More help please! Trying to move. Soooo complicated! Renovation, finances, valuations

jennieshrew

More help please! Warning, I'm not one to shirk a challenge so although you will all think this is impossible there is no point in telling me it cant be done. I need to try to do this.

We have found a house we love.

We had our house valued today and got 5 different valuations

205k, 195, 190, 185 and 185.

Why are they all so different?

We think we need 195 in order to move.

Mortgage broker thinks we will need to put down a 15% deposit on new property.

New house needs total renovation. It is on for 220k but estate agent, locals, family who live locally and surveyor all think it isnt worth anything like that. Locals think its worth 160k.

and was hoping to:

a) sell our house for 195k
b) put down 10% deposit on new property
c) use the rest of our equity to renovate new house.

We dont have money for fees and conveyencing but we have family who will help if required.

Also to complicate further I have just swapped to a fixed rate with current lender who will let us port accross mortgage rate to new property but didnt tell me that they would also want a credit score, affordability test and full mortgage application to move mortgage, even in for the same amount. I thought they would just want to look at the property details and do valuations. They were happy to let me remortgage without the extra tests. :mad:

Also we are only paying interest only at the moment with no endowment and they will want evidence of an investment vehicle for the move.

If our offer of 160k is accepted on new house then deposit would need to be 24k if it was 15%. This wouldnt leave much for renovations. Especially if lower valuations are correct.

New house needs lots of work so will mortgage company make a retainer on the mortgage? If so is there any way I can move? What small steps can I make to remove some of the issues above?

I need some positivity!

Burridge60

Did you tell the lender you wanted to move whtin the next 12 months?

jennieshrew

No I didnt. Very annoyed with myself. Wish I had asked more questions. I just asked the costs if we were going to move. I specifically asked if we would be able to move house and what the costs were.

Burridge60

I am afraid Jennie that the time to talk to the Broker was some months ago.

He is now trying to land a 747 at Heathrow with his eyes blinded by smoke whilst trying to serve a passenger in economy with a lager.

Did I mention with two out of four engines on fire!

jennieshrew

yes I know, too little too late. I have only just seen the house we want to buy. I thought I was still in the cooling off period with existing lender but damn I called on the 15th day!

WHITEVANMAN

jennieshrew wrote: »

More help please! Warning, I'm not one to shirk a challenge so although you will all think this is impossible there is no point in telling me it cant be done. I need to try to do this.

We have found a house we love.

We had our house valued today and got 5 different valuations

205k, 195, 190, 185 and 185.

Why are they all so different?

We think we need 195 in order to move.

Mortgage broker thinks we will need to put down a 15% deposit on new property.

New house needs total renovation. It is on for 220k but estate agent, locals, family who live locally and surveyor all think it isnt worth anything like that. Locals think its worth 160k.

and was hoping to:

a) sell our house for 195k
b) put down 10% deposit on new property
c) use the rest of our equity to renovate new house.

We dont have money for fees and conveyencing but we have family who will help if required.

Also to complicate further I have just swapped to a fixed rate with current lender who will let us port accross mortgage rate to new property but didnt tell me that they would also want a credit score, affordability test and full mortgage application to move mortgage, even in for the same amount. I thought they would just want to look at the property details and do valuations. They were happy to let me remortgage without the extra tests. :mad:

Also we are only paying interest only at the moment with no endowment and they will want evidence of an investment vehicle for the move.

If our offer of 160k is accepted on new house then deposit would need to be 24k if it was 15%. This wouldnt leave much for renovations. Especially if lower valuations are correct.

New house needs lots of work so will mortgage company make a retainer on the mortgage? If so is there any way I can move? What small steps can I make to remove some of the issues above?

I need some positivity!

A lot of issues here.
Firstly is the new house habitable, Lenders wont take a good view on a property that is without certain living conditions reported by the survey, mostly with regard to kitchens and bathrooms.
Secondly If it is in poor condition surveyors are being very cautios with the valuations for mortgage purposes in the current climate, and may come in with very low valuations on poorly maintained property, which may give you problems with the LTV and potentially force you to use some of your equity.

Dont expect more than the £185000 though based on the valuation range you may well achieve £190000+

Although you are port rating your mortgage, you will be mortgaging a new property that is why you need to go through the full proceedure.

Maybe you could invest for a month if necessary in that investment vehicle

Most deposits should be around 10 percent.

Sorry not more positive, but you will have options open to you to cover most situations it all depends on the process, Get your offer in and work it from there.

jennieshrew

Thanks we have a friend who is a surveyor who is going to take a good look at new property next week with us so we can get an idea of value and work required. house has had an old couple living in it but I'm not sure a bank would call it habitable. bathrooms ok. kitchen dodgy but there is one....

jennieshrew

I would think the new house needs rewiring and damp course.

jennieshrew

Ok I have ticked one thing off my impossible list.

Phoned existing mortgage provider to do a new affordability check.

They have approved in principle a new mortgage at the new property just on an affordability basis. We can do a 10% deposit as they will honour the existing LTV on our current mortgage. We would have to swap to a repayment mortgage but I would want to do this anyway I think as we cant keep paying interest only.

So issues outstanding

Retention issues on house which needs work (surveyor coming on Wednesday can advise us on this)
Selling price of our existing property
Passing the credit score (HELP! Experian report says satisfactory for everything but have been turned down for credit recently)

Am getting conveyencer quotes. Would like to find one which doesnt charge unless you complete. Have had some details of ones which do this but need to compare prices against standard arrangement.

Sorry for rambling to you all but its helping to clear my mind.

jennieshrew

Another issue - how to fund renovations. Would have a small pot left over but nowhere near enough to pay for the basics which need doing.

Would like to add to mortgage long term.

Burridge60

So fixing your rate before you move has worked in your favour!

There can be circumstances where your current LTV is say 80% but when you move and borrow to make the purchase and having met all the fees and costs you need 90%.

Some mortgage lenders will honour the "old" LTV deal.