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Best way to raise money for new home?
blackbook_2
Posts: 17 Forumite
Hi all, ill try and keep this short. Me and my better half have found a house we would like to buy (after 3 years of looking) It ticks all the boxes for us, but the vendors are pushing for a fast sale or they will put it back on the market. (we have an offer excepted and it is currently off the market stc)
Our postion is that I earn just over 30,000 a year, our house has a 55,000 mortgage and is on the market at 340,000. My wife has just sold a rental property she had to come up with the shortfall we will have to buy the new home.
That will give us about 200,000 in the bank, (providing it all goes thro, but its a cash buyer and is looking solid)
So we should have 200,000 in the bank and 30,000 earnings, the new house is 360,000 plus fees and stamp duty.
If we could raise the funds to proceed with the purchase of the new house now instead of waiting for ours to sell we would but as far as I can tell my mortgage ability is about 140,000 of which 55,000 is already being used on our house which means we can only raise 85,000 and we need 160,000 plus.
Does any one have any cost effective ideas on how we could raise more funds, fast, assuming we have 200tho in the bank and equity of about 260-275 in our house and an income of 30 tho a year.
Hope that makes sense?
Many thanks in advance.:o
Our postion is that I earn just over 30,000 a year, our house has a 55,000 mortgage and is on the market at 340,000. My wife has just sold a rental property she had to come up with the shortfall we will have to buy the new home.
That will give us about 200,000 in the bank, (providing it all goes thro, but its a cash buyer and is looking solid)
So we should have 200,000 in the bank and 30,000 earnings, the new house is 360,000 plus fees and stamp duty.
If we could raise the funds to proceed with the purchase of the new house now instead of waiting for ours to sell we would but as far as I can tell my mortgage ability is about 140,000 of which 55,000 is already being used on our house which means we can only raise 85,000 and we need 160,000 plus.
Does any one have any cost effective ideas on how we could raise more funds, fast, assuming we have 200tho in the bank and equity of about 260-275 in our house and an income of 30 tho a year.
Hope that makes sense?
Many thanks in advance.:o
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Comments
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Would you not have to pay the extra stamp duty as it will technically be your second home?0
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A bridging loan might the be the answer. Have you had a broker look over the figures for you?I am a Mortgage Adviser
You should note that this site doesn't check my status as a mortgage adviser, so you need to take my word for it. This signature is here as I follow MSE's Mortgage Adviser Code of Conduct. Any posts on here are for information and discussion purposes only and shouldn't be seen as financial advice.0 -
Thanks for the reply, we would consider a bridging loan but have heard these can be very expensive, and not sure where to look it up?0
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Selling a rental property: So there will be CGT to pay, hopefully: (**).
** Hopefully as in hopefully wife made enough profit to be eligible to pay tax on capital gain.. The alternative being less money to play with...0 -
Regarding the stamp duty 3% increase, I think this is correct, but yep quite right looks like we have to find that too:eek:
Q. What if I need to buy another main residence before I can sell my last one?
A. If you move out of your main residence (Home A) but keep it and buy another main residence (Home B), you will have to pay the 3% Stamp Duty surcharge initially. However, so long as you sell Home A within 36 months (increased from 18 months in the March 2016 Budget)of completing on the purchase of Home B, HMRC will make a full refund.
So looks like we will have to pay it but should get it back.
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Yep there is cgt to pay but have already accounted for that in the calculation.
To Thruelmir, I know what you are saying, and making the vendor wait until our house sells would be ideal, but at the same time they do seem very keen to get things done and we dont want to lose the property.
May just have to wait and hope for a while as other options seem expensive!0 -
As a point of interest, if Ive got this right, :question: It looks like the 3% hike in stamp duty can be offsett against any cgt on the property you are selling.
Just thought it was worth a mention.
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Is a bridging loan going to be cheaper than reducing the price on your current house to the point at which it sells quickly?0
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