Loan for a mortgage 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....

The other option is using the loan to clear the car HP (405 per month) , loan repayment is 270 per month, so less outgoings, but retain the deposit funds needed.

Once wife's off work income will remain more than sucficient to meet all payments with some led over.

harvey115

Another option would be to haggle with the seller on the house price.

If you are near the £250K price bracket for Stamp Duty, try to stay that way to pay less stamp duty. It is also a good way to request the seller for a bit lower house value.

StuC75

What selling price for your house are you basing your assumptions on? If that price gets knocked down (every likelihood then you would have a bigger gap to cover)..

Loans for deposits are frowned on - but if it were an existing commitment (at the time you apply) then unsure this be flagged; and then likely to just affect afforability calculations in terms of the payment commitments.

When the Wife is off work, just how comfortable would finances be.. Word of caution as in my case the Mrs decided to return to work only Part Time after - be prepared for a longer term change to the normal (I fortunately had ensured we werent too stretched when moved).

Yorkie1

You will have to declare the source of your deposit on the mortgage documents, and potentially provide evidence of it to the lender i.e. bank statements. Don't consider lying as that's fraud.

The lender might well do a credit check on you, and will notice the loan if you haven't declared it either on commitments or (if relevant) on deposit source.

The lender will deduct the loan from what its affordability calculations for you.