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What order to take the steps in?
scotslad1983
Posts: 98 Forumite
Got a tricky situation at the moment, one I look forward to though.
I reside in Edinburgh, Scotland with my wife and we both earn just over £25k each.
We currently own a £150k property (last valued in 2007) and we have £80k approx yet to pay on the mortgage (we are two years into a 5 year fix at 4.79%)
We've decided we want a second child and we need to upsize. We have seen a new-build property we like which is selling @ £275k. They are offering shared (85/15) equity on the property, i.e £234k. There are seven properties to sell so I'm confident there's no major rush.
The house builder (MacTaggart and Mickel) offer a part-exchange scheme which we hope to take advantage of.
Now I am confused about a couple of things: I believe if we were to buy the property outright, we would be stretching our budget and the bank may choose not to lend us the money - but until I know how much the house-builder will offer us for our property, I don't know exactly how much I will need to borrow!
Do I phone the bank up first to check how much we can borrow (hurting our credit rating by checking it..) or do I wait to see how much we will be offered for the property BEFORE phoning the bank?
Secondly, what are the downsides to shared equity? What is in it for the company effectively giving us £41k interest free??
Many thanks in advance for advice.
I reside in Edinburgh, Scotland with my wife and we both earn just over £25k each.
We currently own a £150k property (last valued in 2007) and we have £80k approx yet to pay on the mortgage (we are two years into a 5 year fix at 4.79%)
We've decided we want a second child and we need to upsize. We have seen a new-build property we like which is selling @ £275k. They are offering shared (85/15) equity on the property, i.e £234k. There are seven properties to sell so I'm confident there's no major rush.
The house builder (MacTaggart and Mickel) offer a part-exchange scheme which we hope to take advantage of.
Now I am confused about a couple of things: I believe if we were to buy the property outright, we would be stretching our budget and the bank may choose not to lend us the money - but until I know how much the house-builder will offer us for our property, I don't know exactly how much I will need to borrow!
Do I phone the bank up first to check how much we can borrow (hurting our credit rating by checking it..) or do I wait to see how much we will be offered for the property BEFORE phoning the bank?
Secondly, what are the downsides to shared equity? What is in it for the company effectively giving us £41k interest free??
Many thanks in advance for advice.
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