Borrowing on a repossessed house...so confused!

LittleLeah

Hi,
This is my first post but I've been following this site for a while and find a lot of the advice really helpful, so hopefully someone will be able to offer me some advice.

My husband and I are going to put in an offer (the closing date is this Wednesday) for a repossessed property which is o/o £75,000. The house is in a real state, needs a really good clean (I've never seen such a filthy house to be honest), a new kitchen, bathroom, flooring etc. We think it would cost around £10,000 to get up to a decent standard. However, once we have put down a deposit, paid solicitor fees etc, we will only have a few thousand left. My husband thinks we will be able to borrow on the house once we have undertaken some of the initial work, as similar houses in the same street normally sell for over £100,000.

But, I'm starting to panic - we have two kids under 4 and were planning on moving into my MIL's for approx 6 weeks while we worked on the house as it is not in a liveable state. I am starting to worry that we will not be able to borrow on the property. Does anyone know whether it would be possible to borrow on a recently repossessed house? Will there be enough equity? I'm very confused and starting to panic. I know it would be a lovely family home when it was finished and we would have a smaller mortgage than we do at present, but I just don't want to end up left with a mess that we can't afford to do up.

Would really appreciate some advice please. Sorry for the rambling post!

before_hollywood

erm.....i'm in the best position to answer this one i think.

i found a repo place last easter, paid 70k for it, ended up with a 5k retention on it, used 11k of my own money on the deposit and my dad borrowed 8k, i put down another £2k of my own and are waiting on 5k coming back from the , mortgage company, we had to do allsorts, new roof, rewire, new carpets, taking out rotting wood from the outhouse. it still has some things it needs (would love a new kitchen) but its a lot better now. and how many other single blokes have a large 3 bed town house worth 80-90k, 80k is a conservative estimate lol, should know more tomorrow when its revalued for the retention being paid back.

house over the road is done up to within an inch of its life and is smaller and on the market for 120k, if you have a link to your place pm it to me if you want my opinion, if you dont feel comfortable doing so i understand

vegasbaby100

I personally would not assume that you will be able to borrow further money on the property once you have brought it repo or not.

Vincenzo

I did more or less what you are planning with my last house. It took me 2 years to fully complete the project.

You need to be sure you can get hold of the cash without relying on a remortgage, especially in this climate.

Also £10k sounds very cheap to me to do up a whole house. Make sure you get full quotes (not estimates!) before committing.

PasturesNew

You can't assume you'll be able to borrow against it. But it is possible.

It all comes down to how much money you're putting in -v- what it's worth now -v- what you're trying to remortgage at -v- what it's valued at when you apply to remortgage.

So it's maths, but you aren't in control of some of the numbers.