First Time Buyer Help!!!

renegade2304

My girlfriend and I are currently looking for somewhere to buy in the Leeds area. She has come into an inheritance of £50k and this is going to act as a pretty hefty deposit (around the 30% mark).

We are currently viewing properties and have viewed 9 or 10 so far (as well as countless on the internet and drive-bys). We had narrowed this down to 2 and arranged for her parents to visit this weekend for our 2nd viewings. Unfortunately we have been advised that one of them (a 4 bedroom detached on at £185k) has had a sale agreed today. This isn't a disaster as it would probably have been our 2nd choice due to it not being in the area we want and was probably a little bit out of our price range. However it has highlighted the fact that we are getting beaten to the punch so to speak as we are a little bit unsure as to what we should have done to this point and what we are going to need to do.

The other property we are viewing tomorrow is a 3 bed semi in the area we want on at O.I.R.O. £169,950. There is currently no chain as the previous owners have moved out and the property is currently on to buy or to let (is that a good sign? I can't quite figure out if that means they're desperate to get rid of it either way or whether they will be happy to let it until they get an offer they like). Following our initial viewing I would not be happy to pay anything near £169,950. It needs a complete redecoration and a new kitchen and bathroom, it looks at present like the previous owners have decorated cheaply and in a neutral scheme with a view to a let. However, my girlfriends father is a registered surveyor so will have a better idea of what it's worth tomorrow.

My main query is that if we do come to put an offer in what do we need to have in place already to be taken seriously? The £50k deposit is in the process of being sorted but we don't yet have it in hand and this is making me a little nervous. It is my girlfriends parents that are dealing with it but due to various family issues this seems to be taking an inordinate amount of time and she won't push them on it (and neither will I as I don't want to appear ungrateful). However, without a firm deposit in place do we even have a leg to stand on in terms of making an offer? I've also been given different opinions as to whether we need an Agreement in Principle for a mortgage? Is this necessary?

In short, assuming we decide we want the 3 bed semi are we in a position to put an offer in and if not what do we need to do?

Any advise will be much appreciated.

Cannon_Fodder

Wait for the deposit to be in your bank account.

If the family are having to go through probate, it could take months. Not their fault, its bureaucracy.

No point setting your heart on a place, then finding you don't have the wherewithall in time and miss out.

renegade2304

There's no probate as it's an inheritance that is being passed over before they die (couldn't think of any nicer way to phrase that).

I'm not going to go into family details but the reason that we don't have the deposit yet is because literally nothing has been done about it despite them telling us that it would be available and to look for a property 3 months ago.

That's what I'm concerned about, that we've jumped the gun on finding somewhere because we've been promised certain things that don't seem to be materialising as expected.

Cannon_Fodder

Maybe they've received advice about the inadvisability of large cash sums leaving the estate at such a time. It could complicate the eventual tax position, and even result in a large chunk having to be found to pay HMRC, after the fact. They can only gift £3k a year, then the taxman cometh.

Don't worry, no need to explain more of the personal family situation. Money and family always creates a delicate situation.

Just sit tight. Maybe drop into conversation that Estate Agents are not taking your discussions with them seriously, while you haven't got the deposit, so you are stopping looking for a while...

It won't necessarily alter the position, which might be out of the family's hands, but you may get an explanation without sounding impatient by asking for one.

TrickyDicky

Cannon_Fodder wrote: »

Maybe they've received advice about the inadvisability of large cash sums leaving the estate at such a time. It could complicate the eventual tax position, and even result in a large chunk having to be found to pay HMRC, after the fact. They can only gift £3k a year, then the taxman cometh.

Only if they die within 7 years. You can gift as much as you want to anyone tax free, but it becomes liable for IHT if they die within 7 years.

Cannon_Fodder

I've read it as being very close to the event, being termed inheritance.

The parents 'dealing with it' has a ring of power of attorney over elderly relative's affairs.

You are right to expand the answer to mention the 7 year rule.

happybroker

I think you will be ok as far as making an offer is concerned and you will need an agreement in principle for the mortgage before the estate agent will take the offer seriously. Be aware that using the EA's mortgage adviser will mean that they will have access to more information about you than if you didn't...like how much you can afford to pay for the house etc.

You would only need to tell them that the deposit is a gift from family.

Getting your agreement in principle now would at least mean you know for sure that you can go out and buy the place once your deposit does come through....this at least would be one less thing to worry about.

dimbo61

Looking at buying a property before you know how much you can borrow is like putting the cart before the horse.You need to talk with a good Whole of market broker to find out the best deals to suit your circumstances.How long do you plan to live in this property?Do you both work ? Full/part time ?How safe are your jobs ? Do you have savings ? Whats your credit score?Do you want a fix/tracker/discount?The list goes on and on.Now you have looked at lots of houses on the net and in the papers but if you cant afford the price why bother looking!Once you know you can borrow say £150K and have a £50K deposit then you can buy that £200K dream home GOOD LUCK