just about to buy...

Joe_Bloggs

Fact: Existing loan 79K.

Case 1)
Sell property for 115K then 115-79 gives 36K equity.

Buy for 140K would give LTV of (140-36)/140 = 74.3%

Case 2)
Sell property for 130K then 130-79 gives 51K equity.

Buy for 155K would give LTV of (155-51)/155 = 67.1%

It is easier to get a good mortgage deal if your LTV is lower.
The big assumption is that the mortgage lender will find the Value of the property to be either 140K or as much as 155K.

This may be seen a rouse to ramp up the average selling price of the new build development.

They may be more informed comment on the mortgages board.

J_B.

james3333

Joe_Bloggs wrote: »

Fact: Existing loan 79K.

Case 1)
Sell property for 115K then 115-79 gives 36K equity.

Buy for 140K would give LTV of (140-36)/140 = 74.3%

Case 2)
Sell property for 130K then 130-79 gives 51K equity.

Buy for 155K would give LTV of (155-51)/155 = 67.1%

It is easier to get a good mortgage deal if your LTV is lower.
The big assumption is that the mortgage lender will find the Value of the property to be either 140K or as much as 155K.

This may be seen a rouse to ramp up the average selling price of the new build development.

They may be more informed comment on the mortgages board.

J_B.

excellent, thanks for this.... so i would be better paying the £150 extra in stamp duty to get the LTV lower and hence give me a better chance of getting the lower rates?..... would you say im about right with the rates above too?

Rinoa

james3333 wrote: »

so, what sort of deals could i 'tap into' ...had a quick look at halifax ( my current lender) would i be talking around the 4%APR for a 5 year fix as a rough guide?

Not sure whether Halifax have a 5 year fix. Other lenders are from 3.39% with 70% LTV's but with a sizeable arrangement fee £995-1495.

As Joe Bloggs points out, lenders may not agree with £155k valuation. Only way to find out is to go through the motions and put an application in.

james3333

Rinoa wrote: »

Not sure whether Halifax have a 5 year fix. Other lenders are from 3.39% with 70% LTV's but with a sizeable arrangement fee £995-1495.

As Joe Bloggs points out, lenders may not agree with £155k valuation. Only way to find out is to go through the motions and put an application in.

ok, thanmks for all this info people.
i will try the 155k route first and see what happens, that seems to make the most sense and if not will go the 140k route.
good to know i can get a 'decent' deal at the moment. (im currently on the SVR with my existing house which is 2.5% above BoE base rate, so paying 3%....so its good to know it wont pull my head off moving forward...

Joe_Bloggs

@James3333

The key to the decision is what the mortgage lender values the property at. It is not uncommon for the mortgage lender to value new build properties with enormous suspicion, sometimes at close to a distressed sale value.

You could find yourself out of pocket if you pay upfront survey fees to your lender for a survey that turns out too low to be of any use.
J_B.

james3333

Joe_Bloggs wrote: »

@James3333

The key to the decision is what the mortgage lender values the property at. It is not uncommon for the mortgage lender to value new build properties with enormous suspicion, sometimes at close to a distressed sale value.

You could find yourself out of pocket if you pay upfront survey fees to your lender for a survey that turns out too low to be of any use.
J_B.

i have managed to get the builder to pay for all searches, solicitors fees etc so this shouldnt be a problem....

Joe_Bloggs

I did say survey fees. Perhaps I should have said Survey fees for the purpose of mortgage valuation undertaken by the lender.
J_B.

james3333

Joe_Bloggs wrote: »

I did say survey fees. Perhaps I should have said Survey fees for the purpose of mortgage valuation undertaken by the lender.
J_B.

OH, mmm never thought about this, just assumed that the searches/fees would include this?

james3333

james3333 wrote: »

OH, mmm never thought about this, just assumed that the searches/fees would include this?

oh, the builders have a financial bloke who i have spoken to and he sorted the survey of MY house for free (they tried to get £250 out of me at first, but i haggled and got it for nothing) he also got me agreed in principle for the new house, so i assume that he will sort/its been sorted?

sunshinetours

james3333 wrote: »

oh, the builders have a financial bloke who i have spoken to and he sorted the survey of MY house for free (they tried to get £250 out of me at first, but i haggled and got it for nothing) he also got me agreed in principle for the new house, so i assume that he will sort/its been sorted?

See if you get the same overall deal offered when you say you wish to use your own "financial bloke"

Please use your own solicitor and own finanical adviser/mortgage company if nothing else