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Is this legal?
Comments
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BurningMad wrote: »Thanks for your reply.
It then changed and it was then going to be a mortgaged buy using this £10,000 as a means to obtain more money than they could actually get. The solicitor said it was okay and was only being done so they wouldn't have to worry about putting money in for a deposit.
It is now supposedly a cash buy.
Surely to inflate the purchase price to get a bigger mortgage is fraud! I know they are now going for a cash buy but surely this gives you some indication of their practices. Using their solicitor is something that would have immediately rang alarm bells as well.
What is to stop you from refusing to pay over the £10,000 once you have received it? If I were you I would think seriously about pulling out or at least telling them that you are going to employ your own solicitor and if they don't like it the deal is off, they can hardly complain given the messing about they have done.0 -
Just to add, I would sell a house this way, but never buy one.I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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It is quite legal.
N.Never be afraid to take a profit.
Keep breathing. :eek:
Just because I am surrounded by FOOLS does not make me wise. :j0 -
It then changed and it was then going to be a mortgaged buy using this £10,000 as a means to obtain more money than they could actually get. The solicitor said it was okay and was only being done so they wouldn't have to worry about putting money in for a deposit.
People are getting very confused about this...
Reporting the gross value to the land registry is not in itself illegal. You are supposed to support net values under new rules but as far as I can tell there is limited sanction for a 'mistake'.
Using a gross value to get a mortgage is FRAUD.
from http://www.evolvedconveyancing.co.uk/conveyancing-glossary/g.aspGifted Deposit Gifted Deposit is a term used to describe a sum of money usually offered by the seller against the purchase price of a property towards the purchaser’s deposit. This kind of incentive is often seen in new build conveyancing transactions. Conveyancing solicitors acting on behalf of purchasing conveyancing clients using a mortgage to fund the purchase a required to report incentives such as gifted deposits to the mortgage lender who may vary the terms of the mortgage in response. Purchasing conveyancing clients should always inform the mortgage lender when making their official application for a mortgage of any incentives offered by a seller to ensure the incentive is acceptable to the lender. Failure to disclose an incentive to a mortgage lender by the purchasing conveyancing client or their conveyancing solicitors could be deemed mortgage fraud and is a serious offence. The seller’s conveyancing solicitors may ask the purchaser’s conveyancing solicitors to confirm a Gifted Deposit has been reported to the purchaser’s mortgage lender.0 -
princeofpounds wrote: »People are getting very confused about this...
Reporting the gross value to the land registry is not in itself illegal. You are supposed to support net values under new rules but as far as I can tell there is limited sanction for a 'mistake'.
Using a gross value to get a mortgage is FRAUD.
from http://www.evolvedconveyancing.co.uk/conveyancing-glossary/g.asp
Agree, but it would be fraud by the buyer not the seller if the gifted deposit was not declared. I suspect the way round is that the contract is assigned to a third party who will be the one making the mortgage application, whereas the buyer is the one who will get the £10k "gift".I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0 -
BurningMad wrote: »
The original intention was for a cash buy.
It then changed
You sure about that. Maybe they never intended to cash buy but said so just to sucker you in!!!!0 -
Agree, but it would be fraud by the buyer not the seller
True. The OP is not fradulent, but the point is more general, why would you want to deal with people like that?0 -
princeofpounds wrote: »True. The OP is not fradulent, but the point is more general, why would you want to deal with people like that?
If I'm selling a house I'll take money off whoever wants to buy it. As long as their money is good, what difference?I'm a Forum Ambassador on the housing, mortgages & student money saving boards. I volunteer to help get your forum questions answered and keep the forum running smoothly. Forum Ambassadors are not moderators and don't read every post. If you spot an illegal or inappropriate post then please report it to forumteam@moneysavingexpert.com (it's not part of my role to deal with this). Any views are mine and not the official line of MoneySavingExpert.com.0
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