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Right to buy council property
Geriatric
Posts: 66 Forumite
My daughter has a £50,000 discount on purchase. Do building societies look on this as equity and thus make available a 100% mortgage?
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Most do yes...I am a Mortgage Broker
You should note that this site doesn't check my status as a Mortgage Broker, 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.0 -
It would not be a 100% mortgage if they take the discount into account as equity.Thinking critically since 1996....0
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somethingcorporate wrote: »It would not be a 100% mortgage if they take the discount into account as equity.
Fail to understand your reply. I am talking about a 100% mortgage on the price paid. Previous answer covers the position your is of no relevance0 -
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My daughter has a £50,000 discount on purchase. Do building societies look on this as equity and thus make available a 100% mortgage?
Using just as an example a house price of £100,000
1) Are you asking in terms of £50,000 being a 100% mortgage or
2) Are you asking in terms of borrowing £100,000 as a 100%
If option 1 it wouldn't be a 100% mortgage but rather a 50% mortgage.0 -
makes perfect sense to mesomethingcorporate wrote: »It would not be a 100% mortgage if they take the discount into account as equity.0 -
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For calculation purposes mortgage LTV's are generally based on the LOWER of the purchase price OR valuation.
Exceptions are Right to Buy and close family sales.
Getting a mortgage for the whole of the purchase price could technically be argued to be 100% but as it is for (for example) half of the valuation it would be a 50% mortgage.
Only because the discount is a Right to Buy would this be allowed. If you were to negotiate a 50% discount from the man across the street the purchase price would become the valuation and a 100% mortgage would be needed.
Not really worth the argument however many posts appear to be falling into petty squabbles lately.I am a Mortgage AdviserYou 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.0
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