20K short on deposit for a house

daverave7

Hello, I'm looking to move house and it would be financially beneficial if I port my existing mortgage which is 1.49% above base rate and 75% LTV. However, in order to raise the 25 % deposit I will be left 20K short. I know I could get an 85 % mortgage but rates and repayments will be much higher. Is there anything illegal by balance transferring cash from credit cards or taking out a personal loan to top up our deposit?

kingstreet

Nothing. As long as you declare it to the lender on your application.

Have they actually told you your new purchase/mortgage has to adhere to the original loan to value band?

daverave7

Yes, they can only port mortgage at original LTV - have checked this out. Also additional borrowing, which will not be much (<20k) will be at a different rate... Am guessing the SVR.

_Andy_

The lender probably won't accept it as a source of deposit.
Also good luck finding a personal loan provider willing to lend for that purpose.

daverave7

_Andy_ wrote: »

The lender probably won't accept it as a source of deposit.
Also good luck finding a personal loan provider willing to lend for that purpose.

Yes, but owe my partner 20K from when she helped me out with credit cards before. It's about time I repaid her. Nothing wrong getting a loan now to pay her back in full? There's plenty of good loan deals out there at the moment. And whether she wants to use that money to fund a deposit is her business.

_Andy_

No, it's also the lender's business. They will ask you for the purpose of the loan.

daverave7

_Andy_ wrote: »

No, it's also the lender's business. They will ask you for the purpose of the loan.

To consolidate existing debt. Lenders often give loans for that reason.

_Andy_

daverave7 wrote: »

To consolidate existing debt. Lenders often give loans for that reason.

However you clearly stated in the OP it was for a deposit.

But obviously you know better and are happy to make a fraudulent application. Oh you're so cool!

daverave7

_Andy_ wrote: »

However you clearly stated in the OP it was for a deposit.

But obviously you know better and are happy to make a fraudulent application. Oh you're so cool!

I since stated it is not for a deposit. It is to pay my partner what I owe her. How is that fraudulent? I'll feel better about it too as I won't owe her money anymore. Of course she can then use it for a deposit if she wishes? Is that fraudulent? Please let me know as I wouldn't want to get into trouble

Idiophreak

daverave7 wrote: »

I since stated it is not for a deposit. It is to pay my partner what I owe her. How is that fraudulent? I'll feel better about it too as I won't owe her money anymore. Of course she can then use it for a deposit if she wishes? Is that fraudulent? Please let me know as I wouldn't want to get into trouble

It's a massively grey area.

Plenty of people have, say, a loan for a car...and then pay for a deposit from "savings" - but clearly the car loan is, effectively, going in to the deposit. Is that fraud? Doubt it.

Plent of people have, say, credit card debt...if they keep the credit card debt and pay for a deposit from "savings" - is that fraud? Doubt it.

Plenty of people tart on credit cards and just keep the money in "savings". If these "savings" are then used as a deposit..is that fraud? Lord knows.

If you take a loan and say "it's for a car" and then spend it on a deposit. That's fraud, two times over, as you're lying to both the lender ("it's for a car") and to the mortgage company ("the deposit's from savings").

Beyond that, though, I think your own morality guides whether you're committing fraud or not. I've never heard of anyone being prosecuted for applying for a mortgage whilst having balances on their credit cards...

daverave7

Idiophreak wrote: »

It's a massively grey area.

Plenty of people have, say, a loan for a car...and then pay for a deposit from "savings" - but clearly the car loan is, effectively, going in to the deposit. Is that fraud? Doubt it.

Plent of people have, say, credit card debt...if they keep the credit card debt and pay for a deposit from "savings" - is that fraud? Doubt it.

Plenty of people tart on credit cards and just keep the money in "savings". If these "savings" are then used as a deposit..is that fraud? Lord knows.

If you take a loan and say "it's for a car" and then spend it on a deposit. That's fraud, two times over, as you're lying to both the lender ("it's for a car") and to the mortgage company ("the deposit's from savings").

Beyond that, though, I think your own morality guides whether you're committing fraud or not. I've never heard of anyone being prosecuted for applying for a mortgage whilst having balances on their credit cards...

Cool, so what I'm doing is not fraudulent unlike what andy said. Neither I think it is immoral... I'm just saving money