questions - offers, mortages, etc.

Dooley

hiya
would love some advice pls, I'm not good on the whole decision making thing! haha

I've had my house on the market since November, with 3 viewings. It was valued at 79k, after two months I knocked it down to 75k. Just had an offer for 70, then they upped it to 72.5k.
I paid £71k in 2005. I had it valued in mid 2007, at which time it was about 85-87k.

I'd like as much as I can get really, obviously, cos I need to be able to afford somewhere else! but estate agent says it's a good offer considering the market. I probably am inclined to agree.
What do you think?

also, I spoke to my mortgage co, and they won't lend me any more! something about they won't lend for more than 80% of the value of the property. so I'm looking at houses for about £85-90k, which means they can't really lend me enough.
However, when I put the figures into moneysupermarket, it comes up with various companies offering mortgages. are these accurate? or is it to suck me in and then when I ring and try and take it - they'll say no too?
I have an independent financial adviser, but they're shut now, and don't know if they'll be open tomorrow!! so was hoping for a bit of advice if possible??

oh, and should I give it all up - sell this house and rent??!!

thanks very much.

eta- whoops I spent mortgages wrong in the title, that's gonna annoy me now!!

zone

I'd take that offer of £72.5k before they change their mind..

hethmar

Well, if you arent going to be able to buy a "better" house at the moment, do you need to move at all?

Dooley

well - I'm not necessarily going 'better'. I mainly want to change locations because 1. this is a really bad area. 2. I want to be closer to work, friends, city centre - so then I'll spend less on transport costs.

I'm happy to downsize to some extent (current house is semi with drive and garage), and I'm looking at apartments. So - I'm ready to move on now, and can afford what I want if the mortgages I'm seeing on the web are accurate.

Sonofa

Dooley wrote: »

eta- whoops I spent mortgages wrong in the title, that's gonna annoy me now!!

See anything else that's gonna annoy you?:D

Dooley

hahahahahaha, money on the mind for that one!
I've had five hours sleep...that's my excuse!

bob79

Given what you paid in 2005 and the valuation at the peak of the market (mid 2007), I think that the offer is good. It's also very close to asking price so you couldn't seriously having been hoping for much more.

What you would like to know is whether the person who offered can actually get the funding. Many people seem to be offering on properties only to then be turned down for a mortgage. Get your estate agent to check this (they can do this by checking that the person who offered has a mortgage in principle or by talking to their financial adviser).

Some lenders are more cautious than others. Your lender is apparently very cautious (demanding a 20% deposit). Most lenders will lend if you have a 10% deposit (the interest rate won't be great though). So moneysupermarket is right on this account.

Whether you should buy a house or rent depends on many things. From a purely financial point of view: look at how the rent of a similar property compares to interest paid on a mortgage.

hethmar

OK, if thats the case and you dont want to spend more on the next property (I thought that was the problem?) then take the offer which appears to be a good one.

RetroBob

Sounds like a good offer, I would have offered less.

Dooley

thanks everyone, very helpful!
I have accepted the offer.

now...on to buying!!!

I looked around a couple of new build apartments today. They're basically two developments across the road from each other.
The apartment I'm favouring due to it being a little bigger is £110, 000. They said they'd let me have it for £99999, and pay 5% deposit.
what does that actually mean? are they just giving me 5%, or is it more complicated? are there any implications.
It's the only one left (out of top floor ones anyway, the bottom floor is 10k less). Should I try and get it cheaper? It is still being built.

The ones across the road a a little smaller, but three storey, and all the same price, of £99999. They said there may be some incentives, but haven't specifically said yet. However, these have been built a couple of years now, and some are up for private sale. I looked at one, which has just been reduced from 99k to 75k. Almost brand new, only difference is I won't get all the goods with it (washer dryer, etc), but I have all my own anyway.

The first ones are saying that I need to use a certain independent financial advisor, and not my own, even tho they assure me that the fa is def 'independant'.... why do I have to use them then??! they say it's because buying new builds can be complicated, and the mortgage situation is a bit different???

any advice on any of that pls?

bob79

It is true that the mortgage situation around a new build is different (some lenders won't lend on it at all and others require a much higher deposit than for an existing house). However, any independent financial adviser should know all about this. So use your own and not theirs.

Given what you wrote earlier about your deposit situation, I don't think new builds are what you should be looking at. But talk to your own independent financial adviser about this.