Using a loan to top up deposit?

Jamsmyth

Whats the general feeling on using a loan to top up our deposit?

I have an excellent credit rating but only a 10% deposit for a property I want to buy whats the thoughts on using a loan to top up the deposit to 15%?

I have worked out the figures and can afford the monthly repayments alongside all other out goings but not sure how likely I am to get one for this purpose?

I have not gone through the process of applying yet as I dont want the searches prior to securing the mortgage.

Any ideas?

Wickedkitten

The fact that you have used a loan as part of your deposit will count against you

Smallfries

i always thought that using credit to obtain credit is a no go, not allowed i dont think, but not sure how they would know its a loan for that purpose

princeofpounds

They will know you have the loan as it appears on your credit record, and they will insist it is rolled into the mortgage, so it won't count towards a deposit.

Having said that, the systems aren't perfect and in the past people were getting away with this by taking unsecured debt at one address and their mortgage from another. Of course this is probably criminal as you will be asked to declare any pre-existing debts so hiding it would be a deception.

Smallfries

sorry, didnt make that clear, they will know you have a loan but you could say it was for car repairs etc. i wouldnt do it myself

brit1234

Smallfries wrote: »

sorry, didnt make that clear, they will know you have a loan but you could say it was for car repairs etc. i wouldnt do it myself

Thats dishonest and the OP will be commiting mortgage fraud.

_Andy_

brit1234 wrote: »

Thats dishonest and the OP will be commiting mortgage fraud.

Sadly many on the MSE forums seem to think fraud is perfectly acceptable and a great idea. (Probably the same ones who when they're struggling to afford both payments in a few years time will be on here moaning how they were 'mis-sold' and asking how the loan can be written off blah blah blah)