What fees are involved in a concessionary purchase?

ideal_knowledge001

Hello Guys,

I needed some tips, in the process of going through a concessionary purchase (buying my dad's property).

Say if the property is worth £200k but he is gifting me 50k equity and I am only taking out a mortgage of £150k then would I pay stamp duty on the house value price, or the £150k amount as that's how much I am paying to purchase the house from my dad.

What costs are involved and roughly how much?

I know legal fees tend to be quite high but do not know what it covers, i have rough ideas there's search fees and land registry fees etc.

I have estimated in total the mortgage cost to be around £4k including stamp duty legal etc, is this too less?

Thanks

kingstreet

Stamp duty is paid on the actual cost, not the true value.

Solicitors costs, fees and disbursements vary on location and you'll need a firm to represent him, as well as one to represent you.

ideal_knowledge001

kingstreet wrote: »

Stamp duty is paid on the actual cost, not the true value.

Solicitors costs, fees and disbursements vary on location and you'll need a firm to represent him, as well as one to represent you.

Am I right to say the actual cost in this case is £150k so stamp duty will be 1% = £1500?

Ok I will speak to my solicitor I am awaiting a quote from him but thought let me see what others say. My house is based in East London, East Ham.

Do you feel £4,000 will cover all the costs involved in purchasing a property?

Thanks

dotdash79

No because that would be 100% mortgage then which wouldn't be allowed, the actual cost is £200K with £150K lending and £50k gifted deposit.

ideal_knowledge001

dotdash79 wrote: »

No because that would be 100% mortgage then which wouldn't be allowed, the actual cost is £200K with £150K lending and £50k gifted deposit.

But then this contradicts what King street is saying?

I have been told by a solicitor when it is a concessionary purchase stamp duty is paid on the mortgage amount, not the house value amount...but I wasn't sure if he knew what he was saying so wanted to see the views here.

dotdash79

But the sold price wouldn't be £150k as you have told the mortgage company that the price is £200k to get the deal you need.

Otherwise it's an 100% mortgage and you have committed mortgage fraud, don't forget if you have a mortgage then your solicitor are acting on there behalf as well as yours.

Dave_Ham

I think Kings. has probably worded it poorly, as Stamp Duty is paid on the £200k (or sale price) and not the mortgage value raised.

All the best

ideal_knowledge001

That's fine so I will pay 1% on £200k, thanks for all your help guys.

dotdash79

It's £500 difference

kingstreet

No. It's the actual consideration paid, not the value.

Ask solicitor.

See post #15 from Richard;-

https://forums.moneysavingexpert.com/discussion/comment/57236983#Comment_57236983

I used to make the same mistake!

ideal_knowledge001

kingstreet wrote: »

No. It's the actual consideration paid, not the value.

Ask solicitor.

See post #15 from Richard;-

https://forums.moneysavingexpert.com/discussion/comment/57236983#Comment_57236983

I used to make the same mistake!

Ok now I am really confused lol, my solicitor said it's on the £150k too. Come on we need a few more people to say something on here! :mad: