mortgage advice please

mcowan77

Hi

Just had an offer accepted on a house..127k
Tried to get under 125 to avoid stamp duty....no joy!..the seller is leaving behind 4k of furniture etc,so purchase price is 125 plus 2k fixtures and fittings
House surveyed at 145k....

Will the bank lend me the full 127k?

Cheers

mcowan77

Anyone? Plz

Morgage_Confused

you need to give more details m8....and to clarify if this is a typo
"House surveyed at 145k...." ?

beecher2

No, as there are no 100% mortgages available, and because the LTV will be calculated using the purchase price (£125k) rather than the valuation. You need a deposit of at least £12,500 for a 90% (£112,500) mortgage

I'd expect some interest in your 2k fixtures and fittings as it will likely be flagged up as a possible attempt to avoid stamp duty.

mcowan77

Home report value is 145k in jan,it will b refreshed and i expect it to be no less than 140k.
Purchase price is 125k with 2k fixtures and fittings..
I have the 19050 deposit for an 85% mortgage..i dnt want 2 pay the extra 2k upfront...hope that makes sense
Thanks for the replies

Thrugelmir

Tell the Estate Agent you don't want the furniture.

Senior_Paper_Monitor

Let's address the key issue ....... Stamp duty limits for liability.

HMRC are hugely 'touchy' about abuse here, conveyancers are required to declare details (including inventory and individual valuation - which can and may well be audited) of 'chattels' sold outside of the property and 'fixtures and fittings' (which are included for SDLT purposes).

In terms of the lender - loan will be based on lowest of sale price (excluding chattels - as by definition you are keeping this outside the property cost) or valuation, so in this case the sale price (which it appears you are suggesting is £123K) at the LTV agreed by the lender as part of your product contract. You will have to fund the other purcahses in full.

Frankly it appears that your estate agent is trying to pull a 'clever one' which will soon be torn apart by any competent conveyancer.

mcowan77

Thanks for the reply senior....can i include the extras in jhe purchase price.i.e 127k.
Saving me paying the extra 2k upfront?

Senior_Paper_Monitor

You can include it in the price as fixtures and fittings - the total will set your SDLT liability and (provided equal to or less than lenders valuation) will be the basis upon which the loan available calculated on max product LTV will be set.

You can exclude it from the price as 'chattels' (which may well be audited by HMRC and will probably only pass - assuming he/she opts to do their job - the conveyancer's eagle eye if the actual inventory and market values stack up) buit the loan available will be based on 'without chattels' value. i.e you will pay cash for those items outside the mortgage arrangement.

Meeper

Yes. Then your purchase price is £127k and you would need to pay stamp duty instead. £1,270 is better than £2k though.

mcowan77

Can i not add on the 2k extra to my mortgage,bearing in mind the houes valuaion is 140 and im only looking for 85% of 127?