Loan for a deposit

Richard_allan

Good evening

Basically wife and I agreed to save for 2 years and get a large deposit for a house. 8 months in she is pregnant, and we have found the house of our dreams. Mortgage offer is ready to go, mortgage lender has agreed to portal our current mortgage at 2% which is excellent. And top up the remainder at 5ish. Current house on the market as of the last few days.

Problem is the deposit, we are selling our car to help but will be about 10-12k short after the government take there 3%.

I know it's not meant to be done but what's stopping us getting a 5 year 15 k loan? Using it towards the deposit?

We can afford the repayments ok.....and the mortgage, just the Ouse popped up annoyingly too soon.

Thanks in advance

Intrigued by some answers....

Rich

CLAPTON

maybe your mortgage company will do a final check on your credit file before completion and decide not to go ahead because of the increased borrowing or maybe not.

Richard_allan

Thanks Clapton

That's what we considered, though we still have HP on the car, 400 per month which the mortgage guys were aware of, we would clear this and the loan paynments would be 270 per month. So better both sides.

We can afford the mortgage, payments no bother just a deposit issue.

Joint income 74 K take home(after tax)

19lottie82

Putting the issue of lenders not looking too fondly upon borrowers using loans as deposits.....

You have a baby on the way, please start as you mean to go on by being financially responsible. A couple of years in a rental will make no difference to your new addition, they won't remember it!

You'll find another "house of your dreams", I promise. Maybe even better. And it will be even sweeter knowing that you saved for it.

Babies are cheap, the older they get, the more this changes, so take this opportunity to save save and SAVE.

PS Think of it this way, if 25 years down the line, your son / daughter was asking you what they should do in a similar situation, what would you tell them?

inmypocketnottheirs

It's like borrowing to save up!!

Tixy

Most mortgage lenders will ask where the deposit comes from - and they may well expect you to provide proof. Borrowing your deposit is not considered acceptable by mortgage lenders these days.

Taking out new credit agreements after having your mortgage offer is a bad idea - particularly sizeable ones. There are people who have ended up really stuck after exchanging on a house, then their mortgage company has run the final credit check before they complete and refused to go ahead with the mortgage and the buyer cannot complete.

Its a high risk strategy to chance borrowing your deposit - I would talk to a mortgage broker before you consider it. Or post on the mortgage section of the forum where you will find mortgage brokers who wil advise you of the pitfalls

jonesMUFCforever

Some banks will not lend on a personal loan for a property deposit.
If you put any other reason on the application and then use it for the deposit you will be making a fraudulent application + as Clapton says if they find out the mortgage offer may well be withdrawn.

You may well claim that you could comfortably afford the repayments but how will the pregnancy of your wife affect your joint salaries after the baby is born?

tell_it_how_it_is

If you want my honest opinion, your problem is the same as it is for many of us - the house of your dreams is out of your reach.

At least for the time being.

Perhaps consider something within range, and upsize later, or, as lottie suggest, save and wait for a while longer.

KingElvis

Loans for house deposits are a complete no no.

DCFC79

Why not focus on trying to save in the first few years of the little ones life, if the house isn't neccessary then put it on a back burner till the moment is right.

Okydoky25

Personally I'd wait. You don't know how things will pan out once the baby arrives. You wife may decide she doesn't want to return straight to work if at all, may chose PT. all will effect you monthly income... And ability to repay mortgage/ loan.