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Quick mortgage question

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pjjafc
pjjafc Posts: 241 Forumite
Part of the Furniture 100 Posts Combo Breaker
in Mortgages & endowments
Morning

I have a house which I'm currently buying thats worth £350,000.

Our inlaws have agreed to sell us the house for £150,000

I want to get a mortgage for £200,000 so we can spend £50,000 on a loft conversion and a small extension out the back

Anyone know if this is possible? Basically will a mortgage company be OK with us spending the extra £50k on improvments?

Please excuse my ignorance as I've never had a mortgage before!

Comments

  • ACG
    ACG Posts: 24,614 Forumite
    Part of the Furniture 10,000 Posts Name Dropper I've helped Parliament
    You might have to go in a roundabout way to do this but in theory a lender wont allow you borrow more than your actually paying for it.

    There are ways with gifted deposits which may work to get around it though.
    I am a Mortgage Adviser
    You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.
  • pjjafc
    pjjafc Posts: 241 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    ACG wrote: »
    You might have to go in a roundabout way to do this but in theory a lender wont allow you borrow more than your actually paying for it.

    There are ways with gifted deposits which may work to get around it though.


    Thanks,

    Do you basically mean that the mortgate company transfer them £200k and then the inlaws transfer us £50k?
  • kingstreet
    kingstreet Posts: 39,269 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Family purchase at undervalue is going to be difficult if the vendors will live in the property after the sale. Is this the case?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • pjjafc
    pjjafc Posts: 241 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    kingstreet wrote: »
    Family purchase at undervalue is going to be difficult if the vendors will live in the property after the sale. Is this the case?

    Myself and my wife currently rent the property from the inlaws. Their total estate is way above the £325k tax threshold so thinking ahead and they are going to sell the property to us to reduce the exposure.
  • kingstreet
    kingstreet Posts: 39,269 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Does that mean they won't be living in it after they sell it?
    I am a mortgage broker. You should note that this site doesn't check my status as a Mortgage Adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice. Please do not send PMs asking for one-to-one-advice, or representation.
  • HappyMJ
    HappyMJ Posts: 21,115 Forumite
    10,000 Posts Combo Breaker
    Do you have a deposit? You can do it in a roundabout way by buying it for £250,000 putting £50,000 down as a deposit then the bank gives you a mortgage for £200,000 and your solicitor forwards the money to the vendor then the vendor can give you the money back after completion for your building works.
    :footie:
    :p Regular savers earn 6% interest (HSBC, First Direct, M&S) :p Loans cost 2.9% per year (Nationwide) = FREE money. :p
  • Conrad
    Conrad Posts: 33,137 Forumite
    10,000 Posts Combo Breaker
    All straight forward, you buy the place for £200k, and they separately between you give you £50,000 back.
  • pjjafc
    pjjafc Posts: 241 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    kingstreet wrote: »
    Does that mean they won't be living in it after they sell it?


    Hi, no they have never lived in it. They have their own home, the house that we live in they own. We currently pay rent to them but want to buy the property from them
  • pjjafc
    pjjafc Posts: 241 Forumite
    Part of the Furniture 100 Posts Combo Breaker
    Conrad wrote: »
    All straight forward, you buy the place for £200k, and they separately between you give you £50,000 back.

    Thats sounds the best idea. We have an estate agent coming round at 3pm to value it (why I dont know!)
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