I will be getting 8k in 5 years, but I need the cash now.

mrchrisman

In 3-5 years I will be given about £8,000. This is guaranteed. There is no way I can get hold of this money right now.

I need the money right now to pay towards a deposit on a new mortgage.

What's the best way to get hold of this money right now and pay the minimum interest/fees possible up to the time I actually get the money?

The obvious action is to get a loan with a good rate. The issue with this is that I'll be paying a monthly fee which might be hard to afford while also paying for my new mortgage.

Surely there must be something clever I can do? Ideally, I'd take out a loan that I only had to pay in one lump sum after the 5 years, but I'm guessing these kind of loans don't exist?

Does anyone have any clever ideas?
Thanks!

Hominu

So you basically want to borrow £8000 and pay it back in 3 - 5 years without incurring any fees or interest? These don't exist.

4% however is doable, and if you apply for the right credit card, it may help you out also, but I very much doubt it's going to be free, and not for the whole 8K.

mrchrisman

I'm happy to pay the interest, but I'd like to pay the money at the end of the term when I actually have the money I know I'm going to get.

Some kind of interest only loan would be ideal for this. This way I would only have to pay the interest every month, and then at the end of the term I could pay the whole amount when I get it.

YorkshireBoy

mrchrisman wrote: »

I need the money right now to pay towards a deposit on a new mortgage.

I believe you'll be asked to supply, and prove, the source of the funds.


And £8K debt will affect the amount the mortgage provider is prepared to lend.

ChesterDog

I don't wish to sound like a wet blanket, but few things in life - especially when it comes to receiving money - are certain.

Even when it really seems so.

PeacefulWaters

You could wait 5 years before buying.

DaveTheMus

£8'000 isn't a lot of money and 5 years is a long time to wait.....

Best to pretend the future £8'000 doesn't exist and you spend the next 5 years working very hard and saving as much as you can and I'll bet that if you do that you wont need the £8'000 for a deposit as you'll have earned more than enough......

then when you do get the £8'000 you can invest it in a S&S Isa or a SIPP

jamesd

A mortgage lender will normally want to know that the money tied up in your equity/deposit is your own. Borrowed money tends not to be acceptable because you can default on that borrowing as well a the loan, leaving them with a loss and you with no immediate money loss from either deposit or mortgage.

For this reason a plan to borrow money will normally fail to achieve your objective.

There is an alternative way to achieve the objective, the use of 0% for purchase deal credit cards. You can put your normal spending on the cards and put the unspent cash into savings accounts to use it to pay for the deposit. The credit card balance will reduce the amount that you can borrow but the deposit increase may let you get the mortgage you're after. It takes time to do this since it only happens as fast as your normal spending allows.

Another option sometimes can be to ask someone to give you the deposit as an outright gift. Borrowing from an individual is no more accepted than borrowing normally.

robatwork

Borrow it from your family who hopefully know that your promise you will be getting the £8k is genuine. You should however offer to pay back a little more to make up for inflation - say £8500 or £9000