FTB - Deposit advice

garymac

Hi All,

Would be grateful for some advice on our current situation. I appreciate it's probably something some of you have heard time and time again but any advice would be appreciated.

My partner and I both earn £27,500 each, looking to buy a property valued in region of £110,000 (hoping to knock it down to £100,000). We've got mortgage quotes for 90% mortgages which is well within our budget. Neither of us have any credit commitments aside from student loans payable to government.

HOWEVER...problem lies when the word deposit emerges. We don't have £10,000 behind us to act as a deposit.

We were under the (perhaps somewhat misguided) assumption after speaking to friends and family who have been in same position that we could use 'car loans' to act as the deposit. Clearly this would be declared and would be calculated to ensure it is within our budget.

Can/should we do this? I am confident in budgeting that we can afford the repayments or both the mortgage and the loan, however query whether this is the most suitable option given we are keen to purchase this year.

Any help and advice would be gratefully received.

_Andy_

No you can't do it. No mortgage lender will accept a loan as a source of deposit.
In any case if you apply for a loan under the pretense of being for a car that's fraud.

You clearly can't afford to do what you want to do so need to carry on saving.

beecher2

With no credit commitments you should be able to save a lot from over £50,000/year between you. If you save £1,000 a month, it'll only take you 10 months so you'd still be able to buy this year.

switched_off

Or buy using a new build scheme that only requires a 5% deposit?

garymac

_Andy_ wrote: »

No you can't do it. No mortgage lender will accept a loan as a source of deposit.
In any case if you apply for a loan under the pretense of being for a car that's fraud.

You clearly can't afford to do what you want to do so need to carry on saving.

With respect, Andy, I think I know what I can afford and what I can't!! Many thanks for the 'advice' anyway...

In response to the other comments - thanks for the info. We've had info on a new build scheme in the area; unfortunately living in Wales we are not eligible for the 'Homestart' scheme as provided by the government, however Barratt do have their shared equity scheme with an interest free loan of up to 25%. However once again I suspect the banks may take issue with this type of scheme. Anyone had any dealings with this scheme?

VIGILANT22

switched off.......Stop telling porkies ...how long is it since you left the market?

switched_off

VIGILANT22 wrote: »

switched off.......Stop telling porkies ...how long is it since you left the market?

Homebuy Direct - 30% contribution (15% developer + 15% local housing association). Plus 5% client own funds unless in the south where you can put in 0%.

Information most current.

Barrat Scheme requires 5% own funds and can be placed with nationwide and Halifax.

PCH83

I am currently buying a new build with Keepmoat homes. The scheme that i have signed up for is 85/15 and also Keepmoat are knocking 5 % off the price. The 15 consists of 5% from me and my partner and 10% from the lender. In ten years we have to pay back 10% of the current value (value in ten years time) The problem i ahve similar to yours. I was promised part of the deposit by a family member, i've now been let down by that family member. I'm not sure whether i can make up the rest by getting a loan ? ? I have already been accepted for the mortgage. I'm s*itting my pants.

VIGILANT22

garymac wrote: »

With respect, Andy, I think I know what I can afford and what I can't!! Many thanks for the 'advice' anyway...

When you post on here, it is a consumer's forum..it is not mortgage/financial advisors giving advice...even if they have a signature saying I am a Mortgage Advisor......they're not checked..anyone can put a signature on..you could do it if you wanted to....

With a forum like this you ask a question, people then give their opinion/answer, sometimes people have a problem with that...as it is not what they want to hear...it may be right it may be wrong......but hey...it's an internet forum!

If you really want advice.... professional advice...you will meet with a mortgage advisor face to face

switched_off

Sometimes people even accuse others of telling 'porkies' and imply their information is out of date...

garymac

VIGILANT22 wrote: »

garymac wrote: »

With respect, Andy, I think I know what I can afford and what I can't!! Many thanks for the 'advice' anyway...

When you post on here, it is a consumer's forum..it is not mortgage/financial advisors giving advice...even if they have a signature saying I am a Mortgage Advisor......they're not checked..anyone can put a signature on..you could do it if you wanted to....

With a forum like this you ask a question, people then give their opinion/answer, sometimes people have a problem with that...as it is not what they want to hear...it may be right it may be wrong......but hey...it's an internet forum!

If you really want advice.... professional advice...you will meet with a mortgage advisor face to face

Couldn't agree more! Just better sometimes to say nothing rather than something!

Thanks for the advice anyway everyone else; we're in process of arranging to see a mortgage advisor. I guess the shared equity scheme may be more realistic option in short term; I really do not want to rent though!!