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mortgage on new build flat ? ? ? ?
thehairybuilder
Posts: 508 Forumite
A colleague , a first time buyer , has the chance to buy a flat in a newly built block due for completion soon. purchase price £85k with a mortgage of £72k
His mortgage advisor today told him this is not possible as no lender will currently offer more than 80% mortgage on a new build flat.
Surely this can`t be correct? I was impressed that he could throw £13k towards the cost and was flabbergasted to hear his advisors comment.
Anybody any experience of something similar or know if there`s anyone out there who will mortgage 85% on such a property?
Any help appreciated
Ta !
Hairy
His mortgage advisor today told him this is not possible as no lender will currently offer more than 80% mortgage on a new build flat.
Surely this can`t be correct? I was impressed that he could throw £13k towards the cost and was flabbergasted to hear his advisors comment.
Anybody any experience of something similar or know if there`s anyone out there who will mortgage 85% on such a property?
Any help appreciated
Ta !
Hairy
I`m now officially too old to die young
0
Comments
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His broker sounds about right. All lenders are running scared of new build flats as they have been stung so hard on this stuff esp Buy to let ones.
Houses seem to be restricted to 85% (though a few 90% exceptions).
He'll just need to find the rest of the cash unfortunately0 -
Surely this can`t be correct?
Yes it can. New build and flat are two swear words in a house price recession. New build flat is therefore double trouble.
Oversupply, builders inflating prices and the automatic loss that occurs when you buy a new build are all issues that scare lenders when house prices are in a downward or volatile cycle.I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.0 -
thehairybuilder wrote: »a new build flat.
...is only new the day you complete. The second after you complete, it becomes a second hand flat...
That doesn't prevent the developer from charging a "new build premium" for the privilege.0 -
I think woolwich will do 85%, not aware of any other lenders.I am a mortgage adviser.You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0
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Jings
Absolutely correct. New build flats a definate no go area for mortgages at the moment
Guess I can almost understand why though
He`s now looking for a small 2 bed house of which there seems to be a few at around the same price
Probably better in the long term with a house anyway
Thanks for replies
HairyI`m now officially too old to die young0
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