50/50 deposit - does this sound viable?

aimingforadebtfreelife

Hi all,

Looking at a house £135k and believe there could be a big discount as they need a quick sale, houses in area not moving quickly and we are in rented so no chain.

I would say they might accept £120k as we are in a strong position with no chain.

BUT... heres the tricky bit. We have scrimped and scraped to get about £6k in savings. To get a decent rate we really need 10% deposit.

So... does this sound viable..... We offer £126k for the house on condition they put 5% towards the deposit (£6k) - so in the end they would accept £120k for the house... we put in just over £6k to make up the 10% deposit and access better rates and acceptance.

Any views/thoughts greatfully received.

CloudCuckooLand

Are you real FTBs? Never owned a house before? If you are not, then be careful of the £125k Stamp Duty threshold. Silly to incur 1% fee. The buyer may be expecting to get talked down to that. £120k could be ambitious.

By the time you pay solicitors fees, mortgage costs, survey, other incidentals etc, you may well have spent £2k, so will you really have £6k available? Even if you have fees/costs saved seperately and the vendor went for the idea, the 50/50 option really restricts the range of lenders. Costing you more than just the extra interest on the £6k, as you'd be unable to source the best deals. A 10% deposit only secures basic deals not "better rates", anyway.

In light of your recent thread, your mortgage difficulties would not make you such a brilliant prospect to the vendor anyway. They may not agree that you are such a "red-hot" buyer, to warrant a large discount for your "strong" position. https://forums.moneysavingexpert.com/discussion/2954120

They could find themselves wasting weeks while you fail to secure a mortgage...and you'd have spent money on fees/survey that could have stayed in your deposit fund until your credit position was genuinely strong.

Keep saving.

GMS

Not all lenders will allow a vendor gifted deposit.

Speak to a good broker. There are options for this but you would need to fit criteria.

beecher2

Keep saving until you have a 20% deposit - with your default you're unlikely to get a 90% deal even if they lender was happy with a vendor gifted deposit.