Drawing profit whilst moving house

auximinies

Can't find any advice online, so thought I'd ask you good people. When I sell my current house I'll make between £30 and £35k profit. I'd like to take some of this money to pay my stamp duty and deposit on my new house (its new build, part ex with Barratts).

Whats the proceedure for getting cash from the profit? I know it'd be cheaper in the long run to pay deposit/stamp duty etc from something not included in the deposit, but I'd have to take on a £10k loan to do so with the added repayments that incurs.

Any ideas/suggestions would be hugely appreciated.

homer_j_3

I am not sure if I have understood this right but I think you are saying that from the surplus funds resulting from the part exchange, you want to know how to pay deposit and stamp duty?

If I have understood you correctly, your solicitor should do all this and give you the remaining surplus. So it is unlikely you will actually see that money, unless you have made alternate arrangements with solicitors.

If I have misunderstood, please could you clarify what you are trying to ask so we may be of further assistance.

Ian_W

Hi auximinies,
I'm struggling a bit to see why you see it as a problem to use some of the profit from the sale of your house as deposit and stamp duty on your new one? That's what most people do when they buy and sell I would have thought. The time it might cause a problem is if you reduce the profit left below 5-10% of the purchase price of your new house, because the mortgage lender will expect that level of deposit.

Say you're buying a £200K house, you'll ideally need a £20K deposit and £2K SDLT, the £8-13K that's left you can either use to make the deposit bigger [and mortgage smaller] or take for some other purpose, though the safest course of action is to keep it in the property.

auximinies

Hi everyone,

Sorry for the stupid questions, first time I've done this.

I need to pay Barratts a deposit a month before my current house has sold - can borrow the cash elsewhere as long as I get it back quickly once my current house has sold.

So just to clarify I can instruct my solicitor to send me a cheque for some of my profits to cover the costs I'l pay out up front? I'm looking at a £30k profit less £8,500 for a deposit and £1,775 stamp duty with the rest added to the deposit on completion to reduce my new mortgage. Its a pain having to find a deposit up front (we're doing part-ex) but we get it back when we move anyway if I'm understanding the process correctly.

Again, sorry to ask so many silly questions, but if you've never done it before....

Ian_W

What is it Chris Tarrant says ... they're only easy if you know the answer!

You just need to explain the situation to your solicitor. You borrow £10,225 and when the sale goes through he remits that to you with the rest [and your mortgage] making up the funds to complete.

I'm not fully au fait with new houses purchases but as it's a part-ex I wouldn't have thought Barratts would have required a deposit on exchange, as strictly speaking they should also be paying a deposit for purchasing yours. Ask your solicitor how that bit works and whether you can pay only the difference between the 2?

HTH & BoL.