Buying from a relative

supermassive

Ok, so we can afford to get a £150,000 mortgage... only problem is that we can't actually afford to save for a deposit because rental prices are so blinking high, and the houses that we can save the 5% for are... let's just say, I wouldn't inflict them upon anyone with a heartbeat.

So my mother in law is selling her house. She wants a quickie sale as she is moving closer to (some of the) family and at the moment lives out of the mix a bit. She's not very mobile so she really needs to move closer.

Her house is on the market for £x. It's never had anything done to it beyond carpets and wallpaper... and kitchen and bathroom updating...

It's really ideal for us... it's a good location, the neighbours are top notch, the house is an ok size (and can be easily altered on a budget) it has an amazing sized garden...

She's offered to 'gift' us some money towards a deposit on a house, which leads me to my question..

Can she gift me the deposit for her own house, so that we can buy that for an offer of £x + the amount she's gifted for deposit and she gets her deposit plus the house price back to her?

Are there any restrictions on doing this? It'll kill 2 birds with one stone... and save the house leaving the family (it's been in her family for over 100 years and is in an excellent state of repair).

Advice please!

kingstreet

You can buy the property at a discounted price, what's known as a concessionary purchase, when a relative is the vendor, or you as a sitting tenant.

You would find this easier to do, by consulting an independent broker.

amnblog

You will need a clean credit history otherwise you might need to put 5% of your own case in!


As KS says - a case for a mortgage broker.

supermassive

I'm not sure what any of that means haha

Basically, she would give us 8k, which we would use to get a mortgage, buy her house, at 8k more than she's offering it for atm (cheapo quicksale that isn't so quick) thus giving her the cost of the house, plus her deposit back..

Basically a 0% deposit mortgage, really. I suppose the risk is that the mortgage will be refused because the house isn't worth as much as I want to offer

Both of our credit histories are fine (after yelling at alot of companies for misusing the credit reference services numerous times)

p00hsticks

supermassive wrote: »

Basically, she would give us 8k, which we would use to get a mortgage, buy her house, at 8k more than she's offering it for atm (cheapo quicksale that isn't so quick) thus giving her the cost of the house, plus her deposit back..

If it's not currently selling at £x, I'm not sure how likely the mortgagers valuer will be to agree that it's worth £x + £8K

amnblog

It does not work like that SM.


She would sell to you for less than the property is worth, and in all likelihood that will need to be at least 10% less than the property is worth (£135,000 on £150,000).