Friend putting up money for our new house

chesterpants

Hello.
We're currently in talks with my partners boss/friend who is potentially going to put up the money to secure our new house (£145000) as we need time to sell our current property.
We unfortunately are unable to get a mortgage at the moment due to a couple of debts affecting our credit rating (proceeds from house sale will cover these). We are desperate to secure this house as it is our dream house, a once in a lifetime type property for us.
He's an extremely weathly man so may very well be happy for us to pay him back monthly like we would a mortgage, but I'm currently exploring ways to pay him back if he wants it back as a lump sum, so my question is this:-
Would we be able to take out a mortgage on the new property, once it's already purhcased, to pay him back?
With the proceeds from the sale of our house, we could pay off our debts to give us a better credit rating and then have approx. £20000 spare.
I hope this make sense, not easy to explain in just a few sentences!

Dave_Ham

You need some formal advice, but depending upon value of the property you may well incur stamp duty twice on this plan.

Another hurdle is many lenders require ownership for 6 or 12 months before they will allow an application/completion.

hamster2013

why would you take a mortgage from a bank where you have got a 0% interest free loan from a wealthy friend?

anyways - would also depend on what security he requires - what guarantees he signs off from you.

Thrugelmir

How do you propose funding two loans concurrently? Your existing mortgage and the money lent by your "friend".

A couple of debts in themselves should not be an insurmountable obstacle to obtaining a mortgage. So before getting carried away with your must have dream house. Perhaps a reality check, using a mortgage broker may be your best option.

somethingcorporate

Read the lending money to friends and family thread and the copious lending / borrowing from "friends" & colleagues threads.

They tend to be disasters waiting to happen.

What happens if you lose your jobs/unable to pay back this friend. I'd suggest you just do it the old fashioned way, there will always be another house.

FTBSOS

Could he ask you're 'rich' friend to lend me some too?

I have also found a dream house but only have 5% deposit and the greedy bank wants another 10%, which I don't have.