First Time Buyer (HELP Please)

rs2016

First of all sorry for starting a new thread for first time buyer help but I've searched online and the forums without full joy for my questions and I'm just wondering if anyone would be able to help me out.


Me and my partner have found an house we would like to buy, currently on the market for £110k. We have a meeting with a mortgage advisor next week. Are we likely to be accepted? Joint earnings about £40k a year with no debt and good credit scores but looking to just use a 5% deposit.


We have majority of the deposit and just awaiting October pay day to afford solicitor and surveying fees etc, My main question is do the bank have to see all the deposit when you apply or can that be paid in at a later date and at what point does it actually leave your bank?


last question....do most banks offer 5% deposits or is there just certain ones?


Thank you for any advice!

kingstreet

Possibly.

Possibly not.

Not every lender offers 95% mortgages, no.

All these questions and more can be answered according to your individual circumstances when you meet with your appointed broker.

All we can do is speculate...

SavingSteve

At face value OP you have enough joint earnings for the level of borrowing you're proposing.

It will leave your account around when you exchange on the purchase, your solicitors will ask for you to transfer into their client account in advance of exchange. Also most contracts by default expect 10% on exchange, so you will need to let your sellers know you can only pay 5% on exchange.

Mortgage_Moog

I've just bought and was in a similar position. The mortgages you get with a 5% deposit are usually only for shared equity, new builds etc. You can't just buy any house on a 5% deposit at most places and even when you try to do that they push you for 10%. The reason for a 10% deposit being the norm is that if you pull out of the deal after exchanging contracts you have to pay the other person 10% of the value of the property. That's why 5% deposit mortgages are so risky.

The bank won't ask to see your deposit at all when you apply or even when you go for your 3+ hour interview. That really surprised me but they didn't want to see at all. The people that will want to see are the estate agents. When you put in an offer they will only accept it if you can show them an amount close to your deposit amount on a bank statement. It doesn't have to be spot on as the process takes so long that it'll be at least 2 months after making an offer until you can move in but if you're a long way off they won't like it.

You only pay the deposit right at the very end about a week before moving in. I paid mine mixed in with solicitors fees and all the rest.

amnblog

Mortgage_Moog wrote: »

You can't just buy any house on a 5% deposit at most places and even when you try to do that they push you for 10%. The reason for a 10% deposit being the norm is that if you pull out of the deal after exchanging contracts you have to pay the other person 10% of the value of the property. That's why 5% deposit mortgages are so risky.

It is crediting scoring that stops a 5% deposit being an option in most cases.

Mortgage_Moog wrote: »

The bank won't ask to see your deposit at all when you apply or even when you go for your 3+ hour interview.

Expect the Lender to ask for evidence of your deposit

Mortgage_Moog wrote: »

The people that will want to see are the estate agents. When

Don't be showing the EA your Bank Statements - none of their business. (One of my pet hates)

Mortgage_Moog wrote: »

You only pay the deposit right at the very end about a week before moving in. I paid mine mixed in with solicitors fees and all the rest.

This is generally the case.

Finally

Engage a mortgage broker who can, establish your options, give you the best chance of lending with a 5% deposit, and deal with the Estate Agent.

Mortgage_Moog

They never asked for proof of my deposit at all. I even offered to show the bank at my interview and they said "no, no, we don't need to see that". At no point did the bank ever ask to see proof of my deposit.

I did go to a broker to start with and they said just what you just have. None of it turned out to be true at all. I'm not saying you're wrong but the experience I had didn't match with what my broker said at all, especially when he said I'd never get a mortgage and yet here I am living in my new home!

amnblog

There are always exceptions. I stand by what I said.