgage Advice 14th Jun 17 at 9:36 AM
    I have been renting a house from my parents who have said they will sell it to myself and my partner (unmarried) for 15k below market value. (Worth £165k selling for £150k). I however have a few questions I can't seem to find answers for online.


    Does it matter that my partner and I are unmarried as it says 'relatives selling you the house at a discounted price'? We will obviously want to make a joint application.


    Will interest rates be higher than that of a standard mortgage?


    Will we be expected to add any further deposit i.e. 5% or 10% of our own money or will the difference suffice?


    Thanks in advance.
Page 1
    • glosoli
    • By glosoli 14th Jun 17, 10:05 AM
    • 673 Posts
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    glosoli
    • #2
    • 14th Jun 17, 10:05 AM
    • #2
    • 14th Jun 17, 10:05 AM
    When I process these "not at arms length" transactions, our bank policy is that one of the applicants have to be a direct relative to the seller, i.e mother father daughter son.

    We can also process them on a 100% loan to value basis, i.e the full purchase price, so deposits ontop may not be required. The loan to value for the product is calculated the same way, so yours would be 91%, if you were able to get it down to 90% or less then you shoild have access to regular rates at that loan to value tier like everyone else.

    Thats just the lender I work for thought I don't know if its different elsewhere.
    • littletinymouse
    • By littletinymouse 14th Jun 17, 10:22 AM
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    littletinymouse
    • #3
    • 14th Jun 17, 10:22 AM
    • #3
    • 14th Jun 17, 10:22 AM
    Thank you, do you know what specific lenders offer these type of mortgages?


    I just rang Halifax and I spoke to two people who had no idea what this type of mortgage was, the second person I explained it to said I would have to put 10% of my own money on top which I thought was odd - what would be the point in getting this type of mortgage then?


    I think Yorkshire Building Society offer them too but I was wondering if there were any others that you knew of.


    Thanks again.
    • glosoli
    • By glosoli 14th Jun 17, 10:35 AM
    • 673 Posts
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    glosoli
    • #4
    • 14th Jun 17, 10:35 AM
    • #4
    • 14th Jun 17, 10:35 AM
    Because it's slightly outwith the norm the people you speak to on the front line in banks may not be familiar with it or get the information wrong unfortunately - or perhaps they are giving correct information in line with their own criteria.

    However these types of applications are possible but unfortunately I am not at liberty to say on ths board who I work for but if you continue to come up vs obstacles then contact a mortgage broker who should be able to sort it out.
    • Lilla D
    • By Lilla D 14th Jun 17, 2:52 PM
    • 316 Posts
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    Lilla D
    • #5
    • 14th Jun 17, 2:52 PM
    • #5
    • 14th Jun 17, 2:52 PM
    It's called inter-family or concessionary purchase and the lenders doing it normally require the same as what glosoli said that at least one applicant is related to the seller. So your partner not being a relative or a spouse doesn't matter.

    There are lenders who can accept the gifted equity without a further deposit and there will be others who will require additional deposit, it just depends on the lender.

    As a mortgage broker I can't name lenders either, but when you speak to a broker, they will be able to advise you regarding your options.
    I am a Mortgage Broker
    You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
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