Deposit paid by vendor - can I get a mortgage?

thebarrattfamily

Hi we have been renting for four years now, and have been looking at the rent to buy schemes, which we believe is the only way we are realistically going to get on the property ladder, as we don't have a huge deposit.

I was browsing a property website earlier, and it said 5% deposit paid by vendor. Would we be able to use this as our deposit, or would the mortgage lender want a deposit from us as well?

Sorry if this is a stupid question, we just really want to have our own home, but cannot think of any other way around it.

Thanks for any advice given.

beecher2

You need a minimum of a 10% deposit saved, plus enough money for fees etc. Lenders are wise to these sort of schemes and the likelihood is that they'd take the 5% deposit into consideration when valuing the property.

Debt Free Wannabee forums might help you with your budget in order to save your deposit.

brit1234

With prices falling again lenders are going to want bigger deposits. As said above lenders are aware of all the fraud involving gift deposits and over valuations on newbuilds, hence the much higher deposits needed.

Cut you spending, work extra hours, save and enjoy the price falls. Avoid these scams they are designed to make you overpay for a property.