Mortgage Deposit - This is a bad idea, right?

UrWntr

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Carl31

under 25 and on 65k? wow impressive, what do you do?

mysk_girl

The mortgage company could get wind of this after you've exchanged but before completion. They then pull your offer leaving you unable to complete, then you will lose your deposit and be liable for costs up the chain. That would be a worst case scenario.

I personally think it is a bad idea, whether it is actually mortgage fraud or not, I'm not sure, but I do think mortgage companies would take a pretty dim view of you borrowing for your deposit but not declaring it.

Could you move and rent in a new area for a while? Might not be a bad idea to suss out an area for a year anyway prior to moving. Then cut everything to the bone and save save save!

UrWntr

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UrWntr

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_Andy_

Great, yet another "I'm going to make a fraudulent application" thread.

beecher2

It is fraud - don't do it. Keep saving - why not rent in the area you like for 6months to a year and get your LTV down further? As said above, the added bonus is you get to know the area before buying.

getmore4less

Net income £5k

Why are you only saving £2kpm


Rent for 6-12 month in the new area

Save more and wait for a bargain.

Rushing into a purchase is not sensible.

Is your job secure if convicted of fraud?

FraudBuster

Have a look at what National Hunter does:

http://www.nhunter.co.uk/

mysk_girl

UrWntr wrote: »

This is what I'm worried about but I'm keen to figure out how they would discover this?

When you say 'deposit', do you mean I could lose the whole £25k deposit?

Yes, your 10% would be forfeited and there may be other costs you become liable for. This is my understanding of a sale contract, I've bought a couple of houses and I'm sure my solicitor said if we exchanged but didn't complete we would lose our 10% completely.

Lenders do do credit checks and will be suspicious of loans taken out immediately prior to application. They will ask questions.

This is a bad idea, IMHO.

If you rented for another year, you would have another £25k to add to your deposit, you might even be able to tighten your belts and get to the 80% LTV bracket. Better interest rates there! Don't forget you need money for fees, searches, surveys, moving etc. I would set aside a few thousand for that, plus will you need furniture in your new place?

RedFraggle

I'm not too sure why you want to pretend it's a car loan? There is nothing to stop you applying for a loan and declaring it at mortgage application as a personal loan with repayments of x-amount per month. Provided you can borrow the mortgage amount with that accounted for then there wouldn't be a problem. Why be fraudulent?
If you are not actually buying a car, then any "car loan" would be an unsecured personal loan anyway (you wouldn't get a secured loan without actually getting a car) so it is of very little consequence to the lender what you would be spending it on.