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Buying from parents
cogsy1976
Posts: 27 Forumite
Hi all
Hoping for some advice on this, here goes!
Parents currently own a home of which we rent from them but they have said we can buy for £117k (house value is £147k) the £117k figure is so we dont have to pay stamp duty.
Effectively we have no deposit as we would need a mortgage of £117k, so question is can we buy this way or do we need to buy at £147k with the £30k difference being the deposit?
Thanks
Hoping for some advice on this, here goes!
Parents currently own a home of which we rent from them but they have said we can buy for £117k (house value is £147k) the £117k figure is so we dont have to pay stamp duty.
Effectively we have no deposit as we would need a mortgage of £117k, so question is can we buy this way or do we need to buy at £147k with the £30k difference being the deposit?
Thanks
0
Comments
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If you borrow £117 I suspect the lender's solicitor will be unwilling to submit a SDLT return showing 117 as the purchase price. Lenders don't lend 100%. Solicitor would suspect SDLT avoidance.
Thogh I have a feeling there may be a SDLT exclusion where property passes within family.......???
edit: I seem to be wrong:
https://www.gov.uk/sdlt-transferring-ownership-of-land-or-property0 -
You won't get a 100% mortgage. Your parents could gift you a £30k deposit though and you get a mortgage of £117k.
Your parents would be charged CGT on the market value of the property regardless of what lower price they might sell it to you so from that point of view it doesn't really matter how much of a deposit they gift you.0
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