Loan to help with deposit? Should We ?

vk1982

Hi Everyone, looking for some advice....again!

We are desperate to move house. Have been for a few years, we've completely outgrown our home (2 kids have come along). The problem we face is that we have lost around £30k on what we paid 5 years ago.

So once we do sell we will be lucky to make around £4k profit on our mortgage balance. We ploughed all of our savings into the first mortgage therefore our only deposit on a new house will be any profit we make.

[Deleted User]

No point. A loan won't be allowed as a deposit.

vk1982

Hi Everyone, looking for some advice....again!

We are desperate to move house. Have been for a few years, we've completely outgrown our home (2 kids have come along). The problem we face is that we have lost around £30k on what we paid 5 years ago.

So once we do sell we will be lucky to make around £4k profit on our mortgage balance. We ploughed all of our savings into the first mortgage therefore our only deposit on a new house will be any profit we make plus a few grand savings.

We have a car that a family member bought outright for us last year. It was £10,000 (very generous I know)

My question is... should we take out a loan for the £10k to help us pay a deposit on a new place? Is it legal to do this? I'm thinking we can just say the loan is for the car? If mortgage lenders look into the loan and ask what its for we can say the car? I don't think this is unjust?

Does anyone know anything on the legalities of this? Or does anyone have any experience advice / anything is appreciated, thanks.

PS - the loan will cost us £200 a month which we can afford ontop of a higher mortgage payment.

[Deleted User]

vk1982 wrote: »

My question is... should we take out a loan for the £10k to help us pay a deposit on a new place? Is it legal to do this? I'm thinking we can just say the loan is for the car? If mortgage lenders look into the loan and ask what its for we can say the car? I don't think this is unjust?

Not so much unjust, as fraudulent.

matttye

Forget you ever even considered it.

vk1982

Thanks for your [STRIKE]UN[/STRIKE]- helpful reply

matttye

vk1982 wrote: »

Thanks for your [STRIKE]UN[/STRIKE]- helpful reply

Sorry it's not the answer you wanted, but zx81 is correct. Lying to the mortgage lender is fraudulent and you can be prosecuted for it if caught.

vk1982

Ok..... Thanks.... You do realise that these posts are real people lives. I am a genuine hard working person who is asking for USEFUL advice on how I can get myself and my family out of our one bedroom property. I hope you and your family never end up in a situation like us and thousands of others in the UK. Stuck!

vk1982

matttye wrote: »

Sorry it's not the answer you wanted, but zx81 is correct. Lying to the mortgage lender is fraudulent and you can be prosecuted for it if caught.

Thanks for this advice. This is what I was after. I didn't realise that this was classed a fradulent. I was just looking for a bit more information. Thanks

matttye

vk1982 wrote: »

Ok..... Thanks.... You do realise that these posts are real people lives. I am a genuine hard working person who is asking for USEFUL advice on how I can get myself and my family out of our one bedroom property. I hope you and your family never end up in a situation like us and thousands of others in the UK. Stuck!

I appreciate your predicament but that doesn't mean I'm just going to blindly agree with you committing a criminal offence. You could end up even more stuck... in jail!

Even if you did try it, they would want to see paperwork.. bank statements. They would see the £10,000 being paid into your account by the loan company and no corresponding transaction going out for the car. It wouldn't work.

But yeah, lying to them isn't a sensible option.

Could you not sell the car, buy a cheap runaround and use the rest of the money to help with the deposit? Could you make use of any of the government schemes?

matttye

vk1982 wrote: »

Thanks for this advice. This is what I was after. I didn't realise that this was classed a fradulent. I was just looking for a bit more information. Thanks

Yeah it would be fraud by false representation.

2Fraud by false representation

(1)A person is in breach of this section if he—
(a)dishonestly makes a false representation, and
(b)intends, by making the representation—
(i)to make a gain for himself or another, or
(ii)to cause loss to another or to expose another to a risk of loss.
(2)A representation is false if—
(a)it is untrue or misleading, and
(b)the person making it knows that it is, or might be, untrue or misleading.

http://www.legislation.gov.uk/ukpga/2006/35/section/2