New to mortgages...

kattyao

I currently own a property which is worth approximately £70,000 - 80,000 (with no mortgage). I have cash savings of around £17,000.

I am looking to buy a property in the region of £120,000 - £140,000. Looking for a bit of advice / discussion on how people would recommend doing this.

Should I put down a £15,000 deposit for a mortgage on the new property, then sell my current home, have money for renovations, and then savings for overpayments. (The downside to this being a larger mortgage with higher rates...)

OR

Should I sell my current property, which would mean moving into rented accommodation or parents' and then use this to put down a much larger £70,000 - £80,000 deposit? (The downside to this being I picture selling this place and then not finding anywhere to move to! Also costs of moving into an interim home...)

Any discussion would be much appreciated - what would you do if you were in this situation? It all seems very overwhelming at the moment! :wall:

amnblog

Not sure what you are saying here.


Is the problem that you want to do a lot of work on the new place before you move in, or that you cannot sell your current place and buy the new place at the same time?

kattyao

The issue is with the £70,000 - £80,000 being tied up in the house that I currently own.

I would need to sell this property to release the funds to put down a large deposit, so wouldn't be able to purchase a new property until this one has sold.

Sorry if I wasn't clear.

amnblog

The normal process is to sell your current place and buy the new place on the same day and they same time.


Your solicitor completes your sale and transfers your £70,000 to £80,000 to the seller towards the purchase of your new property.

kattyao

Even though I'm applying for a first time mortgage?

amnblog

Yes, even though you are applying for a mortgage when you do not have one on your current property.