Re-Mortgage/New House/Shortfall Advice Needed

WF3

Hi there,

Got a dilemma and hoping you sensible lot can help me out.

We have two houses for sale, one of them has sold (house 1) and almost through, the other (house 2) has just gone on the market last week, priced to sell fast, under-cutting all houses same on the estate.

We expect to pull out about £60k out of house 1 and were hoping to use this as deposit on a new house, priced £240,000 and get a mortgage fixed for 2 years for £180,000 which we are already qualified for......

But!

I the house builder wants’s us to complete by the end of June latest! Otherwise we will lose the 10k discount we got on the house (should have been £250k) as they told me this is the incentive to complete fast.

So, I know it's almost impossible to sell house 2 in that time frame so I'm stuck.

In an ideal world I could borrow £140k which is what I need to pay off the mortgage on house 2 and just sell it at leisure; I know it will sell at that price not a problem.

We really don't want to lose our new house, 10k discount is really good, and the same house is now 260k on another site 5 mins down the road.

Should we gamble on it? I was thinking about getting some kind of bridging loan or something?

Can anyone help me out or offer any advice?

Thanks,

Mark.

herbiesjp

Hi MArk

There are a few ways that this could be done, but it depends on your whole sceanrio as to whether they would work

1) re-mortgage proeprty two in order to get as much equity as possible to buy the new one outright with other funds you may have?

2) Do a let to buy mortgage - let out property two temporarily, and a lot of lenders will ignore the property in the background. However your incomes would need to be sufficient to get the mortgage needed on the new property

3) non simultaneous sale/purchase


There is a lot of information missing that would be needed to see if the scenario would work

I think you would be best to discuss with a whole of market adviser, as you need to make sure you get the set up right, in order to be able to get the mortgage on the new property

silvercar

Only your choice if its worth a gamble. If this house goes are there another 20 similar houses you could buy in a few months time? If so, you may be safer waiting.

If you have to have this house and now, make sure you have money set aside in case the houses take a year to sell. Easiest way would be by getting a mortgage on the new property with no redemption penalites. That way you can redeem it as soon as the other houses sell. Bridging loans are expensive, particularly if they go on longer than intended. Buying one house on the basis of the future sale of another is not for the faint-hearted.

Have you thought about letting one of the properties instead of selling?