Should we take out a loan to pay the deposit on a house?

Thrugelmir

Lynn240 wrote: »

Yes so what im saying is its going to be complete and approved then we exchange contracts then we can get a loan for 4 grand then how will the mortgage lender know about it?

Under the mortgage monies advanced a few days prior to completion. The mortgage offer can still be withdrawn.

A change in your credit score caused by an application for credit of any kind could impact the decision.

My personal recommendation is that you postpone house purchase until you have the necessary funds in place. Saved funds that is. As losing a £1,000 is obviously a sizable sum to you. Taking the risk you propose is foolish to say the least. As lenders have seen these tricks many times before and have mechanisms to identify and detect.

Lynn240

Thrugelmir wrote: »

Under the mortgage monies advanced a few days prior to completion. The mortgage offer can still be withdrawn.

A change in your credit score caused by an application for credit of any kind could impact the decision.

My personal recommendation is that you postpone house purchase until you have the necessary funds in place. Saved funds that is. As losing a £1,000 is obviously a sizable sum to you. Taking the risk you propose is foolish to say the least. As lenders have seen these tricks many times before and have mechanisms to identify and detect.

Right thank you for your advice. Time to sit down and talk to the partner

mrginge

No, the mortgage is not 'complete' when you exchange contracts.
It is complete when the lender gives you the money. I.e 'on completion'. They can pull out at any time before giving you the money, so any stupid idea about applying for more credit and/or lying about the reason behind doing so puts you at more risk of that happening. Then, if you have exchanged, you still have to find the money from somewhere.

You have clearly decided that you want to get this loan, so just go for it. You've been told the risk.

beecher2

Lynn240 wrote: »

Right thank you for your advice. Time to sit down and talk to the partner

And developer as you need to delay purchase until you have the deposit saved. As has been said, the worst case scenario is for you commit to buying this place and then have the mortgage pulled. Remember this could happen regardless of whether you have applied for a loan or not, so you really need to ensure the mortgage is in place before commiting yourself fully.

Hasn't your solicitor explained any of this to you?