How to fund a house purchase?

thestens

My son and his wife have seen a house that is perfect for them. They are just about to put their house up for sale but are worried they will lose the one they want to someone else. They think their house will sell quickly as they are very popular in the area where they live. The house hey want is a lot more expensive. They don't know the best way to try to fund both for a short while. A bridging loan? Two mortgages? Is it possible?

HouseBuyer77

Bridging loans are expensive and hard to obtain.

Two mortgages may be possible but only if your son and his wife can afford two mortgages at once (meaning their current place and the place they intend to buy are way inside their maximum borrowing/affordability).

This is basically the dilemma any owner occupier wishing to buy a new house faces. Like everyone else they just need to get an offer accepted on their place ASAP so they are proceedable for the place they want to offer on. Some-one else may be ahead of them in this, and they'll loose the house they want. Such is life.

thestens

As I thought, although I didn't know bridging loans were hard to get. They probably can't afford both both mortgages. They said something about a buy to let mortgage on their present house for a short time. Don't know if that's feasible?

eddddy

By far the best plan is to put their own property on the market at a competitive price, so that it goes under offer quickly.


Tactically, it may help them if they use the same EA that is selling the house they want to buy.

thestens

Yes that sounds sensible, the money they lose on a cheap sale probably would only be the same as the fees they'd pay on expensive loans. I don't think they can use the same agent as the area is different.

Cakeguts

I think the first thing to do is to decide if they want to move. This is important because if they can't sell their house in time to buy the other one do they still want to move? Having worked that out then selling the house they are in is going to be the cheapest way to do this.

marksoton

thestens wrote: »

Yes that sounds sensible, the money they lose on a cheap sale probably would only be the same as the fees they'd pay on expensive loans. I don't think they can use the same agent as the area is different.

As lovely as the new place sounds. It doesn't sound like they can afford it.....

Davesnave

Many people think their house will sell quickly.

Sometimes, they're right, but when money is tight, the willingness to market at an attractive price is frequently lacking. That's understandable.

I've seen this a couple of times recently in my village; a desirable house has gone up for sale and a local couple have responded by marketing theirs with the intention of buying it.

On both occasions, it didn't work out. The house went under offer in six weeks or so, and the local hopefuls withdrew from the market, unsold. It's fair to say that neither had prepared their house well for selling.

It's not a great time of year to be selling, so being bold is important. Simply matching the price of competitors might not be enough.

always_sunny

Whatever solution (avoid loan sharks) would be based on affordability unless someone gifts them some money? Why buy something they obviously would struggle to afford or haven't planned for it?
Houses come and go but bankruptcy lasts a long time!

getmore4less

Bank of mums and dads any good for a short term sub?

If they were looking why was their place not on the market or at least prepared?

glentoran99

marksoton wrote: »

As lovely as the new place sounds. It doesn't sound like they can afford it.....

What are you basing that on?