Mortgage question...

Sumaspikey

Hi all, and sorry for the vague thread title!

We have been planning on buying my mothers old house next year after selling ours, however, a member of the family has just told us that because we have very little or no equity in our house due to the drop in house prices, we don't have anything to put down as a deposit. The thing is, we bought our current house for around £108000, of which we paid a £5000 deposit, and that was in late 2007. The house we are moving into is valued at around £150000, but my mother will be knocking 35-40k off the price as my inheritance. I was hoping that we would be just be able to transfer the mortgage to the new house? Would that not be a possibility? What are our options? If we stay with our current mortgage provider (was GMAC but the mortgage was transfered over to a company called Webb Resolutions), would we still have to find a deposit?

Any help would be greatly appreciated, as we were really looking forward to this!

Marc

GMS

As you would be buying from your mother you could use a 'gifted deposit'. Basically you would pay the full valuation for the property but only borrow the amount required, i.e less the inheritance amount.

Speak to a 'Whole of Market' broker when the time comes.

Sumaspikey

Thankyou for the super quick response GMS.

Am I right in thinking, after reading what you have said, that the lender would see the £35-40k as the 'gifted deposit'?

We are looking at putting our house on the market just after Christmas, so what would be our first steps? I take it we need to discuss this with our current lender? If so, I think my wife tried that today, but they weren't much help. They could not advise about mortgages as they aren't a broker.....i believe they just collect the payments on GMAC's behalf....or something like that.

When you say 'whole of market' broker, who or what do you actually mean? I gave it a quick google, but I'm still none the wiser.

GMS

Sumaspikey wrote: »

Thankyou for the super quick response GMS.

Am I right in thinking, after reading what you have said, that the lender would see the £35-40k as the 'gifted deposit'?

We are looking at putting our house on the market just after Christmas, so what would be our first steps? I take it we need to discuss this with our current lender? If so, I think my wife tried that today, but they weren't much help. They could not advise about mortgages as they aren't a broker.....i believe they just collect the payments on GMAC's behalf....or something like that.

When you say 'whole of market' broker, who or what do you actually mean? I gave it a quick google, but I'm still none the wiser.

The provider you are with now will most likely be a servicer rather than a lender so would not lend you anything.

A 'gifted deposit' would be treated as if it were cash, subject to meeting criteria which is usually from a close family member which yours would be.

You would need to find a new lender. A 'Whole of Market' broker is one who is not restricted to a panel of lenders.

You would benefit from broker advice on this one.

Sumaspikey

Excellent. Thanks again for your help. We have arranged a valuation already, so will be speaking to a broker very soon.

ATB

Marc