Buyer doesnt have a high enough deposit

cjt2512

Hello, has anyone got any suggestions, heres my situation.

Im selling my house for £85K my mate wants to buy it but only has 6000 deposit, which is about 7% he needs 10% to get his mortgage, as a seller what options do i have to help him to gain the extra 3%

Ive been told we can put the price up so we get the 3% there, then get 2 solicitors to speak to each other and they can swindle the 3% that way. I no this isnt technically legal but ive heard other people have done this.

Suggestions and thoughts please.

Chris

G_M

As he's a mate why not give him the £1500 he needs?

Or suggest he rob a bank (which is just an alternative illegal way to obtain the money to the one you are considering)?

The bottom line is that he's not really in a position to buy yet. Perhaps you should put your property back on the market, and he should save up for a year or so and then buy?

Cheeky_Monkey

I agree. Afterall, it 's not only the 10% deposit he needs but also the money for the mortgage valuation fee, his solicitor etc.

Annisele

Anything that involves 'swindling' the 3% isn't going to work - and even if it did, do you want to risk a criminal record for £1500?

Putting the price up won't help either. £6k still won't be 10% of the higher price - and anyway the surveyor might value the place at £85k or lower.

Jessikita1983

cjt2512 wrote: »

Hello, has anyone got any suggestions, heres my situation.

Im selling my house for £85K my mate wants to buy it but only has 6000 deposit, which is about 7% he needs 10% to get his mortgage, as a seller what options do i have to help him to gain the extra 3%

Ive been told we can put the price up so we get the 3% there, then get 2 solicitors to speak to each other and they can swindle the 3% that way. I no this isnt technically legal but ive heard other people have done this.

Suggestions and thoughts please.

Chris

Around about the time I bought my house (offered November 2007, sale went through January 2008) and 95% LTV mortgages we abundant, a young couple I knew were buying a house off his sister with no deposit.

I am unsure of exactly how it was done, but somehow she did something to what you are describing. She increased the sale price slightly and "gifted" them 5% of the equity or something along those lines.

It wasn't a swindle or illegal in any way. But unfortunately I am unaware of how to go about it. Maybe have a quick chat with a conveyancer or Solicitor.

Quick tip: I would remove the term "swindle" and the fact you think it is somehow illegal from you original post. You may attract a different response from the knowledgeable posters???

kingstreet

There would be no point pursuing the vendor gifted deposit approach because since the end of July when Halifax pulled out, there is no lender left in the market offering mortgages on such a basis.

atush

If he doesn't have the required deposit, he is not in a position to buy (or even make an offer).

Jessikita1983

kingstreet wrote: »

There would be no point pursuing the vendor gifted deposit approach because since the end of July when Halifax pulled out, there is no lender left in the market offering mortgages on such a basis.

I see. I do remember their mortgage was with Halifax. At the time there were better rates around so I did wonder why they used them specifically. Fair enough.

Atush I do agree with you. I have seen a lot of young people take on a lot more debt than they can handle over the last few years. I understand his eagerness but I agree. Give it another year in that case and get a healthy deposit plus money for fees etc together!

pinkshoes

Sell him the house for £60k?

He'll also need money for solicitors etc... so I'm thinking your friend can't afford to buy your house, so you should just sell it to someone who DOES have the money.

crazyguy

pinkshoes wrote: »

Sell him the house for £60k?

He'll also need money for solicitors etc... so I'm thinking your friend can't afford to buy your house, so you should just sell it to someone who DOES have the money.

I thought exactly the same, if he is a good friend then reduce accordingly to the money he has,

cjt2512

Thanks guys, yeah maybe swindle was the wrong word to use. It's basically two solicitors agreeing to say the house was
For sale for 88 and they have received £8800 deposit when really they haven't, they receives £4400 so the lender releases the 83.5k needed but with only 5% deposit!

Were both in a position were we want to move ASAP so wen your saying save money, that's an option but its going to take time

I have already reduced the house I can't reduce anymore or I can't get my next mortgage.

Apparently there are a few lenders that allow the 5% legally

Chris