Help! Is discount a deposit?

jayellekay

We are looking at buying a new build home.

The price is £330k, and we have been told this is non-negotiable.
If we are able to exchange within 4 weeks, we will then get a 10% discount.

Do you think that as the £330k is a real price, would our bank accept the 10% discount as a deposit for our mortgage? Our bank has said we need 10% deposit for the house purchase.
So if we can meet the 4 week deadline, we would get £33k diso!!!! (our deposit) and would only need a mortgage of £297k.

Would the bank accept this do you think?

ANy help would be appreciated. I am off to speak to them on wednesday, so would be good to know if I need to phrase this slightly differently as a proposal!

Thanks

silvercar

Depends on the bank. Some will accept a vendor gifted deposit, some won't.

Lets face it, the discount is to encourage you to move quickly, if the property really was worth 330k they would hold out for the full price.

thepeachyone

I think this will depend on the lender. There are several schemes I have looked into for new build. They include the 85% 15% shared equity, where the 15% is a loan from the developer, the ones through housing associations where you can buy 50% to 90% and the housing association owns the rest which you can buy in future. Also the deposit match schemes. The first lenders and developers I approached said you will still need a deposit to go with your mortgage and I couldnt lend 100% of the 85%, if I was buying 85% on a shared equity, if you see what I mean.

However, the co-op bank I was told that if I was buying into a certain development and buying either 75% or 50% of the home in question, then the co-op would loan me all of the 75% or 50% (whichever I was able to afford) but it wouldnt count as 100% mortgage, just as a 75% or 50% one. They were on their own in thinking this, so I applied, but its taking absolutely ages.

I suspect the answer is it depends on the developer and the terms and conditions of the discount.

bluegrover

I wouldn't be bullied by the 4 week deadline. If they're prepared to give 10% with a deadline, then they can give that without a clause too. I would ask for more, regardless of their "no discounts" comment, especially as they have then offered a discount! It's a buyers market, especially for new builds.

Have the prices gone down already? If not, then look for a bigger discount. The key is not to sound desperate and don't go running after them.