am i being ripped off by mortgage lenders

geoff1057

i am single girl,trying to get on the property ladder.... have saved hard for a deposit for a house ,fees surveys solicitors etc , and applied for a first time buyer 90% mortgage, no problem ,will lend me the money but needs a small amount of damp prob sorting ,so lenders are holding back 2k, i spoke to the seller and he has said ok will drop the price ,great. so now lenders have dropped the amount they will lend me and still holding back 2k, but when this problem sorted will return the 2k , i am totally skint havnt got an extra 2k,and it seems that i am having to pay for this house to be fixed up before i can by it. is this right or are the mortgage lenders ripping me off .

GMS

They have imposed a retention which is correct if there are issues.

Your borrowing will be based on the LOWER of the purchase price or valuation so if the purchase price changes so does the borrowing.

You ar enot being ripped off.

If the vendor is wiling to drop the price ask them to have the work done instead.

Thrugelmir

Your mortgage lender is seeking an undertaking by making a retention that you will have the work done. Thats not ripping you off.

If money is tight. Ask the vendor to have the work done first.

kingstreet

A reduction in the purchase price only helps you if you have the money to make up the retention to enable you to buy the property and get the work done, paying for it when the retention is released.

If the surveyor valued the property at the previously agreed price following the remedial work, I'd agree with the others. Ask the vendor to get the work done (perhaps between exchange and completion for his security?) on the basis you will pay what was earlier agreed.

The only problem here is the vendor may not want the hassle, especially if it's damp course work and plaster has to come off, in a property he's still living in.

Burridge60

Are you buying a wreck?

Only way they do retentions nowadays

Edit to add I think the mortgage lenders are telling you to walk away quickly !

Bless their cotton socks!

_Andy_

Yet again a 'rip off' thread where there isn't one.

opinions4u

kingstreet wrote: »

A reduction in the purchase price only helps you if you have the money to make up the retention to enable you to buy the property and get the work done, paying for it when the retention is released.

Don't forget the £2,000 less capital plus interest that won't have to be repaid over the term of the mortgage.

geoff1057 wrote: »

i am single girl,trying to get on the property ladder....

Called Geoff?

have saved hard for a deposit for a house ,fees surveys solicitors etc , and applied for a first time buyer 90% mortgage, no problem ,will lend me the money but needs a small amount of damp prob sorting ,so lenders are holding back 2k,

That does suggest some very unpleasant damp. Don't underestimate the impact damp and a damp proof course can have on a property.

i spoke to the seller and he has said ok will drop the price ,great. so now lenders have dropped the amount they will lend me and still holding back 2k, but when this problem sorted will return the 2k

This is perfectly normal. Until the property is in good condition their security is impaired.

i am totally skint havnt got an extra 2k,and it seems that i am having to pay for this house to be fixed up before i can by it. is this right or are the mortgage lenders ripping me off .

It's correct and they're not ripping you off.

If you are still intent on buying the property, get estimate for the work that's needed. Estate agents can often help with this but they are acting for the vendor. If a DPC is required make sure there is some form of guarantee that is underwritten not just by the company providing it but some sort of insurance.

I have to be honest, owning a property is a significant step. While you wouldn't be the first person to buy when they are "totally skint" what would happen if a tile fell off the roof? How would you afford to replace it? Properties generate unexpected expenses. If you're skint now, perhaps you should consider saving for another 6 months or so and building up a contingency fund before you take the significant step in to home ownership.

Either way, you aren't being "ripped off".

Burridge60

GMS wrote: »

If the vendor is wiling to drop the price ask them to have the work done instead.

NEVER EVER allow a vendor to bodge the work guarantee or no guarantee once you have the House it is your problem not theirs!

This is going to be your home have the work done by someone you trust.

And read another thread on MSE on having work done between exchange and completion where the lender withdrew their mortgage offer or added more conditions!

RecoveringAlcoholic

am i being ripped off by mortgage lenders

The Fat Cats have to be fed.

geoff1057

_Andy_ wrote: »

Yet again a 'rip off' thread where there isn't one.

ive not accused anyone of ripping me off ,im trying to buy my first property, ive just come on to here to ask a question ,and hopefully get some answers and advice from people who know about these things. which most people have ,for which im very grateful, thank you .
YOUR reply however was totally useless and unecessary