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Is this legal?
Comments
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It's mortgage fraud.
You are artificially trying to maintain that the price you are paying is higher than the real amount. Your solicitor HAS to inform the lender of the reduced price (if he wants to be in a job next week). If the lender gets wind of your scheme it is likely the offer will be withdrawn and you will end up on the CIFAS register.
I have never known a solicitor go along with such a deal.0 -
It's mortgage fraud.
You are artificially trying to maintain that the price you are paying is higher than the real amount. Your solicitor HAS to inform the lender of the reduced price (if he wants to be in a job next week). If the lender gets wind of your scheme it is likely the offer will be withdrawn and you will end up on the CIFAS register.
I have never known a solicitor go along with such a deal.
But it has nothing to do with the mortgage. The house is worth what we are paying. If she paid to have the work done would that be fraud? If not, then what's the difference in her paying us the money to pay for it?
Any solutions rather than saying it's not a good idea?0 -
Because you will have lied to your mortgage company and solicitor.
There is no up side for you on this deal. You take all the risk and end up over paying for the house.
Dare i suggest you tell the EA you will only pay the amount of the valuation?
The house is worth what we are paying, the valuation says it.... I wasn't planning on lying to anyone!0 -
No. A lender offers the mortgage amount based on the valuation or purchase price WHICHEVER is LOWER. Therefore the valuation has now been trumped by the purchase price.
You can argue about it all you like. I'm telling you what the actual reality is.
If the solicitor/you do not inform the lender of the change in purchase price the solicitor/you are committing fraud.0 -
ConfusedofYorkshire wrote: »I wasn't planning on lying to anyone!
Except your mortgage company to maintain LTV.0 -
ConfusedofYorkshire wrote: »The house is worth what we are paying, the valuation says it.... I wasn't planning on lying to anyone!
Yes you are, because the net amount you are paying for the house is less than the mortgage company think it is. so you are effectively defrauding the mortgage company into lending you more than the house is worth.
You can dress it up any way you want but its an undeclared backhander simple as.0 -
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ConfusedofYorkshire wrote: »No- my LTV would stay the same whether they reduced the price or not.
The only reason the LTV would change would be if i kept part of my deposit in order to pay for the repairs and borrowed more money.
Didn't you read LEON's post?
The 'V' is reduced because you are getting a backhander off the vendor. The value of the house is not £x anymore it is £x - y.
Its fine that you ask a reasonable question, but don't then try argue the toss because everybody who responds tells you something you don't want to hear.0 -
yes i did. my response way to Andy who said:
Originally Posted by AndyT678
Except your mortgage company to maintain LTV.
This statement is simply incorrect. it says I am lying to the mortgage company in order to maintain my LTV- which is factually incorrect. Even if I was planning on lying to the lender (I"m not) i wouldn't be doing it in order to maintain an LTV. The LTV would remain exactly the same, as if we took the reduction we would reduce the amount of deposit.
I am not saying that Leon was wrong- I am saying that that particular statement was wrong.
As for arguing the toss- I just want to understand the legal side of it all- some says its illegal, others not. I wanted explanations. Or alternatives.
Can I ask her to pay for the repairs instead for example?0 -
ConfusedofYorkshire wrote: »As for arguing the toss- I just want to understand the legal side of it all- some says its illegal, others not. I wanted explanations. Or alternatives.
Can I ask her to pay for the repairs instead for example?
You've got the legal side. Undeclared it would be mortgage fraud.
Alternatives - well reduce your offer or find the money yourself. Personally if the valuation has come in at your offer, then i don't see why you are expecting ANY kind of reduction. If i was the vendor you'd be politely told where to go....
You could ask her to pay for repairs, seems like a more sensible option than the brown envelope job. However, you are of course relying on her to not do it on the cheap....0
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