First Time Seller , then Buying

MunchkinJess

Hi

Just wanted some advice really.

I bought my flat about 18 months ago as a first time buyer, new build, own it 100%.

I am now wanting to put it on the market and buy a house as we have a baby on the way.

I put a massive 30% deposit on my flat so have a good deposit for a house.With regards to mortgages is it based on when you sell your home as that will be your deposit ?

I am a complete newbie to all of this so just wanted to know general advice about how long it can take to sell your own property and buy another.

I dont really want to be left without a home to move in to.


a bit confused really any advice or help is greatly appreciated.

Thanks

holly_hobby

No, the deposit is generally reqd on exchange of contracts.

The way round this would be to exchange and complete (your sale and purchase) on the same day.

Your solicitor will confirm.

Hope this helps

Holly

StuC75

Yes the equity left from selling less all fees is what is then used as the deposit on the new property (also consider including buying fees involved - searches & stampduty etc as coming off this equity)..

Do allow for the fact buyers may offer less than asking price so this has a knock on affect with buying.. e.g. £10k off your asking price is straight off what you then have to pay your deposit (affects what you can then buy upto).

Most people stage it so that you Sell & Buy new house at the same time time - so youre not left out on the street.

Do look at what the likely value is on your existing house - new build is sometime at an extra premium, so do need a relistic valuation..

Do consider how income will be affected with maternity leave & thoughts of returning to work - base affordability on then rather than now..

hazyjo

I've only ever had the money to put down as a deposit once, but the equity in my property has counted as what I have to put down in relation to LTV of mortgage.

Usually the deposit is 'borrowed' from the person below you. If they're paying 10%, your solicitor might be able to negotiate 5% deposit on what you're buying (although I think if it fell through after exchange and you were at fault [unlikely], you'd have to find 10%).

Average sale/purchase takes 12 weeks. Can be longer with flats. My shortest was 5 weeks from offer to completion, my longest was 5 months.

Jx

StuC75

Not quite you tell the solicitor the deposit is coming from the sale, they will have the numbers to know what is left over - as will provide statements for sale & purchase showing what is left over.

What happens is the deposit works it way up the chain, the 'deposit' you are liable for is not the same as what is used for calculating the mortgage LTV - most are happy with the bottom of the chains deposit being used... Otherwise 99% of people would find it impossible to work up the property ladder!

Also avoid exchange and completion on the same day!.. it is a nightmare, as its All of Nothing..

had this last time (when also had 2month old baby), and the hassle of having the first suggested date fall though when everything had been packed and van booked was a pain!! also no one was liable for this not happening on that date, so just had to take it...

holly_hobby wrote: »

No, the deposit is generally reqd on exchange of contracts.

The way round this would be to exchange and complete (your sale and purchase) on the same day.

Your solicitor will confirm.

Hope this helps

Holly

MunchkinJess

Right so is the correct way to do things is to put my property on the market first ? or do I look for a house at the same time.

With regards to Maternity I am only taking a short maternity leave as statutory is very low and I am the high earner out of my partner and I. I am ideally looking to buy a house slightly further out that is roughly the same value as my flat.

Thanks for the advice.

StuC75

Get property valued - and compare to what actually selling for (sometime estate agents may over value).

Work out what price range you are looking for - although your buying similar price range - fees will eat into equity & possibly what banding your mortgage might fall into..

Look to see what is on the market in the desired area - is there a good availability of what you are looking for..

You can be selling and looking at the same time.. only downside is if you find the dream house & cant proceed - but equally you might sell quickly and struggle to find what you like..

So theres really no right or wrong answer here...

MunchkinJess wrote: »

Right so is the correct way to do things is to put my property on the market first ? or do I look for a house at the same time.

With regards to Maternity I am only taking a short maternity leave as statutory is very low and I am the high earner out of my partner and I. I am ideally looking to buy a house slightly further out that is roughly the same value as my flat.

Thanks for the advice.