no deposit for mortgage. woud this way work?

michelle198477

i am currently looking into buying a house. initially i thought it would be possible to take enough out of my pension pot for a deposit (but this is not possible as my pension wont allow it).

Does anyont know if i could take a personal loan out for the deposit(say 8k)

then if i saw a house for 80k would i be able to get a mortgage for 90k in order to pay the personal loan off

Thank you

jimjames

There were some other threads asking the same thing and the answer was basically no. You'd have to inform the mortgage company where the source of your deposit came from.

Could you not save the money over the next 12 months or so? If you have no money saved then you will also struggle having bought the house if you need to pay for repairs or any emergencies. You will also need additional funds to cover the purchase itself which could be between £1000 and £2000.

HappyMJ

Only if you could afford to pay both the personal loan and the mortgage at the same time. If you had an income of £40,000 I don't see why you can't get a personal loan for £20,000 then try and get a mortgage for £60,000, (Certainly not £90,000), to buy a property worth £80,000. It wil meet the affordability and you will get a good rate on the mortgage. When the mortgage provider asks the questiion "What is the source of the deposit?", you will have to say from a personal loan.

holly_hobby

Personal loans - the provider will base the loan on your income, age and what the finance is for. Generally speaking they don't allow it for property investment - which is what the monies technicallly is for.

Loans such as this are for debt consolodation, home imps, buying a car etc ..sometimes the provider doesn't actually ask what is for, but do state that the monies can not be used to pay tax bills, for gambling or investment or for the pch of timeshare properties.... you get the idea.

You may also need to disclose the source of your deposit to the mge lender - and of course your income would need to be able to service both the loan and mge.

Max unsecured loan term is generall 7 yrs.

Hope this helps

Holly

_Andy_

michelle198477 wrote: »

i am currently looking into buying a house. initially i thought it would be possible to take enough out of my pension pot for a deposit (but this is not possible as my pension wont allow it).

Does anyont know if i could take a personal loan out for the deposit(say 8k)

then if i saw a house for 80k would i be able to get a mortgage for 90k in order to pay the personal loan off

Thank you

No mortgage lender will accept a personal loan as a suitable source of deposit.
Also you'd struggle to find a personal loan provider to lend for that purpose anyway

ViolaLass

michelle198477 wrote: »

then if i saw a house for 80k would i be able to get a mortgage for 90k in order to pay the personal loan off

Not any more, thank goodness!

Why would you need to borrow more than the house is worth?

handytips

The only answer to this is. Start saving. Sorry but thats the truth of it.