Deposit boosting advice

woolgar.c

Hello,

I am hoping someone will be able to help & provide a bit of advice.
We are first time buyers (husband is in the army) & just looking into deposit options & mortgage availability. I've included some figures below to help explain our situation.

We basically want to know if there are any schemes available to help boost our deposit so we can buy a house sooner rather than late. However....we want to rent the property out immediately. We are aware that numerous mortgage companies allow service personnel to purchase a home on a residential mortgage but let it out straight out due to being posted elsewhere.
Every scheme to boost deposits we have looked into though, seem to have a clause that you must live in the property you purchase (help to buy, shared ownership)...even the forces scheme such as LSAP (long service advance of pay) & FHTB (forces help to buy).
We did look in to the AFHOS (armed forces home ownership scheme) however we were very nervous of the idea of shared equity & the possibility of not being allowed to sell our home in the future if an offer wasn't approved by the lender.

Current deposit: 10k
House prices - for 3 bed: approx 195-230k
Joint income: 47k
Current commitments: car finance, approx £390/month. Loan approx £180/month.

Thank you v much!

Foxy-Stoat_3

So your looking for a buy to let mortgage, you will need 25% deposit plus fees and legals. Only way to boost your deposit would be to save.

Look at ways to down scale your lifestyle, can you out your £4600 a year car lease deal and buy a cheaper car outright and drive that for a few years? Look at other ways to save money.

woolgar.c

my original info may not have been clear.....we don't need a buy to let mortgage as many mortgage companies allow people serving in the armed forces to purchase a house on a residential mortgage but let it straight away, due to their commitment of living wherever the army sends them.

One option as you say is to continue saving for longer. We would just like to get an idea of whether any of the current schemes can assist us to up our deposit now & rent out the property.

Thanks

sniperpenguin

Out of interest, why would you want to rent it out immediately... Sure you would move straight into your purchased property?

Surely if you are planning that, you are effectively looking for a scheme to enable you both as BTL landlords and therefore generate income?

woolgar.c

We would want to rent it out straight away as we are buying near family on the south coast but currently posted in Germany. Our next posting is north scotland...with the number of exercises, deployments & training that husband has to attend with the army we'd prefer not to live apart even longer.
We're not fussed about making money from the rent, we'd prefer it to cover the mortgage of course.
The important thing to us is getting on the property ladder sooner rather than later so we are ready with somewhere to go when my husband does leave the army.

Senior_Paper_Monitor

I am not aware that MODLSAP requires an undertaking to move in immediately - they certainly require solicitors undertakings etc that it is being used for residential property purchase but that doesn't preclude the lender schemes that are based on residential mortgages but have the armed forces waiver on renting out (we do quite a lot of these as we are we only 1/2 a mile from a major RAF base).


I stand corrected - having just checked the regulations it does (and subsequent rental also requires the CO's permission.

Thrugelmir

woolgar.c wrote: »

We're not fussed about making money from the rent, we'd prefer it to cover the mortgage of course.

With only a 10% deposit this could be questionable once all costs along with potential void periods are factored in.

Better to keep saving.

Why the rush?

Trying_to_be_good

My OH is RN and we've bought our own place, but are able to live it in as we didn't buy near family but near a significant RN centre of employment...

The MOD tend to only help out with LSAP/HTB if you're then not also using the heavily subsidised SFA, otherwise they're sort of giving you a double helping of support. I don't know of any additional help, but whilst you're in Germany and have access to other subsidised buying, keeping your costs down to up your savings as quickly as possible is likely to help, albeit not as quickly as you'd hoped.

The DFW board are brilliant at helping to reduce living costs, so try a post over there.

Good luck!

woolgar.c

Thrugelmir wrote: »

With only a 10% deposit this could be questionable once all costs along with potential void periods are factored in.

Better to keep saving.

Why the rush?

What are 'void periods'? Do you mean periods the house has no tenants?

We feel like we are in a rush as the housing prices keep increasing & even saving more it's likely that we'll have a bigger deposit saved but it'll end up being a smaller fraction of the property cost.

woolgar.c

Trying_to_be_good wrote: »

The MOD tend to only help out with LSAP/HTB if you're then not also using the heavily subsidised SFA, otherwise they're sort of giving you a double helping of support.

The DFW board are brilliant at helping to reduce living costs, so try a post over there.

Good luck!

I hadn't thought of the entitlement to subsidised SFA & the HTB as a double helping of support. I agree it would seem like this, however the subsidised SFA is supposed to be due to the fact that they dictate where you work & live during a posting. We had wrongly assumed that the new FHTB would enable service persons to purchase a house for the future & be able to live together in SFA in the meantime. The idea of the FHTB was to ensure service persons are not hampered by getting on the property ladder late, i.e. when they leave the forces. Although it seems to do so you would have to live married unaccompanied.

Which is the DFW board?

Thanks

Thrugelmir

woolgar.c wrote: »

What are 'void periods'? Do you mean periods the house has no tenants?

Yes there will be periods with no tenant, or possibly that the tenant will default on paying the rent.

Letting property isn't a question of just collecting rent. It's a not a hobby it's a business. So you need to be prepared. As people more often or not aren't what you might think them to be.