FTB offer advice- Seller Pays SD

Jeffrey_Shaw

mrginge wrote: »

There's no MAY about it.
To not declare it would be mortgage fraud, since it is effectively a backhander used to inflate a mortgage.

Yes. Better not to touch it with a bargepole, unless you like prison food.

ethank

My understanding is that Nationwide only accept stamp duty paid as a housebuilder incentive, and not from a vendor. If the buyer gives this to you, they will deduct it from the mortgage amount.

Annie1960

I discussed a similar thing recently as I have just put my house on the market, and it's over the threshold. My solicitor said this is not possible, HMRC will pursue the buyer for the tax, it's no longer possible to do this (it used to be possible in the past, but HMRC has clamped down).

If you are thinking of this, I suggest you talk to your solicitor about it. EAs don't necessarily understand what they are doing.

thelem

If you were willing to accept it, just offer £128750 instead and avoid any complications.

harrys_dad

Technically you need to offer £128,712.87, which will then have stamp duty of £1287.13, giving a total of £130,000 .

In truth I would offer what you think it is worth, which may be £124,999.

Redguy17

Thanks Guys

The issue is i'm not sure what a fair price is in thie market house was bought for 117k in 2005. is it fair to expect a 1% increase in house value over a ten year period ? i would be disappointed with less than that if i bought and tried to sell in 10 years time.

NW are not happy about any incentives though so i'm not longer persuing that option ( if was every really one in the first place)!

kinger101

harrys_dad wrote: »

Technically you need to offer £128,712.87, which will then have stamp duty of £1287.13, giving a total of £130,000 .

In truth I would offer what you think it is worth, which may be £124,999.

Well in theory, it's £128,700 the vendor is prepared to accept, as the stamp duty would have been £1,300 on £130,000. If the vendor accepts this instead, then that's £13 less overall in stamp duty.

However, I think the issue here is that with this arrangement, the purchaser needs to find £1,287, as this can't be added to the mortgage. If the property has been on the market for a long time, I'd hold at £125K.

thelem

Redguy17 wrote: »

The issue is i'm not sure what a fair price is in thie market house was bought for 117k in 2005. is it fair to expect a 1% increase in house value over a ten year period ? i would be disappointed with less than that if i bought and tried to sell in 10 years time.

Valuing a house is really tricky, and no one on here is going to be able to give you an exact price for what it's worth. The best advice you're likely to get is to look at prices of recently sold properties, but they are likely to be a few months out of date and you often won't have much information on the property that was sold. Asking prices are misleading, as property is often (though not always) sold below asking price, and how much below will vary from region to region and vendor to vendor.

I'm a bit concerned that you seem to be expecting property values to rise by a set percentage each year. You should be prepared for the possibility that it could lose value. Also remember that the trends reported on the national news do not apply to the whole country, as each area will be affected by different issues.

The price paid 10 years ago isn't a good guide, as you don't know if they over/under paid at the time, what condition it was in (other than major work), how has the local area changed etc.

BeauLiLuLu

Can you not go with a lender (like the Halifax or TSB) who, for FTB's, currently have a promotion to pay your stamp duty????

Redguy17

Thanks again everyone for the replies. Lilu i had not know about the halifax and tsb deals thanks for pointing that out.

Kinger/Thelem thanks for the advice about house prices. I do realise that prices can go down but i also know that in the long term prices generally tend to go up. I know this is a gross generalisation but the 1% per annum thing is just my attempt to try to make sense of the house price situation.

Did some more research and found out i have 30 days after completion to pay stamp duty which won't be an issue thought i need it up front.

Thanks for all your advice guys, agreed to pay the 130 k as we really like the house. Fingers crossed now that the bank thinks it's worth it!:cool: